McDonald’s sales took a hit from Covid-19 restrictions

McDonald’s US sales popped in the fourth quarter as guests spent more per order, but international sales took a hit from lockdowns related to Covid-19.

The company said Thursday that sales at US restaurants open at least a year rose 5.5% in the three months ending on December 31. It said its marketing investments, especially those featuring core menu items like chicken McNuggets, paid off.

But while US sales grew, McDonald’s international sales were dragged down by Covid-19 restrictions in Europe. European countries announced lockdown measures in the fall and over the holidays. Some have extended them in the new year as a concerning new variant of the coronavirus spreads. Restrictions include curfews that impact operating hours and limits on dine-in capacity, or dining room closures.

To combat the restrictions, “we are trying to do as much as we can to drive our drive-thru, delivery, our digital businesses,” CEO Chris Kempczinski said during an analyst call discussing earnings.

Overall, McDonald’s revenue fell about 2% in the quarter to $5.3 billion, missing Wall Street’s expectations.

Looking ahead, McDonald’s is focusing on its loyalty program, which will launch in the United States this year, chicken offerings, which include new crispy chicken sandwiches arriving in restaurants next month, and value options.

“What we’re seeing right now is that concern for economic uncertainty is, by far, the single … biggest concern that exists with our consumers,” Kempczinski said. “We think affordability is going to be one of the things that all of us need to stay focused on in a prudent way in 2021.”

The company has been offering deals in its app to encourage people to try classics like Big Macs or Egg McMuffins and new products like cinnamon rolls, he added