McDonald's Faces Sales Slump Amid E.coli Outbreak and Discount Challenges

McDonald's reported a larger than anticipated drop in U.S. comparable sales due to an E.coli outbreak and consumer spending concerns. The company increased limited-time offers to boost spending, but pressure on franchise margins is a concern. International sales presented mixed results, with growth in some regions.

McDonald's has reported a significant drop in U.S. comparable sales for the fourth quarter, attributing the decline to a brief E.coli outbreak and cautious consumer spending patterns.

The outbreak, which began in October, led to the temporary suspension of Quarter Pounder sales in a fifth of its U.S. outlets and harmed sales.

While McDonald's implemented promotions to attract customers, analysts warn that the reliance on discounts might impact profitability. The company did, however, see a rise in international comparable sales, driven by markets such as Japan and the Middle East.

(With inputs from agencies.)