McDonald’s on Wednesday reported mixed quarterly results as traffic to its U.S. restaurants fell, leading to a slight decline in domestic same-store sales.
The fast-food giant reported a 0.2% decrease in sales at its U.S. restaurants that have been open at least 13 months. Even so, the segment performed better than the 0.5% decline that Wall Street anticipated, according to a survey of analysts by StreetAccount.
“In the U.S., we’re encouraged by improvement as the quarter progressed following our intervention on value,” McDonald’s CEO Chris Kempczinski said in a statement.
McDonald’s same-store sales returned to growth in September after falling in July and August, CFO Ian Borden said on the company’s earnings conference call. However, in response to an analyst question, he clarified that he did not say that U.S. same-store sales would be better in the fourth quarter.
Kempczinski said in August that the company’s U.S. business was falling short on execution, particularly on the implementation of its value offerings. Like many restaurants, McDonald’s has leaned into discounts to attract budget-conscious diners over the last two years.
To reverse same-store sales declines, McDonald’s focused its marketing on its Extra Value Meals and restarted regional and national promotions on its mobile app, which are important to its most frequent diners.
As McDonald’s tries to regain its footing in the U.S., the chain is also testing two new value menus, one with mix and match bundles and the other with set combinations of menu items, executives said on the earnings call. The offering that resonates the most with customers and franchisees will be rolled out across the U.S. in early 2027.
Shares of the company rose about 5% in morning trading.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
The company reported third-quarter net income of $2.49 billion, or $3.51 per share, up from $2.28 billion, or $3.18 per share, a year earlier.
Excluding restructuring charges and other items, McDonald’s earned $3.57 per share.
Net revenue rose 1% to $7.16 billion.
The company’s same-store sales rose 1.5%, lifted by its international segments. That topped analysts’ expectations of a 1.3% increase, according to StreetAccount.
McDonald’s international developmental licensed markets business, which includes Japan and China, reported same-store sales growth of 4.2%. Wall Street was forecasting same-store sales to rise 2.1% for the division, based on StreetAccount estimates.
The company’s international operated division, which includes top markets like Australia and Germany, saw same-store sales growth of 1.4%. Still, the business underperformed Wall Street’s expectations. Analysts were projecting same-store sales would rise 2.1%, according to StreetAccount.
“In the majority of our large international markets, we’re holding or gaining share,” Borden said on the company’s conference call. “It’s a soft consumer environment, but we’re doing well.”
France was a weak spot, McDonald’s said. Kempczinski said that franchisees in France recently voted on a strategy to turn the business around. In addition to a softer economy in the country, McDonald’s has also seen short-term disruptions related to student protests.
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