McDonald's US sales decline for first time in six quarters despite value push
Nov 4 (Reuters) - McDonald's MCD.N reported a bigger-than-expected decline in US sales as financially stretched consumers cut back on dining out, extending a slowdown that has tested the burger chain's efforts to win back lower-income diners with value meals.
Over the last two years, McDonald's has rolled out a series of offers such as an under-$3 menu and a $4 breakfast meal as higher living costs force consumers to opt for cheaper alternatives from rivals, convenience stores and home-cooked meals.
Comparable sales in McDonald's largest market fell 0.2% in the quarter ended September 30, missing analysts' expectations for a 0.1% fall, according to data compiled by LSEG. It was the company's first such decline after five quarters of growth.
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Customer traffic remained under pressure in the third quarter, and visits to McDonald's restaurants fell 4.6% in the three-month period from a year earlier, according to data firm Placer.ai.
Traffic also remained below year-ago levels in October despite the return of McDonald's Monopoly promotion and Halloween-themed Boo Buckets.
CEO Chris Kempczinski said in a statement on Wednesday that the company was "encouraged by improvement as the quarter progressed following our intervention on value." Chief Financial Officer Ian Border had told investors at a September 23 event that US sales would likely be negative for the quarter, but that September would likely be positive.
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Rival Burger King's parent Restaurant Brands International QSR.TO topped sales expectations last week, helped by discounts and promotions. Yum Brands YUM.N said on Tuesday Tex-Mex chain Taco Bell's sales have returned to growth following a food safety-related hit.
McDonald's global comparable sales rose 1.5%, in line with expectations.
Adjusted earnings rose to $3.57 per share from $3.22 a year earlier, helped by a roughly 4% decline in operating costs and expenses.