McDonald’s sales rebounded in the second quarter, with the chain delivering global comparable sales growth of nearly 4%. That’s really good news after the chain struggled in multiple quarters.
The comeback included a lot of positive numbers for McDonald’s:
- The chain drove positive comparable guest counts globally, despite a challenging backdrop for the industry.
- Internationally Operated Market segment comparable store sales increased by 4%, with all markets driving positive comp sales growth.
- International Developmental Licensed Markets delivered comp sales growth of more than 5.5%, led by Japan and with positive comps across all areas.
- United States comp sales were up 2.5% in the quarter.
CEO Christopher Kempczinski made it clear that while it’s working on much bigger changes as part of its Accelerating the Arches program, it’s also focusing on pricing.
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“The $5 Meal Deal continues to resonate with consumers as we recently celebrated the 1-year anniversary of the program. We’ve also continued to see incrementality from our McValue platform which also includes our Buy One, Add One for $1 deal, which launched at the beginning of this year,” he shared during the chain’s second-quarter earnings call.
“And of course, we’re excited to welcome Snack Wraps back onto the menu after a 9-year hiatus. We launched Snack Wraps with an attractive $2.99 nationally advertised price point and early results are encouraging,” he added.
Pricing, however, is only a small piece of the company’s evolution plan.
McDonald’s has a grand plan to keep its business moving forward.
Image source: McDonald’s
McDonald’s has a grand plan
Fast-food chains apparently need to have somewhat cleverly-named turnaround plans. Burger King has “Reclaim the Flame,” and McDonald’s has “Accelerate the Arches.”
Kempczinski broke down the key parts of the plan during the call.
“Central to our Accelerating the Arches strategy is aligning our greatest assets, our iconic brand and unmatched size and scale with the power of data and technology. It’s happening in three distinct ways,” he shared.
- Reimagining how we improve the restaurant experience
- Transforming how we engage our most loyal brand fans
- Modernizing the employee experience
“Our progress to digitize the Arches is unleashing the full potential of our size and scale, all while strengthening our foundation, such as increasing the reliability of our systems,” he added.
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Kempczinski did not comment on fixing the perpetually broken McFlurry machines.
He did, however, share major plans for McDonald’s to improve its in-store experience driven by technology.
McDonald’s adds a high-powered partner
Kempczinski and McDonald’s have been working on parts of “Accelerate the Arches” for nearly two years. The CEO believes the impact will be meaningful.
“As I said during our investor update in late 2023, when we first introduced the restaurant, consumer and company platforms, we believe they can create a step change in our sales and margin trajectory over time. Slowly at first, with increasing speed and impact as we scale like no other brand can,” he said.
To make the level of change needed, McDonald’s has partnered with a key technology leader.
“We’re excited to see this start coming to life. In our restaurant platform in partnership with Google, we’re developing edge computing, which extends the cloud to our restaurants,” he added.
Kempczinski explained exactly what things might look like.
“Edge is the digital foundation for the next generation of restaurant innovation that powers AI and Internet of Things enabled restaurants. The expected benefits are many. Increased restaurant uptime and enhanced customer and crew experience, improved food quality and cost savings opportunities. We’re currently live with Edge in hundreds of U.S. restaurants and are beginning to deploy it internationally,” he added.