McDonald’s is taking a hit, but it’s not because of its fryers: The burger giant had a tough quarter with sales sagging as budget-conscious customers in the U.S., China and other countries opted for cheaper food or stopped going to McDonald’s.
McDonald’s same-store sales fell 1% globally from April to June, its first decline since the dark days of late 2020 when the pandemic forced restaurants to close. In the US, the drop was nearly 1% as fewer people lined up for Big Macs and fries, but higher prices meant those who did line up ended up paying more.
Foot traffic has also fallen in China, France and the Middle East, exacerbating the problem as McDonald’s faces boycotts in those regions over its stance on the Gaza conflict.
McDonald’s warned in April that inflation-weary customers were tightening their purse strings. The fast-food giant introduced $5 meal sets in the US on June 25 to try to win back customers. But the move came too late to salvage this quarter’s results.
Revenue was flat at $6.5 billion, slightly below the $6.6 billion Wall Street had expected. The company’s net income fell 12 percent to $2 billion, or $2.80 a share. Excluding one-time items, McDonald’s earnings per share were $2.97, below the $3.07 analysts had expected.
Undaunted, investors continue to love the stock: Shares of the Golden Arches were up about 3.5% on Monday morning.
