What’s With McDonald’s Poor July Sales?

by Alyssa Oursler | August 8, 2012 9:28 am

Last month, fast food giant McDonald’s (NYSE:MCD[1]) saw same-store sales stay flat[2] overall, as numbers dipped 0.1% in the U.S., 0.6% in Europe and 1.5% in the Asia Pacific, Middle East and Africa region.

Why the drop?

At home, the company pointed to two problems. The first was that its promotions failed to drive growth in the face of a sluggish economy. And the second? The mango pineapple smoothie. McDonald’s released the drink last July, so it faced a tough comparison year-over-year.

Weakness in Germany and several Southern European markets were to blame across the pond, while the drop in emerging markets was largely caused by weakness in Japan. The last region’s decrease was the most surprising, as it is usually a key area for growth.

Sales in Latin America — as you can see[3] by Arcos Dorados (NASDAQ:ARCO[4]) Q2 results — and Canada did come in positive, which allowed McDonald’s to stay even with last July.

Hopefully, some of the company’s new strategies — including more chicken products[5] like “mighty wings[6]” and new offerings like “breakfast after midnight[7]” — will be able to offset the issues that weighed down sales across the globe last month.

  1. MCD: http://studio-5.financialcontent.com/investplace/quote?Symbol=MCD
  2. same-store sales stay flat: http://www.boston.com/business/news/2012/08/08/mcdonald-blames-economy-for-sluggish-july/IFx8W0RXViaUhd2RDFQcjO/story.html
  3. as you can see: https://investorplace.com/2012/08/arcos-dorados-poised-for-a-comeback/
  4. ARCO: http://studio-5.financialcontent.com/investplace/quote?Symbol=ARCO
  5. more chicken products: https://investorplace.com/2012/07/why-mcdonalds-plans-to-play-chicken/
  6. mighty wings: https://investorplace.com/2012/07/mcdonalds-testing-chicken-wings-again/
  7. breakfast after midnight: https://investorplace.com/2012/08/mcdonalds-tests-breakfast-after-midnight/

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