Quarterly sale figures of McDonald’s Corp in the United States beat projections of the Wall Street, thanks to higher prices, larger order quantities, and additional menu items like the crispy chicken burger, the global fast food chain announced Wednesday.
In the third quarter ended Sept. 30, the global same-store sales of the fast food giant increased 12.7 per cent compared to projections of a 10.31 per cent increase, according to Refinitiv IBES data.
McDonald’s has been increasing its market share from competitors by making investing in new menu items such as the crispy chicken sandwich and its “Famous Orders” campaign with pop stars like South Korean boy band BTS and rapper Saweetie, also aided by the r=easing of the pandemic induced restrictions and restaurants opening at full capacity.
A new loyalty program has been introduced by the company in the United States as well as increased its advertising budget as it focuses more on its efforts to increase digital sales.
The strong performance of McDonald’s stands in stark contrast to those from some of the other restaurant chains, such as Domino’s Pizza Inc and Burger King owner Restaurant Brands International Inc – with both the global food chain companies reporting a slowdown in their business owing to the labor shortage.
In order to keep up with rising labor expenses and food inflation, some fast-food restaurants, including McDonald’s, have been forced to raise menu pricing.
There was a 9.6 per cent surge in comparable sales in the United States or McDonald’s in the latest completed quarter which was more than what analysts were expecting. This, according to the company was partly because of the increase in menu prices and customers buying more products for a single order.
With the easing of restrictions imposed because of the coronavirus pandemic, there was a return to strong sales for the company for most of its overseas markets, including the UK, Canada, and Japan. However, the resurgence of Covid-19 infections in Australia and China put its business in these two markets under pressure.
In the reporting quarter, McDonald’s total sales grew 14 per cent to $6.20 billion, exceeding forecasts of $6.03 billion.
Net income increased by 22% to $2.15 billion, with adjusted earnings of $2.76 per share, exceeding projections of $2.46 per share.
(Adapted from LiveMint.com)