A worker cleans the floor in a McDonald’s restaurant in the Chicago Loop on March 19, 2020 in Chicago, Illinois.
Scott Olson | Getty Images
McDonald’s said Thursday its U.S. same-store sales in the third quarter rose nearly 5% as customers ate more Big Macs and McNuggets for dinner.
Fast-food companies like McDonald’s have been recovering from the coronavirus pandemic faster than the broader restaurant industry, thanks to their convenient drive-thrus and cheap prices. Shares of McDonald’s, which has a market value of $177 billion, have risen more than 16% this year.
The stock rose 1% in premarket trading on the announcement.
The chain’s U.S. comeback has been helped by its promotions and marketing. In September, it offered a deal on rapper Travis Scott’s favorite meal, causing the chain to restrict certain ingredients due to its popularity. Scott’s $6 meal included a quarter pounder with cheese and his favorite toppings, an order of french fries with barbeque sauce and a Sprite. With the help of that deal, September had the highest monthly same-store sales in nearly a decade, with growth across all meal times.
This month, it’s following up the promotion with a similar deal featuring reggaeton singer J. Balvin’s order, which includes a Big Mac sandwich, medium french fries with ketchup and an Oreo McFlurry.
In the U.S., its same-store sales growth was boosted by more orders being made as part of a group, which drives up the value of each check. It’s also attracting more dinner customers, but overall traffic remains negative.
Outside of its home market, McDonald’s is bouncing back slower after seeing steeper sales declines in the prior quarter. Harsher lockdown restrictions meant many of its restaurants had to close their doors entirely, and its international locations are less likely to have drive-thru lanes.
Its international operated markets segment, which includes France and the United Kingdom, saw same-store sales fall 4.4%. Australia reported positive same-store sales growth, but Germany and Spain were among the markets that saw declines.
In the international developmental licensed markets segment, which includes China and Brazil, same-store sales shrank by 10.1%. Latin America and China dragged down same-store sales results for the division.
Worldwide, same-store sales for the quarter shrank by 2.2%, much better than the second quarter’s 23.9% plunge.
McDonald’s also said it is increasing its quarterly cash dividend by 3% to $1.29 per share.
“While current year business results have been impacted by the Covid-19 pandemic, the pace of recovery paired with the Company’s strong financial position support this increase to the dividend while still giving the Company the ability to invest in the business,” McDonald’s said in a statement.
McDonald’s will present its full third-quarter results and hold a virtual investor event on Nov. 9.