The earnings report comes as investors watch for signs of recession after last year’s record inflation. McDonald’s could benefit if more low-income customers leave the higher-priced restaurants, as it did in the third quarter.
What to expect the company, CEO Chris Kempinski said in the earnings release “Short-term inflationary pressures will continue into 2023.”
The company reported earnings of $2.59 per share, an increase of 19%. Like other fast food chains, Chicago-based McDonald’s raised prices for hamburgers and french fries last year to counter rising labor and commodity costs.
However, traffic increased 5% in all of 2022, as McDonald’s meals continued to be cheaper than many competitors, attracting lower-income consumers.
In October, CFO Ian Borden said the company was “now gaining share among lower-income consumers” in the US due to the “affordability” of McDonald’s
It did not specify “low income,” but data provider NPD Group defines annual household income of $75,000 or less as “low income.”
“Creator. Devoted pop culture specialist. Certified web fanatic. Unapologetic coffee lover.”