McDonald's hits nine-month low
McDonald's shares fell the most in nine months after it posted second-quarter profits and revenue that trailed analysts' estimates and indicated that economic weakness would hurt results for the remainder of the year.
The shares slid 2.7pc in afternoon trading in New York after falling 3.2pc in the morning. The Illinois-based company's shares had gained 14pc this year while the Standard & Poor's 500 Restaurants Index rose 17pc.
Chief executive Donald Thompson has been trying to attract consumers with less expensive fare, such as Dollar Menu foods in the US and combo meals in Europe. Sales at global stores open at least 13 months rose 1pc in the quarter, matching the average estimate of analysts.
Revenue rose 2.4pc to $7.08bn (€5.03bn) in the quarter, trailing analysts' estimate of $7.09bn.
McDonald's has faced a US consumer environment where unemployment has been stuck above 7.5pc for 54 straight months. Competitors also are introducing new items – Burger King has smoothies and soft-serve ice cream, while Taco Bell is testing a $1 menu.
In Europe, McDonald's is facing a cash-strapped consumer.
McDonald's has about 34,500 stores globally, of which 19pc are owned by the company. (Bloomberg)