McDonald's sales drop for first time since 2003
November 8, 2012
McDonald's Corp. reported its first decline in monthly U.S. same store sales in nine years Thursday, as the chain began to suffer problems plaguing the rest of the fast food industry for several years.
Sales at restaurants open more than a year declined 2.2 percent. Same store sales also declined in Europe, 2.2 percent, and the Asia Pacific, Middle East and Africa region, 2.4 percent.
The chain cited lower demand and greater competition for the lower sales. While hamburger competitors Burger King and Wendy's were walloped by the onset of the recession, both have changed hands in recent years and launched new menu items that better compete with McDonald's including expanded breakfast offerings, improved coffee options and more innovative salads.
"Though October's sales results reflect the pervasive challenges of today's global marketplace, I am confident that our strategies and the adjustments we are making in response to the current business headwinds will build sales momentum and drive sustained, profitable growth," McDonald's CEO Don Thompson said.
Although the decline is historic for the world's largest restaurant chain, which has been on a roll since the beginning of its historic turnaround in 2003, it was not unexpected. Analysts have been tempering expectations and downgrading the stock for months.
To rev up sales, McDonald's has been working to emphasize value in markets around the world.