McDonald’s Faces Slower Sales Growth in Q4 Amid Middle East Turmoil
Shares closed down 3.73% on Tuesday.
Karobar
McDonald's Corp fell short of market expectations in the fourth quarter of 2023, primarily impacted by the ongoing conflict in the Middle East.
In its earnings report on Monday, the company highlighted positive comparable sales in all geographic regions, except for the Middle East, which suffered due to the regional conflict.
Comparable sales, a crucial metric for the restaurant industry, saw a modest 3.4% quarter-over-quarter increase during this period, marking the slowest growth since the fourth quarter of 2020. The International Developmental Licensed Markets segment was particularly affected, with only a 0.7% increase. Other segments also experienced a slowdown, with the U.S. showing a 4.3% increase, and the International Operated Markets segment rising by 4.4% over the quarter.
Earlier in the year, McDonald’s Corp’s CEO, Chris Kempczinski, acknowledged a "meaningful business impact" in the Middle East due to the conflict between Israel and Hamas.
Diluted earnings per share during the review period were $2.95, marking a 14% increase (11% in constant currencies) and surpassing market expectations by approximately 4.4%.
