McDonald’s is feeling the heat, and it’s not from the fryer. The burger behemoth just served up a cold quarter, with sales taking a dip as budget-conscious customers in the U.S., China, and beyond opted for cheaper eats or skipped out altogether.
Same-store sales at McDonald’s dropped 1 percent globally from April to June, marking the first decline since the dark days of late 2020 when the pandemic forced closures. In the U.S., the drop was nearly 1 percent as fewer folks lined up for their Big Macs and fries. Those who did, however, ended up shelling out more thanks to price hikes.
China, France, and the Middle East also saw a dip in foot traffic. McDonald’s has been facing a boycott in these regions over perceptions of its stance on the Gaza conflict, adding extra sauce to its troubles.
Back in April, McDonald’s warned that inflation-weary customers were tightening their belts. In a bid to win them back, the fast-food giant rolled out a $5 meal deal in the U.S. on June 25. But the effort came too late to save this quarter’s results.
Revenue remained flat at $6.5 billion, just shy of the $6.6 billion Wall Street had its eyes on. The company’s net income took a 12 percent hit, dropping to $2 billion, or $2.80 per share. Even after excluding one-time items, McDonald’s earnings of $2.97 per share fell short of the $3.07 analysts had predicted.
But this has not scared off investors, who are still lovin’ the shares. The stock of the golden arches rose by around 3.5 percent on Monday morning.