McDonald's U.S. Sales Rise for First Time in Two Years
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McDonald's Corp reported its first rise in quarterly global same-restaurant sales in more than a year and said the trend would continue into the current quarter, suggesting that CEO Steve Easterbrook's turnaround efforts were bearing fruit.
Shares of the world's biggest restaurant chain by sales rose 7.4 percent in premarket trading on Thursday.
Under Easterbrook, who took over the top job in March, the burger chain has simplified its menu, improved service by raising wages and is working on serving healthier food.
These actions seem to have gone down well with customers.
Global comparable sales rose 4 percent in the third quarter, their first rise in more than one year, driven by demand for value meals and breakfast items in China, where sales had plummeted after a food safety scandal in July 2014.
Analysts had expected a much modest rise of 1.9 percent, according to research firm Consensus Metrix.
Demand for new menu items such as the Premium Buttermilk Crispy Chicken Deluxe sandwich and breakfast items such as the Egg McMuffin pushed U.S. comparable sales into positive territory for the first time in two years.
Net income rose to $1.31 billion, or $1.40 per share, in the third quarter ended Sept. 30 from $1.07 billion, or $1.09 per share, a year earlier.
Revenue fell 5.3 percent to $6.62 billion.
Excluding items the company earned $1.40 per share.
Analysts on average had expected a profit of $1.27 per share and revenue of $6.41 billion, according to Thomson Reuters I/B/E/S.
McDonald's shares were trading at $110.15 on Thursday.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Kirti Pandey and Anil D'Silva)