Fast food giant McDonald’s (NYSE:MCD) is apparently preparing to announce corporate layoffs as part of a company reorganization process, The Wall Street Journal reported Sunday. What do you need to know about McDonald’s layoffs?
Well, in an internal email sent last week, the company requested its corporate U.S. employees to work from home through Wednesday of this week so it can virtually reveal staffing decisions.
“During the week of April 3, we will communicate key decisions related to roles and staffing levels across the organization,” the company told employees, according to WSJ. McDonald’s has also asked employees to terminate all in-person meetings with outside parties, including vendors, at its headquarters.
As it stands, McDonalds employs more than 150,00 corporate workers, with roughly 70% operating outside the U.S. The company is expected to begin announcing its staffing cuts Monday.
McDonald’s Layoffs Shakes Wall Street Amid Growing Recession Fears
Now, this isn’t a complete surprise. In January, McDonald’s announced that it would evaluate corporate staffing levels, as part of a new business plan, hinting at the potential for layoffs or expansions in some areas.
The new “Accelerating the Arches” business strategy revealed in January emphasized “Doubling Down on the 4Ds.” That is Delivery, Digital, Drive Thru and Development. Per the plan:
“The Golden Arches represent our ambition as a business; we always strive for new heights and excellence, both in our performance and how we represent the Brand. We want to continue to build on the momentum that has been a feature of our recent growth. So, our next chapter is focused on Accelerating the Arches.”
While the current layoff reports may be within McDonald’s growth strategy, Wall Street may not see it that way. Some stock indices are down today, potentially reading the McDonald’s layoffs announcement as a precursor to future job cuts, akin to what has already been seen in the tech world. That said, MCD stock is surprisingly up on the news, just under 1%.
McDonald’s had a relatively strong 2022. The company reported rising sales and margins, both domestically and abroad. Whether the narrative shifts this week remains to be seen.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
