According to the fast food chain, same-store sales fell by 1% in the second quarter of 2020, marking the first decline since the COVID-19 outbreak forced thousands of locations to close in the first few months of the year.
The company is “working to fix that with pace,” according to CEO Chris Kempczinski, who is under pressure to acknowledge that it is “clear that our value leadership gap [over rivals] has recently shrunk.”
He did, however, acknowledge that over the upcoming few quarters, same-store sales—that is, revenues at locations that had been open for at least a year—were also probably going to decline.
The period’s total revenue remained constant at $6.5 billion, but net income decreased by 12% to $2 billion, according to the figures.
McDonald’s attributed the numbers to the “continuing impact of the war in the Middle East,” lower demand in China, and a decline in its customer base in the US that was somewhat offset by price increases.
Mr. Kempczinski defended higher menu prices by pointing out that in some markets, the expenses of paper, food, and staff had jumped by as much as 40%.
According to industry-wide data, US fast food companies have seen a 2% decline in customers so far this year as a result of inflationary pressures.
