McDonald’s reported Q1 results that fell short of expectations due to the adverse effects of inflation and continuing boycotts in the Middle East. The company announced a first-quarter diluted earnings per share of $2.66, representing a 9% increase from the year-ago quarter, but still failing to meet forecasts compiled by Visible Alpha.
Revenues climbed 4.6% to $6.17 billion, just settling above projections. There was a noticeable slowdown in comparable store sales growth, which only surged 1.9%, in comparison to the robust 12.6% growth recorded a year earlier. The International Developmental Licensed Markets unit witnessed a slight dip of 0.2% in comparable store sales as result of the ongoing Middle East conflict.
CEO, Chris Kempczinski, indicated that inflation has had a significant impact on McDonald’s performance, as consumers become increasingly careful with their spending.
Despite the release of these figures, there hasn't been a significant change in McDonald’s share price, with a minimal drop of 0.1% to $273.25 as of noon E.T. Tuesday. The company's shares reached a record high in January but has experienced nearly an 8% drop to date this year.