McDonald's sales buoyed by Dollar Menu, breakfast
McDonald's global sales at stores open at least a year rose 2.6 percent in May, a welcome result after struggling a year ago. McDonald's sales were helped by cheap eats and new menu items, including egg white breakfast sandwiches.
New York — McDonald's says cheap eats and new menu items helped boost a key sales figure in May.
The world's biggest hamburger chain said Monday that global sales rose 2.6 percent at restaurants open at least a year, helped by an extra Friday in the month. In the U.S., the figure rose 2.4 percent, as the Dollar Menu and the introduction of its chicken wraps and egg white breakfast sandwiches lifted results.
The figure edged up 0.9 percent in the region encompassing Asia, the Middle East and Africa. The company, which as more than 34,000 restaurants around the world, noted that results in China were negative because of fears about avian flu.
McDonald's Corp. based in Illinois has been struggling to increase sales as it faces changing eating habits and weak growth in the broader restaurant industry. Late last year, the company reported a decline in the monthly sales figure for the first time in nearly a decade. Soon after, McDonald's ousted the head of its U.S. division and focused on value and refreshing its menu.
Specifically, the company is trying to attract customers in part by touting its Dollar Menu and other promotions, such as two Big Macs for the price of one. Some analysts say the strategy is bad for profit margins but the company says it's necessary to steal market share, given the weak growth in the broader restaurant industry.
Its aggressive focus on value has forced competitors to respond. Burger King and Wendy's, for example, have stepped up marketing for deals as well. Subway, which is privately held, also recently introduced a deal for a $4 lunch combo.
Even as they tout cheap eats, however, traditional fast-food chains including McDonald's are trying to change the image of their food to reflect shifting eating habits. McDonald's chicken wraps, which were introduced in late March, are intended to attract people in their 20s and 30s who want fresher foods. The wraps should cost around $4 a piece and help boost margins, following the introductory period during which chains typically offer steep discounts.
For May, McDonald's noted that it benefited from one less Tuesday and one more Friday. Fast-food chains generally rake in more sales on weekends. The positive impact ranged from 0.6 percent to 1.4 percent, depending on the region.
Shares of McDonald's were up almost 2 percent at $100.10.