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McDonalds Profits Falter For The First Time Since 2003

Source: Gerard Stolk via flickr

They made it through the recession seemingly unscathed.  During the most-recent economic downtown, McDonalds enjoyed plenty of black ink while their rivals saw red.  Now it seems that the tables might be turning.

McDonald’s Corp. says a key revenue figure came in flat in July, its worst showing in more than nine years, as diners pulled back amid a rough economy. After years of outperforming rivals with a string of popular new items, the snag also suggests competition is intensifying for the world’s biggest hamburger chain.

During the recession, many customers saw McDonalds as a value:  a way to still enjoy a meal out while not having to pay an arm and a leg for it.  Now though, it appears that the hard times the country has been through are catching up with the Golden Arches.

“This chain has gone through a complete metamorphosis since the early part of the 2000s,” said Jack Russo, an analyst with Edward Jones. Now McDonald’s may struggle to continue delivering the same level of growth, he said.

“Instead of leading the pack as they have for so long, they’re running with the pack,” he said.

To help counter the attack on their bottom line, expect to see McDonalds get agressive with their marketing and their menu.

McDonald’s left hungry by rivals, economy in July – Businessweek.

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