New York (Trends Wide Business) — Higher prices and chicken sandwiches are helping to boost McDonald’s sales. But the earnings disappointed Wall Street on Thursday morning.
Last year, sales at US stores open at least 13 months rose 13.8%, the biggest annual increase since McDonald’s began reporting comparable sales in 1993, the company said Thursday.
In the fourth quarter, U.S. sales were up 7.5%, thanks in part to menu price increases, strong digital sales, and menu items like the Crispy Chicken Sandwich and limited-time McRib, which became available for purchase on November 1. Last year, McDonald’s made NFTs of McRib to commemorate the product’s 40th anniversary.
Items like the crispy chicken sandwich helped boost sales at McDonald’s last year.
McDonald’s, along with other restaurants, has been raising prices as inflation rises.
In October, CEO Chris Kempczinski said the company expected menu prices to be about 6% higher in 2021 compared to 2020. He said at the time that the price increase “has been pretty well received by customers.” . Eating out got 6% more expensive last year, according to the Bureau of Labor Statistics.
The price helped McDonald’s with wage inflation as well as increases in food and paper costs, Chief Financial Officer Kevin Ozan said during a call with an analyst Thursday. The company expects those food and paper costs to rise in 2022.
Still, the company’s report of $6 billion in revenue fell short of analyst expectations for the quarter. Earnings per share also failed to meet Wall Street expectations. Before the close of trading, McDonald’s shares fell 2%.
McDonald’s said its results “benefited from fewer restaurant closures and reduced Covid-related government restrictions compared to the prior year.”
But internationally, sales continued to suffer due to the pandemic.
In China, sales at stores open at least 13 months fell in the third quarter due to a resurgence of the virus, the company said. In Australia, sales were flat during the quarter due to government restrictions related to covid-19. Sales grew in international markets with fewer pandemic-related restaurant closures, such as France, the UK, Italy and Germany.
