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McDonald’s (NYSE:MCD), the world’s largest hamburger chain, said a key sales metric slid a steeper-than-expected 2.2 percent in its core U.S. business in May, though world-wide sales edged in above expectations. Shares fluctuated.
The report will be among McDonald’s last, as the company plans to stop disclosing its monthly sales figures beginning July 1.
Global sales at McDonald’s restaurants open at least 13 months fell 0.3 percent in May, the Oak Brook, Illinois-based company said in a statement today. That compared with expectations for a 0.9 percent decline, according to Consensus Metrix.
McDonald’s is struggling with changing consumer tastes and increased competition at home as well as food-safety issues in Asia and economic slowdowns in parts of Europe.
The 2.2 percent decline in the U.S. market was worse than expectations for a 1.7 percent drop. Traffic to its domestic restaurants fell again as rivals, ranging from sandwich chain Chick-fil-A to burrito seller Chipotle Mexican Grill, continued to pick off customers.
McDonald’s USA is running a variety of tests aimed at luring back customers. Those tests include extended breakfast hours, custom burgers and new food such as breakfast bowls made with kale and spinach. Frustrated franchisees are clamoring for the company to trim and simplify its massive menu, which they blame for service slow-downs that turn off diners.
In the Asia-Pacific, Middle East and Africa region, McDonald’s same-store sales fell 3.2 percent in May, hurt by continued weakness in Japan and negative performance in China. Analysts had expected a 3.8 percent decline, according to Consensus Metrix.
In Europe, McDonald’s same-store sales were up 2.3 percent, topping analysts’ expectations for a 0.6 percent increase. The division was helped by strong results in the U.K. and improved performance in Germany and France.
“McDonald’s has embarked on a turnaround plan to reignite our business performance,” said chief executive officer Steve Easterbrook said in the statement. “Our talented franchisees, suppliers and employees are placing renewed emphasis on the basics of great-tasting, high-quality food, compelling value and outstanding service.
Shares were down 0.1 percent at $95.47 at 2:11 p.m. in New York. The stock is down 6.4 percent this year.
Story by ProactiveInvestors