McDonald's Profit Rises; Falls Short of Wall Street's Hopes
McDonald's on Friday reported first-quarter profit that rose but fell short of market expectations, undermined by weaker international sales and U.S. consumers that appeared to dine out less.
The burger giant reported first-quarter earnings excluding items of $1.26 per share, up from $1.23 a share in the year-earlier period.
Revenue increased to $6.6 billion from $6.55 billion a year ago. U.S. comparable sales fell by 1.2 percent, while falling by 1.1 percent in Europe. In both regions, McDonald's cited economic uncertainty.
Analysts had expected the company to report earnings excluding items of $1.27 a share on $6.59 billion in revenue, according to a consensus estimate from Thomson Reuters.
"While the company's results for the quarter reflected difficult prior year comparisons and the ongoing impact of global economic headwinds, we continue our efforts to build market share and deliver sustained profitable growth for all stakeholders," said McDonald's President and CEO Don Thompson, in a statement.
Since late last year, the world's leading fast-food chain has struggled amid widespread economic sluggishness and relentless competitors encroaching on its traditional turf. The battle to lure in health-conscious diners has forced McDonalds and its competition to experiment with new menu items and ramp up their ad presence.
In 2012, the company saw monthly sales fall for the first time in ten years. In March, McDonald's unveiled a Fish McBites menu item that failed to boost U.S. sales as the company had hoped.
The company saw an even steeper sales drop in its Asia, Middle East and Africa operations, which slid 3.3 percent. McDonald's cited the fallout from a still weak Japan and a Chinese economy that has also faltered in recent months.
In pre-market trading, the company's stock fell by more than one percent to $100.30.