McDonald's earnings: Sales growth tops estimates as prices, traffic boost results - Yahoo Finance

McDonald's (MCD) reported first quarter results Tuesday that beat expectations as sales were boosted by higher prices and more customer traffic.

The company reported same-store sales rose 12.6% in both the US and abroad, beating estimates across the board as revenue and earnings per share also topped forecasts. Wall Street analysts expected same-store sales would rise 7.5% in the US and 8.2% on a global basis.

Shares of the fast food operator were down about 1% following these results. Year-to-date McDonald's stock is up more than 10% against a 7% gain for the S&P 500.

Here are the key figures from McDonald's first quarter report compared to Street estimates, according to data from Bloomberg:

• Revenue: $5.9 billion vs. $5.58 billion expected

• Adjusted earnings per share: $2.63 vs. $2.31 expected

• Same-store sales: +12.6% vs. 8.2% expected

  • US same-store sales: +12.6% vs. +7.5%expected

  • International Operated markets same-store sales: +12.6% vs. +9.3 %

  • International Development Licensed Markets: +12.6% vs. +10.2%

The company reported charges of $180 million, or 18 cents per share, related to its restructuring plan.

"Our strong first quarter results demonstrate that our Accelerating the Arches strategy is working, as comparable store sales grew 12.6% through a healthy balance of strategic menu price increases and positive traffic growth," McDonald's CEO Chris Kempczinski said in a release.

In the US, sales were boosted by higher menu prices and positive guest count growth, the company said. Marketing campaigns featuring core menu items like the Cardi B & Offset Meal, in addition to continued digital and delivery growth, led to sales up 12.6% in the first quarter.

Same-store sales in McDonald's international markets also rose 12.6% during the quarter.

A car goes through the drive-thru at a McDonald's restaurant on April 03, 2023 in San Pablo, California. (Photo by Justin Sullivan/Getty Images)

Recessionary environment expected later on this year

On the company's earnings call, executives reiterated expectations for a "mild recession" in US this year. In Europe, they expect to see a "more challenging" environment, but better than what the second half of 2022.

A shift in consumer behavior is also underway, in the company's view.

In most of its markets around the world, McDonald's has seen a slight decrease in the number of items in orders — including add-ons like french fries — though the company has mostly been able to pass along higher prices. CFO Ian Borden said the company is seeing "resistance to pricing" in some areas, however, with this resistance picking up since the beginning of the year.

Still, Borden and the team remain optimistic, saying, "in good times or bad times McDonald's tend to do well."

Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.

For the latest earnings reports and analysis, earnings whispers and expectations, and company earnings news, click here

Read the latest financial and business news from Yahoo Finance

Adblock test (Why?)

Article From & Read More ( McDonald's earnings: Sales growth tops estimates as prices, traffic boost results - Yahoo Finance )
https://ift.tt/Mm8ZlJa
Business

Bagikan Berita Ini