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Key Takeaways
- McDonald’s shares slipped close to 4% Wednesday after its CFO said the fast-food chain faced a challenging environment hindering sales in the opening months of 2024.
- McDonald’s CFO Ian Borden said lower-income customers have been pulling back spending on fast food and other types of restaurants.
- The fast-food giant said it wants to raise its share of the chicken market, and plans to test a bigger burger.
McDonald’s (MCD) shares fell nearly 4% Wednesday after the fast-food chain’s chief financial officer (CFO) said at an investor conference that lower-income customers of the company are choosing to eat out less often.
CFO Ian Borden said at an event Wednesday that concerns about inflation and possibly depleted pandemic savings mean many consumers are spending less on fast food and other kinds of restaurants.
“You’re starting to see food-at-home inflation versus food-away-from-home getting back to its more, I think, historical dynamic, which means I think some of those consumers are just choosing to eat at home more often,” Borden said.
Borden also touched on severe winter weather in January that affected sales, and performance in some countries like France, China, and regions like the Middle East that have started the year below expectations.
Last month, McDonald’s reported a negative effect on sales from boycotts tied to the Israel-Hamas war. During Wednesday’s presentation, Borden said, “we continue to deal with the impacts of the war in the Middle East.”
Borden also said McDonald’s wants to increase sales in areas like chicken-based menu items, and plans to test a few larger burger options. Another area Borden said the company wants to improve is coffee, both in overall taste and the consistency customers get across different locations.
McDonald’s shares finished almost 4% lower Wednesday at $282.86. They’ve lost close to 5% of their value so far this year.