Shares of McDonald’s Corporation (NYSE: MCD) rose in the pre-market trading after the fast-food giant posted better-than-expected profit and sales figures for the third quarter. The feat is attributed to new menu additions and steady consumer demand for its affordable burgers and fries, particularly as consumers grappled with high food prices.
McDonald’s stock surged by 2.44% to $262, with the company also announcing a 10% increase in its quarterly cash dividend.
The burger chain’s commitment to keeping its offerings budget-friendly in the wake of industry-wide price hikes last year has proven to be a masterstroke, countering the trend of inflation-hit consumers opting to eat more at home and a decline in footfall.
Global comparable sales at McDonald’s skyrocketed by 8.8% for the quarter ended September 30, beating the average analyst estimate of 7.36%, according to LSEG data.
Building on its history of successful menu innovations, McDonald’s introduced the Cheesy Jalapeno Bacon quarter pounder in July and delighted customers by bringing back the fan-favorite Spicy Chicken McNuggets to menus in September. Both items, as noted by UBS analysts, played a pivotal role in driving robust sales growth in the third quarter.
Despite a decline in overall foot traffic for the quarter, McDonald’s saw a 7.3% increase in July, as reported by Placer.ai data. Foot traffic growth moderated in the following two months, with declines of 1.1% and 3.7%, but it remained ahead of broader industry trends.
Comparable sales in the United States climbed by 8.1% in the quarter, outperforming estimates of a 7.4% increase, attributed to higher average spending at its stores. McDonald’s internationally operated markets also reported an 8.3% increase in same-store sales, surpassing expectations for 8.03% growth.
McDonald’s Corporation (NYSE: MCD) reported a 14% increase in total quarterly revenue, which reached $6.69 billion, beating estimates of $6.58 billion. Net income increased to $2.32 billion, or $3.17 per share, from $1.98 billion, or $2.68 per share, compared to the previous year. On an adjusted basis, McDonald’s posted a per-share profit of $3.19, decisively surpassing estimates of $3.00.