McDonald's is slipping after taking a big hit from the new tax law
- McDonald's reported fourth-quarter earnings ahead of Tuesday's opening bell.
- The fast-food giant took an earnings hit from the Tax Cuts and Jobs Act,but outperformed on an adjusted basis.
- The company plans to spend billions in 2018 to update its stores.
- Watch the stock trade in real time here.
The Tax Cuts and Jobs Act hit McDonald's in the fourth quarter, and was the cause for earnings that came in below Wall Street's expectations on Tuesday. Shares of the fast-food chain are down 0.73% at $176.46 apiece in early trading Tuesday.
McDonald's reported earnings of $0.87 a share, missing the $1.60 that was expected by a wide margin. The miss was due to a one-time $0.84 per share cost associated with the new tax law. On an adjusted basis, McDonald's reported earnings of $1.71, topping estimates of $1.59.
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Revenue came in at $5.34 billion, which was higher than the $5.23 billion expected by analysts. Comparable sales were up 4.5%, in line with expectations.
"We served more customers more often, achieved our best comparable sales performance in six years, gained share in markets around the world and made tremendous progress with growth platforms such as delivery, mobile order and pay and Experience of the Future," CEO Steve Easterbrook said in a statement.
Chief financial officer Kevin Ozan said McDonald's would be investing $2.4 billion in 2018, focused primarily on remodeling existing locations to match its "Experience of the Future" plans that update stores with touchscreen kiosks and other modern updates.
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