McDonald’s Exceed Sales Anticipations Thanks To Affordable Menu New Product Launches
Date : 30th October, 2023
THE SOIL – McDonald’s (MCD.N) surpassed Wall Street forecasts for third-quarter sales and profit on Monday. The company was able to do so by introducing new products and continuing to attract customers who were having trouble paying for expensive food.
Following the industry-wide price increase last year, the burger giant has been able to maintain its meals relatively more inexpensive, which has helped fight the trend of inflation-hit consumers choosing to dine more at home and a reduction in foot traffic.
According to LSEG statistics, McDonald’s global comparable sales increased 8.8% in the quarter that ended on September 30, compared with analysts’ average prediction of a 7.36% increase.
McDonald's Introduced the Cheesy Jalapeno Bacon And Brought Back Spicy Chicken McNuggets to Menu
McDonald’s introduced the Cheesy Jalapeno Bacon quarter-pounder in July and brought back the beloved Spicy Chicken McNuggets to menus in September, drawing on its history of menu upgrades.
UBS analysts had remarked that both items probably contributed to strong sales growth in the third quarter.
The three months of the quarter witnessed a decline in overall eating traffic, but July had a 7.3% increase at McDonald’s, according to data from Placer.ai.
Over the next two months, McDonald’s foot traffic decreased by 1.1% and 3.7%, respectively, but it was still higher than the overall industry trends.
McDonald's Overseas Markets Grew by 8.3%
Despite a rise in other costs, overall restaurant margins rose 12% to $3.84 billion in dollar terms due to a decline in the cost of meats and vegetables.
The company increased its full-year margin projections from 45% to 46%. Comparable sales in the United States increased 8.1% during the quarter, exceeding forecasts of a 7.4% gain, partly due to greater average store spending.
In the meantime, same-store sales in McDonald’s overseas markets grew by 8.3%, slightly above forecast growth of 8.03%.
Revenue for the entire quarter rose 14% to $6.69 billion.$3.19 in adjusted profit per share surpassed $3.00 in forecasts.