McDonald's shares rose as it reported higher comparable sales despite missing analyst expectations on profits
John MACDOUGALLFast-food giant McDonald's scored solid sales growth Wednesday following promotions to attract struggling consumers, with company shares rising despite profits missing expectations.
The restaurant chain, which unveiled new "Extra Value Meals" in September in the United States, has encountered a "bifurcated" consumer market, according to CEO Chris Kempczinksi.
"We continue to remain cautious about the health of the consumer in the US and our top international markets and believe the pressures will continue well into 2026," Kempczinksi said on a conference call with analysts.
Profits in the third quarter edged up 1 percent to $2.3 billion, while revenues rose 3.0 percent to $7.1 billion.
The company began offering competitively-priced packages in September, with the $8 Big Mac meal including a medium soft drink and medium-sized French fries.Â
Offerings in November include packages built around sausage and chicken. McDonald's has launched similar efforts in leading overseas markets.
The offerings helped the chain garner a 2.4-percent increase in comparable sales in the United States during the quarter, while global growth was 3.6 percent.
The promotions enhance McDonald's image for providing "reliable value," said Kempczinksi, who pointed to inflation in the price of beef and some other key food items as an ongoing challenge.
"All of this just keeps putting pressure on the industry," he said. "This is an environment where you've just got to grind it out."Â
To secure support for the promotions from McDonald's franchisees, the company is financing half the cost of promotion, said Chief Financial Officer Ian Borden.
That sum was about $15 million for September. The company expects about $75 million in these costs in the fourth quarter, Borden said.Â
Shares of McDonald's rose 2.8 percent in afternoon trading.
jmb/aha
Originally published on doc.afp.com, part of the BLOX Digital Content Exchange.
Information from the News and our advertisers (Want to add your business to this to this feed?)
Success! An email has been sent to with a link to confirm list signup.
Error! There was an error processing your request.
Sign up to receive notifications when a new Columbia Gorge News e-Edition is published.
Would you like to receive our news updates? Signup today!
Receive weekly updates on obituaries and death notices.
Oregon Capital Press presented by Columbia Gorge News
Receive updates on upcoming promotions and special sections.
Receive weekly updates on local sports news.
Sorry, there are no recent results for popular videos.
Sorry, an error occurred.
Already Subscribed!
Cancel anytime
Thank you .
Your account has been registered, and you are now logged in.
Check your email for details.
Submitting this form below will send a message to your email with a link to change your password.
An email message containing instructions on how to reset your password has been sent to the email address listed on your account.
No promotional rates found.
Secure & Encrypted
Thank you.
Your gift purchase was successful! Your purchase was successful, and you are now logged in.
| Rate: | |
| Begins: | |
| Transaction ID: |
A receipt was sent to your email.
Commented
Sorry, there are no recent results for popular commented articles.