16336: Spacing Out As Mickey D’s Sales Blast Off.

 

MediaPost reported Mickey D’s announced double-digit growth for Q2, as well as plans to launch a smaller restaurant format called “CosMc’s” in 2024. The news will probably prompt Byron Allen to double the demands in his McLawsuit.

 

Also, CosMc’s is named after an old McDonaldland character, CosMc, a space alien that craves McMenu items. CosMc is not related at all to Bill Cosby—although it would be kinda cool to introduce a Cosby Kids MC.

 

McDonald's Reports Double-Digit Growth, Teases Spinoff Brand

 

By Teresa Buyikian

 

McDonald’s Corporation exceeded analyst expectations in its revenue and same-store sales for the second quarter, according to the company’s earnings call.

 

Global same-store sales rose 11.7%, more than the 9.4% that was previously expected, with double-digit growth across each segment. Analysts attribute the growth to consumers’ desire for less expensive dining-out experiences and continued cost effectiveness overall, despite rising prices.

 

Additionally, digital systemwide sales in McDonald’s top six global markets surpassed $8 billion for the quarter, representing nearly 40% of the chain’s overall system-wide sales.

 

Revenue in the quarter totaled $6.5 billion, topping forecasts for $6.3 billion.

 

In the U.S. specifically, sales increased 10.3%, more than the 9.1% forecast by Wall Street, which the company attributes to strategic menu price increases and positive guest counts. Successful restaurant level execution, culturally relevant brand and marketing campaigns and continued digital and delivery growth contributed to strong comparable sales results.

 

There are three main dynamics working in McDonald’s favor, according to Neil Saunders, managing director of GlobalData. “The first is customers trading down from mid-market family restaurants to cheaper fast-food outlets like McDonald’s,” which “saves them money but still provides them with the treat of eating out.”

 

There are also “consumers who have increased their use of fast-food outlets, including McDonald’s, because they find it is an occasional, cost-effective way of feeding the family. This underlines the strong value for money message of McDonald’s is still resonating, even after menu prices have increased.”

 

In the third group are consumers “indulging themselves a little more because of the gloomier economic times. Among these people, McDonald’s is seen as an affordable indulgence that helps them feel a bit better.”

 

Bottom line, continued Saunder, “operating income is up by an impressive 81% and net income by 94%. Admittedly, some of this is flattered by weak numbers from last year when exceptional charges from the sale of the Russian business weighed on the results. However, buried within this are the positive consequences of good cost control and higher sales.”

 

Additionally, McDonald’s announced it plans to start testing a smaller restaurant format, “CosMc’s” in 2024, named after a little-known McDonald’s alien character. The company has described “CosMc’s as having “all the DNA of McDonald’s but with its own unique personality.” McDonald’s said it will share more details about CosMc and its locations at its investor day in December.