The first numbers are coming in from the fast-food value meal wars. Unfortunately, McDonald’s earnings were not the blockbuster they hoped for. Nevertheless, Golden Arches executives have assured investors that they have a plan…
Earlier this year, McDonald’s released a $5 value meal to combat declining sales over the Summer. The promotion intended to entice price-sensitive customers back to the restaurants.
However, this was not the case as McDonald’s Q2 earnings report disclosed.
IN CONTRAST, SAME-STORE SALES FELL FOR THE CHAIN FOR THE FIRST TIME SINCE 2020.
Still, this situation is not a Maccie’s problem alone. Consumers are not choosing to dine at other quick-service eateries, either…
According to a Lending Tree survey, 78% of Americans consider fast food a luxury. As a result, they are eating out there less often.
With that in mind, the Golden Arches will take a “forensic approach” to address the issue…
McDonald’s is Confident Earnings Will Rebound
Despite Q2 numbers falling below expectations, McDonald’s value meal had some positive impacts.
Namely, an 8% rise in store traffic during the promotion and better customer perception.
From these results, McDonald’s executives are sure they can turn their earnings around. On the investor call, CEO Chris Kempczinski said:
“For 70 years we’ve led on value because it’s what the brand stands for and frankly … we have an underlying competitive advantage that we can buy at a lower price than anybody else in our industry. The point is, we know how to do this. We wrote the playbook on value and we are working with our franchisees to make the necessary adjustments.”
Via CNBC
The first step in this process seems to be extending the value meal deal beyond its original timeframe.
And, we’ll see the impact of these adjustments next quarter.
Be Great,
GCTV Staff
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