McDonald's reports lower Q2 sales, charges weigh down profit

By AP News

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McDonald’s sales fell short of expectations in the second quarter, a sign that inflation and menu price increases could be taking a toll on U.S. demand.

McDonald’s sales fell short of expectations in the second quarter, a sign that inflation and menu price increases could be taking a toll on U.S. demand.

The Chicago burger giant said its revenue fell 3% to $5.72 billion in the April-June period. That was short of Wall Street’s forecast of $5.8 billion, according to analysts polled by FactSet.

McDonald’s said same-store sales, or sales at stores open at least a year, were up nearly 10% worldwide. That was higher than the 6.8% that analysts had expected.

U.S. same-store sales were up 3.7%. Earlier this spring, McDonald's said it was starting to see some consumers trade down to lower-priced items or order fewer items at a time.

McDonald’s said its earnings fell 46% to $1.19 billion. That included $1.2 billion in charges related to the sale of its 850 stores in Russia.

McDonald’s temporarily closed its Russian stores in March but continued paying its 62,000 employees. In mid-May, McDonald’s sold its Russian restaurants to a McDonald’s licensee who operates 25 restaurants in Siberia. The restaurants began reopening last month under a new name: Vkusno-i Tochka (Tasty-period).

Excluding one-time items, McDonald's earned $2.55 per share. That was ahead of Wall Street’s forecast of $2.45 per share.

McDonald's shares were up slightly in premarket trading.

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Consumer Discretionary

Author: AP News

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Originally published by Associated Press Valuethemarkets.com, Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

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