Customers dine at a McDonald's restaurant in Chicago, Ill., in May 2025.Scott Olson/Getty Images
McDonald’s MCD-N on Tuesday missed U.S. sales growth expectations for the second quarter as consumers cut back restaurant spending due to economic worries and despite the burger giant’s value deals to draw lower-income diners.
Comparable sales in the largest market for McDonald’s grew 0.8 per cent, below analysts’ estimates of a 1.06-per-cent rise, according to data compiled by LSEG. The pace of growth in the U.S. was 2.5 per cent a year ago.
Higher prices for basic goods and fuel have left lower-income consumers, a key customer base for McDonald’s, with less money to spend on eating out.
“While our playbook is working around the world, we see an opportunity to raise the bar in the U.S. and accelerate performance in our largest market,” CEO Chris Kempczinski said.
He had warned in May that rising macroeconomic uncertainty, including concerns linked to the Iran conflict, was hurting consumer spending.
McDonald’s has spent the past year leaning heavily on affordability and promotions to defend market share against intensifying competition from fast-food rivals, convenience stores and at-home meal consumption.
Its efforts included a revamped McValue platform, an under-$3 menu, discounted breakfast offers and a broader push into specialty beverages such as refreshers and crafted sodas.
McDonald’s lowering value meal prices as cash-strapped customers cut back
Those initiatives were offset by muted demand and difficult year-ago comparisons, as the company lapped the successful Minecraft-themed meal and Snack Wrap promotions that boosted customer visits.
Globally, comparable sales rose 1.3 per cent, slowing from a 3.8-per-cent jump a year ago. Sales in McDonald’s international operated markets segment, which includes major countries in Europe, rose 1.5 per cent, down from 4 per cent a year earlier.
Analysts had expected softer demand in the region as higher energy costs and heat wave conditions curbed spending on dining out.
Sales in its business segment, where restaurants are operated by local partners, slowed to 1.9 per cent from 5.6 per cent a year ago.
Net income in the second quarter rose 5 per cent to US$2.36-billion. On an adjusted basis, McDonald’s earned US$3.38 per share, up from US$3.19 a year earlier.
Shares of the company, which had lost nearly 13 per cent of their value this year, were up about 2.5 per cent in premarket trading.
McDonald’s also named company veteran Skye Anderson to lead its U.S. business, replacing Joe Erlinger, who is leaving the fast-food chain after more than two decades.