McDonald's delivered mixed quarterly results on Wednesday, posting earnings that exceeded Wall Street expectations while facing a downturn in customer traffic at its American restaurants. The fast-food giant reported a 0.2% decrease in sales at U.S. locations open for at least 13 months. Although this represents a decline, the performance was better than the 0.5% drop anticipated by analysts surveyed by StreetAccount.
Financially, the company outperformed revenue projections. Adjusted earnings per share came in at $3.57, surpassing the expected $3.38. Net revenue rose 1% to $7.16 billion, though this figure fell short of the $7.29 billion forecast by LSEG analysts. On a non-GAAP basis excluding restructuring charges, McDonald's earned $3.57 per share compared to the year-ago figure of $3.18 per share. The fiscal third-quarter net income totaled $2.49 billion, up from $2.28 billion in the same period last year.
CEO Chris Kempczinski noted that while the U.S. business had previously struggled with execution on value offerings, there were signs of improvement as the quarter progressed following strategic interventions. This follows comments made by Kempczinski in August regarding shortfalls in implementing value strategies to attract budget-conscious diners. Despite the domestic challenges, global same-store sales rose 1.5%, beating analyst expectations of a 1.3% increase.
International performance was a key driver for the company's overall growth. The developmental licensed markets division, which includes major economies like Japan and China, saw same-store sales grow by 4.2%, significantly outpacing the 2.1% forecast. Conversely, the international operated division, covering markets such as Australia and Germany, recorded a 1.4% increase in same-store sales, underperforming against the projected 2.1% rise. The company identified France as a specific weak spot within this segment.
Sources: CNBC Markets.