McDonald's just had its worst quarter since Covid. It said customers are getting nervous
McDonald's sales dropped in the beginning of the year, marking the second consecutive quarter of declines as customers pull back their spending amid economic uncertainty.
In the United States, its largest market, same-store sales dropped 3.6% — the chain's worst drop since 2020 during the height of the Covid pandemic when people were told to stay home.
Net income for the first quarter was $1.87 billion, a decline from $1.93 billion compared to the same period a year ago. However, McDonald's notes that since last year had a Leap Day, or an extra day to make money, that slightly hurt its sales in 2025.
McDonald's CEO Chris Kempczinski said in a release that consumers are 'grappling with uncertainty,' but that he remains optimistic in the company's 'ability to navigate even the toughest of market conditions and gain market share.'
The chain's blunt assessment of economic environment mirrors that of other companies with Chipotle, Yum! Brands, Domino's Pizza and Starbucks all recently reporting meager earnings results as consumer sentiment sinks.
The first quarter heralded the release of its revamped value menu, which was supposed to rev up sales for budget-conscious customers. However, a new meal promotion with 'A Minecraft Movie' (released by CNN's sister company Warner Bros. Pictures) was perhaps more successful in driving visits, with a third-party tracking service measuring measurable spikes to its restaurants.
McDonald's will shift its focus next week to the release of new chicken strips, an item that its fans have been demanding to return since being pulled from menus a few years ago. The beloved chicken 'Snack Wrap' is also expected to make a return in the coming months, too.
Shares of McDonald's (MCD) fell nearly 2% in early trading.
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