McDonald’s US sales drop, as consumers cut back on spending

The golden arches have seen better days.

In Q4 2024, McDonald’s revenue came in at $6.39 billion, below the $6.44 billion that analysts LSEG surveyed predicted. The company reported $2.02 billion in net income, a YoY drop from $2.04 billion.

Same-store sales in the US dropped 1.4% in the quarter, with customers spending less per visit despite a slight climb in traffic. Wall Street expected a 0.6% drop.

Consumer spending is still tight, and the company stressed that low-income customers continued to feel a squeeze. “The industry is still seeing a fair bit of headwind,” CFO Ian Borden said.

But outside the US, things didn’t look so bad. International divisions reported increases in same-store sales.

And then there was E.coli.

In October, the Centers for Disease Control and Prevention linked an E.coli outbreak to onions on the chain’s Quarter Pounder burgers, leading to 34 hospitalizations and one death.

The fast food giant replaced suppliers, and the outbreak was over by December, according to the CDC. Still, the damage was swift: Traffic fell dramatically in affected areas and so did demand for the Quarter Pounder, a staple and popular item, per CNBC.

The company anticipates sales will recover by the beginning of Q2.

“I think right now what we’re seeing is that the E. coli impact is now just localized to the areas that had the biggest impact,” CEO Chris Kempczinski said on the company’s earnings call. “So think about that as sort of the Rocky Mountain region that was really the epicenter of the issue.”