Latest news with #ChrisKempczinski
Yahoo
4 days ago
- Business
- Yahoo
The Top 5 Analyst Questions From McDonald's's Q1 Earnings Call
McDonald's faced a challenging Q1, as revenue came in below Wall Street expectations and same-store sales declined. Management attributed these results to mounting economic pressure on lower and middle income consumers, particularly in the U.S., where CEO Chris Kempczinski noted, 'QSR traffic from middle income consumers fell nearly as much as the low income cohort.' Severe weather, continued inflation, and broader macroeconomic uncertainty also weighed on performance. Despite these headwinds, McDonald's highlighted traction from its new value platforms and global marketing efforts, aiming to stabilize traffic amid a shifting industry landscape. Is now the time to buy MCD? Find out in our full research report (it's free). Revenue: $5.96 billion vs analyst estimates of $6.12 billion (3.5% year-on-year decline, 2.7% miss) Adjusted EPS: $2.67 vs analyst estimates of $2.67 (in line) Operating Margin: 44.5%, in line with the same quarter last year Locations: 43,756 at quarter end, up from 42,018 in the same quarter last year Same-Store Sales fell 1% year on year (1.9% in the same quarter last year) Market Capitalization: $209 billion While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Dennis Geiger (UBS) asked how U.S. sales momentum could improve following strong marketing campaigns; CEO Chris Kempczinski emphasized that execution on value and menu innovation will be critical for growth. David Palmer (Evercore) questioned the divergence in international market performance versus the U.S.; CFO Ian Borden highlighted positive share gains where value and menu innovation aligned, despite ongoing inflation. David Tarantino (Baird) pressed on whether sharper entry-level price points are necessary; Kempczinski noted the $5 Meal Deal's incrementality and flexibility in adapting value menus. John Ivankoe (J.P. Morgan) asked about core menu price variability and the outlook for menu innovation in chicken; Kempczinski stressed local pricing discipline and the anticipated halo effect from the McCrispy platform. Eric Gonzalez (KeyBanc) questioned if there is enough premium product innovation to sustain sales beyond short-lived promotions; Kempczinski pointed to a pipeline of new menu news throughout the year to support baseline growth. In the coming quarters, the StockStory team will closely watch (1) the effectiveness of McValue offerings and the impact of new product launches in driving guest count recovery, (2) margin stability as inflation and mix shifts play out across regions, and (3) progress in key international markets, including the U.K. and France, as localized strategies are deployed. Execution on beverage initiatives and technology integration will also be important indicators of McDonald's ability to adapt and compete. McDonald's currently trades at $292.70, down from $319.62 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it's free). The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today. Sign in to access your portfolio
Telegraph
7 days ago
- Business
- Telegraph
‘McDonald's? Meh': how the fast food giant lost its grip on Britain
When McDonald's opened its first UK restaurant in Woolwich, south-east London, in 1974, thousands queued to get a taste of its legendary burgers and fries. Their enthusiasm was a sign of things to come: in the decades since, McDonald's has grown to become Britain's biggest restaurant chain. Today it has almost 1,500 sites across the country and almost £2bn in annual revenues. Yet Britain's enduring love affair with the once-glamorous 'golden arches' is on the rocks. Sales have fallen amid a backlash over price increases, while both cheaper rivals such as Greggs and more upmarket fast food offerings such as Wingstop are luring away customers. With its ubiquitous presence on Britain's high streets and comparative lack of glamour, McDonald's has been caught in a pincer movement between cheaper rivals and upmarket chains – leaving it adrift in the viciously competitive dining market. 'It is faced with customers trading down into cheaper alternatives and independent fast food and then you've got people trading out, going up into the cool, trendy brands,' says Simon Stenning, the director of Future Foodservice, a consultancy. McDonald's leadership team in America has repeatedly singled out the UK as one of its most difficult markets, warning that negative comparable sales in Britain are dragging on international performance. Speaking to investors last month, Chris Kempczinski, its chief executive, said: 'The UK is not yet gaining share. There's still work for us to do in the UK. The share losses are to the people that we should be beating.' McDonald's has been hit by sharp increases in the cost of ingredients and staff in recent years, forcing the chain to raise prices, angering customers in the process. The price of a Big Mac has risen to around £4.89 from £2.99 in 2020, while a Double Cheeseburger has risen from £1.49 to £2.29 over the same period. A large Big Mac meal costs about £7.59. Though it is still one of the cheaper meals on the high street, experts say the inflation has particularly hurt McDonald's because it has more customers on lower incomes than other chains. 'McDonald's is a bit like JD Wetherspoon: all human life is there,' says Peter Martin, the founder of hospitality consultancy Peach 20/20. 'You've got a big chunk of that who are much more price-sensitive.' 'A lot of its customer base is struggling financially at the moment or are worried about outlook for finances and therefore being a bit more careful with their spending,' adds Eleanor Scott, a travel and leisure specialist at PwC. 'A Big Mac is a 'known value' item. People know how much it costs, and if that changes, they notice,' she says. 'For a lot of other operators, that just isn't the case.' She adds: 'If you put 40p on a £2 product, it's a lot more noticeable as a percentage than putting 40p on a £5 product. Their price point makes that a lot more visible.' Last year, Greggs overtook McDonald's to become the UK's most popular breakfast location as shoppers sought out even cheaper meals. Greggs sells a breakfast roll with a cold drink for £2.95, while a savoury bake and a hot drink cost £3.55. In a financial update in February, Kempczinski alluded to the threat posed by Greggs, saying: 'You have a very strong local competitor [in the UK] who's been very aggressive from a value standpoint, particularly on breakfast.' But it goes beyond Greggs. Stenning says there is 'an awful lot of cheaper independent fast food' challenging McDonald's on price at the lower end too. McDonald's has introduced a £5 meal deal in a bid to restore its reputation for cheap prices. But it faces a battle on another front. Newer, more premium brands such as Wingstop and Popeyes are drawing attention away. 'If you're young and in the right demographic, Wingstop or Dave's Hot Chicken is absolutely the place to be, to be seen, to take all your photos and all that malarkey,' says Stenning. 'McDonald's? Meh.' 'There's so many brands coming in. There's so much choice,' adds Martin. 'I don't think McDonald's are going to go away, just like Burger King's not going to go away, or KFC – but they're going to have to react.' Walk into any McDonald's today and the scene is very different from the hustle and bustle that greeted diners in Woolwich 50 years ago. McDonald's restaurants have been criticised for becoming less welcoming in recent years after the business ramped up its use of self-checkout kiosks. Instead of walking up to the till and speaking to a member of staff, customers are faced with impersonal screens to key in their orders. 'I don't think the screens help, because that means a whole bunch of people are standing around the tills and queues are stretched throughout the store,' Amir Mousavi, the founder of The Good Food Studio, a restaurant consultancy. The masses of delivery riders that wait outside its stores to pick up orders have proved divisive in some parts of the country too. Last month, a group of Fulham residents launched a campaign to block plans for 24-hour trading at a local McDonald's. They argued the site had become a hotbed of crime and that groups of delivery riders crowding the site were blocking access to their homes. 'People are really p----d off with delivery drivers,' says Martin. 'That is a real issue.' Many of McDonald's newer sites are now designed with riders in mind – some even have their own dedicated waiting rooms. The business has even opened sites that cater solely to delivery orders. But this is a much trickier feat to pull off on busy high streets. 'The more out-of-town sites are being designed with that in mind, but legacy sites haven't,' Martin says. 'If you're building from scratch, it's easier to segregate.' McDonald's woes in the UK have also been compounded by the impact of a sexual harassment scandal at the chain in recent years. Alistair Macrow, its UK chief executive, was hauled before the business and trade select committee for a second time this year after the BBC unearthed more than 100 complaints. The company has launched a clampdown on sexual harassment in its stores, telling the BBC in March it had implemented 'everything from enhanced training programmes and onboarding practices, through to the launch of a new digital speak-up channel designed with our franchisees' restaurant crew in mind'. At the same time, it faced boycotts from pro-Palestinian customers after its former Israeli franchisee gave free meals to Israeli soldiers. McDonald's bought back the Israeli business in 2024 after calls for boycotts caused a slump in global sales. Kempczinski called the boycotts 'disheartening and ill-founded', blaming them on 'misinformation'. Whether these last two issues will tangibly hurt the British business is debatable. 'I don't think for ordinary people it makes a lot of difference, quite frankly,' says Martin. Regardless of its challenges, McDonald's has vowed to keep investing in the UK, announcing plans last year to spend £1bn on opening 200 new restaurants, in a move it claims will create over 24,000 new jobs by 2028. But one thing is certain: it won't be smooth sailing for the fast food giant from here on out. A McDonald's spokesman said: 'The long-term investment in our menu, our people, our restaurants and our communities has seen our share of the market grow significantly since Covid-19, and in the past five years our growth has been three times that of our nearest competitor. 'There is no escaping the fact that the economic environment remains challenging for consumers – but this makes our role as a reliable, affordable brand that people can trust more important than ever before.' He added: 'There is a huge amount of opportunity in the UK market, and we are focused on both delivering that growth and delivering for our customers.'
Economic Times
03-06-2025
- Business
- Economic Times
McDonald's popular menu item to make a comeback at US restaurants next month. Here's when
McDonald's is bringing back the Snack Wrap to its menu after several years of social media interactions on the topic finally prompted the fast-food chain to act. Starting July 10, the Snack Wrap returns to participating restaurants nationwide. Customers can snag the Snack Wrap à la carte or as a combo meal, which includes two Snack Wraps, medium fries, and a drink of choice. According to McDonald's, the Snack Wrap was phased out nationally in 2016, but it "never left fans' hearts." Tired of too many ads? Remove Ads McDonald's brings back Snack Wrap Tired of too many ads? Remove Ads How can customers order Snack Wrap Tired of too many ads? Remove Ads McDonald's is back in the news again after it confirmed that the Snack Wrap will officially be coming back to restaurants permanently beginning Thursday, July 10. McDonald's snack wraps will return to US restaurants next month as the fast-food giant looks to boost sales after a sluggish start to the year, according to multiple media first launched its snack wraps nearly twenty years ago but removed them from the menu in 2016 due to their impact on kitchen efficiency. A few franchisees continued offering them until 2020, when the chain streamlined its menu during the Covid-19 pandemic to maintain faster service. The snack wraps were phased out alongside items like salads and Snack Wrap features one of McDonald's new McCrispy Strips – a juicy chicken strip made with all white meat – topped with crisp shredded lettuce and shredded cheese, all wrapped in a soft flour tortilla, according to the item will be available in two flavors:Spicy: Bold, zesty and unapologetically fiery – our Spicy Snack Wrap brings the heat with a habanero kick that fans know and love from the Spicy McCrispy Smooth, rich and irresistibly savory – our Ranch Snack Wrap delivers a satisfying burst of cool ranch goodness, with hints of garlic and customers have long called for the return of snack wraps—starting petitions, making requests in drive-thru lanes, and tweeting daily at the company's official X account. Now, after years of demand, the wraps are making a comeback on July 10. The timing coincides with slowing sales, as cautious consumer spending led to a 3.6% drop in U.S. same-store sales during the first time around, the snack wraps will feature McDonald's McCrispy Strips, which debuted nationwide in May. They'll be available in two flavors: spicy and ranch.'There's clear demand for this product,' CEO Chris Kempczinski told analysts in May, reports CNBC. 'We want to ensure we're meeting our customers' needs.'Customers can order the Snack Wrap a la carte or as a combo meal, which includes two Snack Wraps, medium fries and a drink of choice, according to McDonald' celebrate the return of the item, McDonald's has launched a website they're calling "fans' VIP entry to all things Snack Wrap." "This is the content hub for the most anticipated menu item of the decade," the website's home page says. "Explore all the lore, like fan-inspired posts or merch concepts. And keep checking back because new files are added weekly."According to McDonald's, the Snack Wrap was phased out nationally in 2016, but it "never left fans' hearts.""From countless social media posts to full-fledged petitions, they never gave up on their favorite menu item. They're the ones who inspired us to make its return to the menu happen," McDonald's is expanding its focus beyond beef with new chicken offerings, tapping into one of the restaurant industry's fastest-growing categories. The rising popularity of chains like Chick-fil-A, Popeyes, Raising Cane's, and Dave's Hot Chicken has fueled this chicken return of McDonald's snack wraps could mark a new chapter in the ongoing "chicken wars." On Monday, Popeyes — owned by Restaurant Brands International — launched its own version: hearty Chicken Wraps wrapped in a biscuit-inspired tortilla, available for a limited time.
Time of India
03-06-2025
- Business
- Time of India
McDonald's popular menu item to make a comeback at US restaurants next month. Here's when
McDonald's brings back Snack Wrap Live Events How can customers order Snack Wrap (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel McDonald's is back in the news again after it confirmed that the Snack Wrap will officially be coming back to restaurants permanently beginning Thursday, July 10. McDonald's snack wraps will return to US restaurants next month as the fast-food giant looks to boost sales after a sluggish start to the year, according to multiple media first launched its snack wraps nearly twenty years ago but removed them from the menu in 2016 due to their impact on kitchen efficiency. A few franchisees continued offering them until 2020, when the chain streamlined its menu during the Covid-19 pandemic to maintain faster service. The snack wraps were phased out alongside items like salads and Snack Wrap features one of McDonald's new McCrispy Strips – a juicy chicken strip made with all white meat – topped with crisp shredded lettuce and shredded cheese, all wrapped in a soft flour tortilla, according to the item will be available in two flavors:Spicy: Bold, zesty and unapologetically fiery – our Spicy Snack Wrap brings the heat with a habanero kick that fans know and love from the Spicy McCrispy Smooth, rich and irresistibly savory – our Ranch Snack Wrap delivers a satisfying burst of cool ranch goodness, with hints of garlic and customers have long called for the return of snack wraps—starting petitions, making requests in drive-thru lanes, and tweeting daily at the company's official X account. Now, after years of demand, the wraps are making a comeback on July 10. The timing coincides with slowing sales, as cautious consumer spending led to a 3.6% drop in U.S. same-store sales during the first time around, the snack wraps will feature McDonald's McCrispy Strips, which debuted nationwide in May. They'll be available in two flavors: spicy and ranch.'There's clear demand for this product,' CEO Chris Kempczinski told analysts in May, reports CNBC. 'We want to ensure we're meeting our customers' needs.'Customers can order the Snack Wrap a la carte or as a combo meal, which includes two Snack Wraps, medium fries and a drink of choice, according to McDonald' celebrate the return of the item, McDonald's has launched a website they're calling "fans' VIP entry to all things Snack Wrap." "This is the content hub for the most anticipated menu item of the decade," the website's home page says. "Explore all the lore, like fan-inspired posts or merch concepts. And keep checking back because new files are added weekly."According to McDonald's, the Snack Wrap was phased out nationally in 2016, but it "never left fans' hearts.""From countless social media posts to full-fledged petitions, they never gave up on their favorite menu item. They're the ones who inspired us to make its return to the menu happen," McDonald's is expanding its focus beyond beef with new chicken offerings, tapping into one of the restaurant industry's fastest-growing categories. The rising popularity of chains like Chick-fil-A, Popeyes, Raising Cane's, and Dave's Hot Chicken has fueled this chicken return of McDonald's snack wraps could mark a new chapter in the ongoing "chicken wars." On Monday, Popeyes — owned by Restaurant Brands International — launched its own version: hearty Chicken Wraps wrapped in a biscuit-inspired tortilla, available for a limited time.
Time of India
03-06-2025
- Business
- Time of India
It's official: McDonald's is bringing back the snack wrap, and here's why this launch feels extra special
Live Events FAQs (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel McDonald's is bringing back the Snack Wrap after many years because fans kept asking for it online. You can buy it in U.S. stores starting July 10. It has a crispy chicken strip, some shredded lettuce, cheese, and is wrapped in a soft will be two flavors, Spicy which is bold, zesty, and fiery and Ranch which is smooth, rich, and savory. You can buy one wrap à la carte (alone) or as a combo meal with 2 wraps, medium fries, and a drink. McDonald's released a fun two-word press release: 'It's back', as per the Top McDonald's searches for Snack Wraps went up after the announcement. The Snack Wrap was removed in 2016 from all U.S. locations because it slowed down kitchen operations. Some restaurants still had it until 2020, when McDonald's cut menu items during the pandemic to keep service fast. When they removed Snack Wraps, salads and parfaits were also taken off the never stopped asking for the Snack Wrap, they started petitions, tweeted daily, and asked at drive-thrus. McDonald's said the loyal fans inspired the company to bring it had a slow start this year, with U.S. store sales falling by 3.6% in the first quarter. Now, the Snack Wrap is coming back and will use McCrispy Strips , a new chicken item launched in May CEO Chris Kempczinski said the market shows people want this product and the company wants to meet that need. This is part of McDonald's big push into chicken, not just beef, according to the CNBC restaurants like Chick-fil-A, Popeyes, Raising Cane's, and Dave's Hot Chicken are growing fast, McDonald's wants in. The Snack Wrap's return might heat up the 'chicken wars', fast-food chains fighting to be the best at chicken. On the same day, Popeyes announced their own 'generously sized Chicken Wraps' in biscuit-flavored tortillas, for a limited time only, as per 10, 2025, in U.S. slowed down kitchen service, so they removed it in 2016.
