Globally popular fast food chain McDonald’s has suffered its first quarterly profit decline in two years, mainly due to rising inflation, including domestic budget preferences and boycotts due to Middle East conflicts.
Reuters reported that sales growth fell to 1.9 percent for the fourth consecutive quarter, while the company said consumers are “using every dollar wisely.”
According to McDonald’s, rising inflation has pushed low-income earners toward value deals and away from higher-priced meals, including Big Macs.
The previous such decline was in 2020, when McDonald’s sales were also affected due to the global pandemic Corona and lockdowns around the world.
Explanation of ‘McDonald’s Pakistan’ for giving free food to Israeli army
Contemporaneous food chains, including McDonald’s, have had to raise prices over the past year due to rising prices of eggs and other raw materials, affecting low-income earners.
According to McDonald’s, their income in Japan, Latin America and Europe was slightly better, while in the United States, compared to last year, the income was declining.
It should be noted that after the United States, McDonald’s is the largest market in the Middle East and China food chain. In this regard, in March, McDonald’s CFO Ian Borden warned about a decline in revenue in the first quarter. In which the main reason is that McDonald’s is pro-Israel where it has been facing a boycott.
A boycott campaign against other major Western brands, including Macedon, is also underway after their pro-Israel stance. Last quarter, food chain Starbucks forecast a decline in its annual sales as its stores in the Middle East fell.
McDonald’s faced severe criticism for its announcement of providing free food to Israeli forces
In October, McDonald’s faced a backlash in several Muslim countries after the food chain in Israel announced that it would provide free meals for Israeli soldiers.
Later in December, Macedon Malaysia sued a movement promoting a boycott against Israel for “false and defamatory statements”. The food chain claimed that its business had suffered.
North Coast Research analyst Jim Sanderson said the impact of Israel’s war on Palestine in the Middle East will put pressure on all American brands, and it is not difficult to imagine that branches of the food chain in these Muslim countries can also cover their operational costs. will
Adjusted earnings per share came in at $2.70, missing estimates of $2.72, according to LSEG data. Selling, general and administrative expenses rose 10 percent, driven by investments in digital as well as restructuring efforts.
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2024-08-05 17:49:57
