The CEO of McDonald’s just announced a big slowdown in revenue growth and customer traffic, with sky-high prices for BigMacs causing customers to stop coming. The result is that McDonalds and the rest of the fast food industry is in a recession – one that they might not climb out of.
Same-store sales declines by almost -1% YoY, with customer traffic dropping closer to -5% given that McDonald’s franchisees are still increasing prices.
Other fast food restaurants like KFC, Pizza Hut, Wendy’s, and Cheesecake Factory are reporting similar declines in sales. Suggesting that US consumers no longer have the money to afford going out to eat at these restaurants. This implies that a recession is hitting these companies and the fast food industry at large.
Two years of high inflation and low consumer sentiment is one reason why sales are dropping. Another reason is because these restaurants significantly increased their menu prices, and now people are choosing to eat at home.
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Sources:
www.consumeraffairs.com/news/mcdonalds-sales-drop-for-the-first-time-since-2020-073024.html
www.msn.com/en-us/money/companies/mcdonald-s-same-store-sales-fall-for-the-1st-time-since-the-pandemic-profit-slides-12/ar-BB1qOwqW
www.newsweek.com/mcdonalds-sales-drop-globally-first-time-years-1931824
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