McDonald’s shares slide after sales fall short

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McDonald’s April sales fell short of expectations, as weak performances in the U.S. and Asia weighed on results. Same-restaurant sales in the U.S. rose by 3.3% while analysts were expecting a 5.0% increase and in Asia, a 1.1% increase in sales missed estimates, hurt by a drop in sales in Japan. Europe was a bright spot in April, as sales increased by 3.5% versus the consensus estimate of a 3.0% increase, overcoming debt concerns, austerity measures and high unemployment. Overall, global sales increased by 3.3% while analysts were looking for 4.0%.

One analyst said that the struggles in the U.S. may have stemmed from McDonald’s emphasizing more expensive menu items, such as 20-piece Chicken McNuggets (better known as a light snack at the Morning Coffee), while many are still keeping a cautious eye on their spending. The analyst went on to say that Wall Street may have set the bar too high given McDonald’s strong sales in recent months.

Commenting on his company’s results, CEO Jim Skinner said, “Our focus on delivering great tasting food and an exceptional restaurant experience generated positive global comparable sales results in April. Amidst a challenging global economic environment, McDonald's ongoing commitment to optimizing the menu, modernizing the restaurant experience and broadening accessibility will enable us to continue to satisfy the evolving needs of our customers.”

McDonald's (MCD : NYSE : US$93.60), Net Change: -1.91, % Change: -2.00%, Volume: 11,269,380

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