McDonald's Corp is finally getting customers back into restaurants, after years of decline
The world's largest restaurant chain reported another increase in US diners last quarter, the second successive time the measurement came up positive. Same-store sales, another closely watched benchmark, also beat estimates of analysts.
According to commentators, the results suggest that chief executive officer, Steve Easterbrook is making progress with his turnaround plan, which he launched after taking over reins at the company in March 2015 after a prolonged period of slumping sales. Shares are up 34 per cent this year, heading into the third-quarter report.
McDonald's domestic same-store sales are up 4.1 per cent in the third quarter, as against an average estimate of 3.4 per cent. Globally, the measure gained 6 per cent, which also beat estimates.
Earnings came in at $1.76 a share, in line with projections and revenue also matched predictions at $5.75 billion.
The results pushed the shares up as much as 1.9 per cent marking the biggest gain in almost a month.
According to commentators, the revival is driven by Easterbrook's revamped menu including cheaper drinks, premium burgers and all-day breakfast in the US. A push to franchise more of its restaurants globally also helped.
"We're building a better McDonald's and winning back customers with great tasting food, compelling value, and an enhanced experience," Easterbrook said in a call with investors yesterday.
Thirteen per cent of McDonald's US locations have been remodeled for the chain's "experience of tomorrow" layout. These include ordering kiosks and optional table service.
"We are continuing to make improvements inside our restaurants to make the customer experience more personal and less stressful," Easterbrook said.
Also thanks to a partnership with UberEATS, 5,000 of McDonald's US locations will offer delivery.