Key facts
- McDonald's spending by low-income diners fell 2.4% year-over-year in the latest quarter.
- Numerator defines low-income guests as those from households earning $40,000 or less annually.
- This decline represents McDonald's first quarterly drop with this customer segment in a year.
- Burger King experienced a 0.3% increase in spending from low-income diners during the same period.
- McDonald's comparable US sales growth slowed to 0.8% in the second quarter.
McDonald's is facing increased competition for low-income customers, with spending by this demographic at the fast-food giant declining 2.4% year-over-year in the latest quarter, according to consumer analytics firm Numerator. This marks the first quarterly decrease in spending from this key customer group in the past year, representing an estimated $310 million in lost sales.
In contrast, rival Burger King saw a modest 0.3% gain in spending from low-income diners during the same period. The data highlights McDonald's challenges in attracting diners, particularly amid economic disparities. CEO Chris Kempczinski acknowledged inconsistent execution with the company's latest value menu, which aims for items priced at $3 or less, despite efforts to restore value leadership.
McDonald's reported a slowdown in comparable US sales growth to 0.8% in its second quarter. Competitors, including Burger King and casual dining chain Chili's, have reported stronger results, often attributed to their own value-focused offerings. Some consumers have indicated a shift towards eating at other chains or preparing more meals at home due to rising costs.
Despite these struggles, certain McDonald's offerings continue to attract customers across income levels. The recently reintroduced fried apple pie has been purchased by 11.7% of US households.