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McDonald’s Misses Q2 Earnings Forecast, Shares Fall

The company blames the rising dollar for cutting overseas profits


McDonald‘s (NYSE:MCD) reported that its second-quarter net income dipped to $1.35 billion, down from $1.41 billion during the same period last year. For the quarter, sales at the world’s largest burger chain increased narrowly to $6.92 billion, up from $6.91 billion in 2011.

EPS was $1.32, down from $1.35 last year. That fell short of the $1.37 a share Wall Street had expected, Reuters noted.

Has McDonald’s Hit a Roadblock It Can’t Overcome?
Has McDonald’s Hit a Roadblock It Can’t Overcome?

Investors didn’t like the results. McDonald’s shares tumbled almost 3% in pre-market trading on Monday.

McDonald’s noted that a rising dollar had trimmed its international results, reducing earnings by 7 cents a share during the second quarter. And it said sales at restaurants open more than one year rose 3.7%, which topped estimates.

Company officials predicted that sales growth at its restaurants would dampen this month as the global economy cooled.

The burger chain has recently been contemplating a major menu shift that would see its menu revolve less around beef and more toward chicken-based items.

McDonald’s results come on the heels of Friday’s revenue miss by Chipotle Mexican Grill (NYSE:CMG), which reported sales up 21% for its second quarter, but slightly below the level predicted by analysts. Panicked investors drove Chipotle shares down more than 22% in Friday trading.

Article printed from InvestorPlace Media,

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