The McDonald's Corporation posted the same-store sales in October that reached the top of the estimates of analysts, illustrating the world's largest restaurant chain's turnaround plan is gaining traction.
The sales in stores that were open at least 13 months dropped 0.5 percent, the company Oak Brook, Illinois-based company said in a statement Monday. An estimated 2.2 percent decrease was anticipated by analysts, according to Consensus Metrix. On the other hand, same-store sales dropped only one percent in the United States, which was an improvement from September's decrease of 4.1 percent.
With over 14,200 locations in the U.S., McDonald's is coping with mounting competition from fast-casual chains such as Chipotle Mexican Grill Inc. and heavy discounting of products. In an attempt to rise from the sales slump it McDonald's is experiencing, it has been streamlining its options, even offering more customized choices for consumers. To be more effective, the fast food chain is also reorganizing its operations in the U.S.
"The U.S. is revamping its marketing approach, simplifying the menu and creating a new organizational structure," the company said in a statement Monday.
After the release of the results, McDonald's shares rose to $96.17 as much as 1.1 percent in early trading. In the previous week until the end of the previous week, the company had lost two percent, while the Standard & Poor's 500 Restaurants Index was minimally affected.
The domestic rivals in the U.S. have been cutting into the sales of McDonalds. Wendy's Co. announced in the previous week that sandwiches that were served on pretzel buns helped it have an increase in the same-store sales and Burger King is advertising more discounted goods. Earlier in the year, Taco Bell, owned by Yum! Brands Inc., began selling breakfast products in the country and introduced a new application for smartphones recently.
