Fast food chain McDonald’s has implemented “strategic menu price increases” in order to raise revenues, which succeeded, as the company reported a 14 percent revenue increase in the last quarter.
In Q3 2023, McDonald’s brought in a total of $6.69 billion, surpassing the expectation of $6.58 billion, according to Refinitiv data firm.
McDonald’s did not disclose the full extent of its price increases, which vary geographically. It has over 13,000 restaurants in the U.S. and more than 38,000 internationally. A branch in Darien, Connecticut was reported to have charged $18 for a Big Mac medium combo meal. A Big Mac comb meal is $13.69 at a McDonald’s in Midtown Manhattan.
Despite the price hikes, McDonald’s reported it is still beating its rivals across the market in terms of customers’ perception of affordability. “It’s clear that our customers continue to seek reasonably priced meals as rising costs persist, and our markets around the world continue to respond,” CFO Ian Borden told analysts.
McDonald’s sales and profits beat expectations in the third quarter thanks to higher prices and movie-inspired ads touting the ubiquity of its burgers https://t.co/vNi4iQbUI8
— Bloomberg (@business) October 30, 2023
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McDonald’s earned an adjusted $3.19 per share versus an expected $3, and had a Q3 net income of $2.32 billion, up from $1.98 billion a year earlier.
The McDonald’s CEO Chris Kempczinski explicitly said “difficult times” create an “opportunity” for the company. “It’s clear that consumers continue to be more discriminating about what and where they spend,” he said, adding, “in difficult economic times [for consumers], the McDonald’s brand and our positioning on value is an opportunity for us.”
In the earnings call yesterday, McDonald’s also revealed that its rebranded Crispy Chicken Sandwiches, now called the “McCrispy,” has become a $1 billion global brand. “Our McCrispy chicken sandwich continues to be an important driver of chicken share growth, having first launched in markets like Canada and Germany and now a billion-dollar brand,” CFO Ian Borden said.
“McDonald’s Crispy Chicken Sandwich quickly became a fan-favorite when it first hit US menus in 2021. And now, this beloved sandwich is joining some of our most iconic menu items — McNuggets®, McMuffin® sandwiches and McFlurry® desserts — with a fresh new name: McCrispy™,” the company announced earlier this year.
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