McDonald’s Anticipates Earnings Announcement Amidst Sales Disruptions and Store Closures
Following a disappointing fourth quarter, McDonald’s is preparing to unveil its first-quarter financial results before market hours on Tuesday. Wall Street analysts predict earnings per share of $2.72 and revenues of $6.16 billion.
The fast-food behemoth encountered sales setbacks in the previous quarter, primarily driven by boycotts in the Middle East and the temporary closure of some locations due to safety concerns surrounding protests. Boycotts emerged in response to discounts offered by McDonald’s Israeli licensee to soldiers, affecting sales not only in the region but also in other markets globally.
This month, McDonald’s announced its acquisition of 225 restaurants operated by its Israeli franchisee. Meanwhile, in the United States, low-income consumers have been reducing their spending at the burger chain, a trend that Wall Street anticipates will persist in the current quarter. StreetAccount estimates predict a meager 2.6% growth in domestic same-store sales.
As a result of these challenges, McDonald’s stock has lost 7.7% of its value year-to-date, resulting in a market valuation of $197 billion.
