McDonald’s has reported a surprise increase in global comparable sales for the fourth quarter, driven by strong demand in the Middle East and Japan. The company saw its shares rise nearly 5% in early trading, despite a significant drop in US sales due to an E coli outbreak.
US sales fell by 1.4%, the largest decline since 2020, while international sales rose by 4.1%. The growth was largely attributed to value meals and discounted offerings in the Middle East, Japan, and China. Demand for cheaper items has helped McDonald’s recover traffic from lower-income consumers, but this expansion of value may pressure store profits.
The company extended its $5 meal deal into December, which prompted US diners to buy more, with an average transaction size of over $10. The discount push continues, targeting budget-conscious dinners, including a new Chicken Big Mac and snack wrap releases.
While customer traffic increased slightly in the fourth quarter, this was offset by a smaller amount spent per visit. An E coli outbreak in October temporarily suspended sales of Quarter Pounder hamburgers in 14 US restaurants for two weeks, still affecting the region but expected to subside by April.
Global same-store sales rose 0.4%, beating expectations, driven by a 4.1% rise in local partner-operated segments, particularly in the Middle East and Japan. The company aims to have 50,000 units worldwide by 2027.
Source: https://www.reuters.com/business/retail-consumer/mcdonalds-posts-biggest-us-sales-decline-nearly-five-years-2025-02-10