McDonald's Sales Surprise Again — to the Upside!

McDonald's im loving it logo
McDonald's im loving it logo

After a surprise drop in global sales last month, McDonald's Corp. (NYSE: MCD) surprised analysts again this morning by posting a larger-than-expected rise of 2.4% in global same-store sales. November sales rose in all three of the company's geographic regions, with the United States up the most at 2.5%, followed by Europe 1.4% higher and Asia/Pacific, Middle East and Africa up 0.6%.

The company's CEO said:

We are strengthening our focus on the global priorities that are most impactful to our customers - optimizing our menu, modernizing the customer experience and broadening accessibility to our Brand to move our business forward amid today's broad-based economic and competitive challenges.

Notice he did not mention "value pricing" or "value menus," a mainstay of the company's strategy into October, when same-store sales fell by 1.8%. That does not mean that McDonald's did not benefit from its lower-priced offerings.

In the U.S. the company said that results were better due to a "balance" of popular breakfast items and value offerings helped by "premium menu options." In Europe, results rose due to "enhanced value platforms" and promotional pricing for premium menu items. In the third geographic region, "expanded value programs" led to better results, according to the company.

Still, the company clearly downplayed its U.S. value offerings, and that is the region that performed best. Now we will see whether McDonald's can - or wants to - translate that strategy to other parts of the world.

Shares are about 2.1% in the premarket this morning, at $90.30 in a 52-week range of $83.31 to $102.22. The stock posted the annual low after last month's dismal sales report.

Paul Ausick

Filed under: 24/7 Wall St. Wire, Food, Retail Tagged: featured, MCD