McDonald’s said on Monday that ongoing tensions in the Middle East are hurting its business.
Fourth quarter and full year 2023 report The Chicago-based burger chain said Monday that sales at its Licensed Markets business, which includes most of its stores in the Middle East, rose only 0.7% last quarter.
The company said the low numbers reflected the “effects of the war” between Israel and the Palestinian militant group Hamas in the Middle East.
This is lower than the company’s overall sales growth rate of 3.4% and growth of more than 4% each in its U.S. and other international businesses, the report said.
Monday’s report marks a significant change from a year ago, when the company’s License Markets business posted revenue growth of more than 16 percent, its best performance, CNN Business reported. report.
McDonald’s CEO Chris Kempczinski said in an earnings call Monday that the company is feeling the “most significant impact” in the Middle East and other Islamic countries such as Mayrasia and Indonesia. said.
“Also, as we said in our prepared remarks, our outlook is that as long as this conflict, this war, continues, we have no plans and we do not expect to see any significant improvement in this situation. We haven’t,” Kempczinski said. he told investors. “What’s happening right now is a human tragedy, and I think that weighs heavily on brands like ours.”
After acquiring Israel’s McDonald’s, the fast food company came under intense scrutiny Distant Thousands of free meals have been provided to Israeli troops and citizens following a surprise attack by Hamas on southern Israel. The move prompted calls to boycott the company in protest of Israeli airstrikes on Gaza that have killed more than 27,400 people since October last year. According to the enclave’s Ministry of Health.
Multiple franchise owners in the Middle East and Asia appeared in opposition According to multiple media reports last November, Israel opposed McDonald’s move.
Kempczinski said Monday that backlash against local businesses during the Israel-Hamas war is “disheartening and unfounded” and that McDonald’s will “always proudly open its doors to everyone.” .
McDonald’s is one of several companies facing boycotts over the Middle East, joining Starbucks and coca cola over accusations that he supported Israel’s war in Gaza.
Last week, Starbucks lowered its sales forecast due to weak spending in China and other markets, according to the Associated Press.
mcdonalds stock I stopped by On the Monday after the announcement, it was 3.7%.
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