McDonald's says its profit and sales declined as the world's biggest hamburger chain saw customer traffic fall around the world.
The company said sales fell 3.3 percent globally and in the U.S. during the third quarter. In the region encompassing Asia, where a major McDonald's supplier was shown on TV repackaging expired beef, the figure fell 9.9 percent.
Continue Reading Below
"By all measures our performance fell short of our expectations," CEO Don Thompson said.
In the U.S., McDonald's Corp. is fighting to hold onto customers amid intensifying competition and shifting tastes toward food people consider more wholesome. In hopes of improving its image, McDonald's last week launched a social media campaign inviting customers to ask questions about its food. It began with frank questions like, "Why doesn't your food rot?" and "Is the McRib made from real pork?", showing just how bad some of the perceptions about McDonald's food can be.
Affordability is another issue, with CEO Don Thompson noting that the people who tend to go to McDonald's are struggling more financially than customers who might go to other chains.
In August, the company said it was bringing back longtime McDonald's executive Mike Andres as president of the U.S. division, marking the second change in less than two years.
Over in China, an undercover TV report this summer showed one of its major suppliers repackaging expired meat. The plant stopped operations and many of McDonald's restaurants in the country were left unable to sell burgers, chicken nuggets and other items. The chain's reputation took a hit as well.
For the quarter, revenue declined to $6.99 billion, short of the $7.23 billion Wall Street expected. Net income declined to $1.07 billion, or $1.09 per share. Adjusted for one-time costs, earnings were $1.52 per share. Analysts expected $1.37 per share.