McDonald’s reported better-than-expected sales and earnings during the fourth quarter, as its value promotions and new menu items drew in more customers.
Here’s what McDonald’s reported compared with what Wall Street was expecting, based on a Thomson Reuters survey of analysts:
- Adjusted earnings per share of $1.71, compared with a forecast profit of $1.59.
- Revenue was $5.34 billion, versus an estimate of $5.22 billion.
- Same-store sales in the U.S. climbed 4.5 percent, better than the expected 4.3 percent growth.
In the quarter ended Dec. 31, McDonald’s said net income fell 41 percent to $698.7 million, or 87 cents per share, from $1.19 billion, or $1.44 per share a year ago. Earnings in the latest period took a 84 cent per share hit from changes in the U.S. tax law.
Excluding items, the Golden Arches reported earnings of $1.71 per share, which was 12 cents higher than what analysts were expecting.
Shares of the company fell 1.4 percent after the opening bell Tuesday.
Global same-store sales grew 5.5 percent in the quarter, well-above Wall Street estimates of 4.9 percent, according to StreetAccount.
In the U.S. same-store sales rose 4.5 percent, higher than the expected 4.3 percent analysts had called for. Same-store sales in the U.S. were buoyed by McDonald’s national cold beverage value promotion, which offers soft drinks for $1 and McCafe beverages for $2, delivery and the introduction of Buttermilk Crispy Tenders, the company said.
“2017 was a strong year for McDonald’s as customers responded to the many ways we are making their experience more convenient and enjoyable,” CEO Steve Easterbrook said in a statement. “We served more customers more often, achieved our best comparable sales performance in six years, gained share in markets around the world and made tremendous progress with growth platforms such as delivery, mobile order and pay and Experience of the Future.”
In 2018, the company is doubling down on its renovation and modernization plans. McDonald’s said it plans to open 1,000 new restaurants in 2018 and invest $2.4 billion in existing locations.
Last year, the company planned to spend around $1.7 billion to win back the more than 500 million customer visits it said it lost to competitors since 2012. This included refranchising 4,000 restaurants and adopting a new restaurant design that featured sleek furniture, self-serve kiosks and adding table service at 650 locations.