The bounce back for McDonald’s as restrictions were lifted across the US was so strong in the first quarter that the company surpassed sales during the same period even in 2019, long before the pandemic broadsided the country.
McDonald’s revenue jumped 9 per cent to $US5.1 billion ($6.4b) for the January-March period, better than most had expected.
Last year at this time stores were closing globally and the world sheltered from spiking COVID-19 infections, so an improvement in sales during the same stretch this year was expected. How easily it topped 2019’s first-quarter sales of $US4.95bi, however, was not.
US same-store sales, or sales at locations open at least a year, rose 13.6 per cent in the January-March period. Fewer diners visited, and many dining rooms remain closed. But those who did visit ordered more.
McDonald’s said new products, including a crispy chicken sandwich and spicy nuggets, helped draw customers.
Any restaurant company with drive-thrus, such as McDonald’s, escaped the worst of the economic damage over the past year because they could continue to sell food even during the worst stretches of the pandemic. The Chicago company has drive-thru windows at nearly all US stores and two-thirds of stores in its biggest European markets. And at least 30,000 stores worldwide now offer delivery.
Worldwide, same-store sales rose 7.5 per cent, well above the 5 per cent gain analysts forecast. Strong sales in China and Japan helped offset softness in France and Germany, the company said.
Net income rose 39 per cent to $US1.5b. Adjusted for one-time items, the company earned $US1.92 per share, easily beating Wall Street’s forecast of $US1.81, according to analysts polled by FactSet.
McDonald’s shares were flat in premarket trading Thursday.
Other major fast food chains are seeing a similar rebound as most of the world emerges from the pandemic. Revenue at Yum Brands — which owns Pizza Hut, Taco Bell and KFC in the US — jumped 18 per cent in the first quarter. The company reported this week that same-store sales rose 9 per cent, with an especially strong performance in the US.
Like McDonald’s, sales at Yum restaurants outpaced sales two years ago before COVID-19 shook the world.
Starbucks also reported better-than-expected results for the quarter this week, with sales up 11 per cent.