McDonald’s scores on drive-through outlets
US customers go for burgers and chips to avoid eating out during Covid-19 pandemic
Bengaluru — McDonald’s beat third-quarter revenue and profit estimates on Monday, as customers in the US ordered more hamburgers and fries in drive-through outlets and on delivery apps to avoid dining out during the Covid-19 pandemic.
The company’s limited-time promotional deal with rapper Travis Scott, which caused shortages of some ingredients, and other marketing investments also helped sales bounce back from pandemic lows, sending its shares more than 6% higher amid broader market gains.
However, the world’s largest burger chain said its business was being pressured in big markets outside the US including France, Germany and the UK by new lockdown restrictions due to a spike in virus cases.
Even before the new restrictions, the company’s overseas sales recovery had been sluggish compared to the US, where its huge number of drive-through lanes gave it an edge over rivals for customers looking for restaurant food without the risks of dining out.
Nearly 95% of McDonald’s 14,000 US restaurants have a drive-through.
McDonald’s total revenue fell about 2% to $5.42bn in the three months ended September 30, largely recovering from the more than 30% plunge posted in the second quarter.
Analysts on average had estimated revenue of $5.4bn, according to IBES data from Refinitiv.
US customer traffic still remained down from a year earlier, the company said.
Net income rose 10% to $1.76bn, helped by gains from the sale of a part of McDonald’s stake in its Japanese affiliate.
Excluding those gains, the company earned $2.22 per share, beating estimates of $1.90.
McDonald’s reiterated previously reported quarterly same-store sales figures of a 4.6% rise in the US and a 10.1% fall in international licensed markets.
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