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McDonald’s Beat Analysts’ Same-Store Sales Growth Estimates

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May. 2 2019, Published 10:06 a.m. ET

McDonald’s SSSG

McDonald’s (MCD) posted an SSSG (same-store sales growth) of 5.4%, which beat analysts’ estimate of 3.4%. The company’s SSSG was driven by growth in the guest count and average ticket size.

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US segment

The US segment posted an SSSG of 4.5%. Although the segment’s comparable guest count fell during the quarter, the segment’s SSSG was driven by growth in the average ticket size. The company’s management credited the deployment of its EOTF (Experience of the Future) and its promotional offerings, like the two for $5 mix and match deal, for the strong SSSG. In the first quarter, McDonald’s implemented EOTF in 400 new restaurants. By the end of the quarter, McDonald’s deployed EOTF in 8,000 restaurants in the United States.

International operated markets

The international operated markets segment posted an SSSG of 6.0% with a strong performance from Australia, France, Canada, Germany, and the United Kingdom. The company’s SSSG in France was the highest since 2011.

In the United Kingdom, McDonald’s SSSG was driven by value offerings, menu innovation, and McDelivery, which drove its average check and guest count. In Australia, the company posted a positive SSSG for the 20th consecutive quarter. The growth in the delivery business and investments in technological advancements contributed to the company’s SSSG in Australia.

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International developmental licensed markets and corporate

The international developmental licensed markets and corporate segment posted an SSSG of 6.0%. In China, the company introduced a new everyday value offering late in the quarter following the launch of its extra value meal in late 2018.

Peer comparison

During the same quarter, Starbucks (SBUX) posted an SSSG of 3.0% across the system.

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