Will McDonald's Bigger Burgers Help Sales?

Companies and Brands

Published: February 5, 2024 6:45 am

McDonald’s Corp. (NYSE: MCD) has started to sell bigger, better burgers. Investors can watch as the fast-food giant finds out if its experiment will work. The first announcement of the “best burgers ever” was made in April last year. Customers would get softer buns, more Big Mac sauce, carefully melted cheese, and new white onions. After almost 10 months, the products are available at thousands of locations.

Some of the changes are simple. There will be six patties on a grill at once, not eight as the practice used to be. Employees will not have to squeeze them so that eight will fit. When the kick-off was first announced, Chef Chad Schafer, Senior Director of Culinary Innovation at McDonald’s USA, said, “We found that small changes, like tweaking our process to get hotter, meltier cheese and adjusting our grill settings for a better sear, added up to a big difference in making our burgers more flavorful than ever.” (These 16 countries have unique McDonald’s menus.)

Will Anyone Care?

McDonald’s management will find out if anyone cares in the next few weeks. It is the largest fast-food company in America by far. Zippia put its revenue at $23 billion for 2022 (McDonald’s will announce 2023 revenue soon). Pizza Hut follows McDonald’s at $12 billion and Subway at $9 billion. Neither is a direct competitor, based on the menu. Burger King and Wendy’s are, and each has about $2 billion in revenue.

The last time McDonald’s reported financials was for the quarter that ended September 30. U.S. same-store sales surged 8.1% year over year. Globally, they rose 8.8%. Revenue grew 14% to $6.7 billion, while net income increased 17% to $2.3 billion.

The new burger upgrade numbers will not appear in the fourth-quarter figures. However, management will get to disclose early results of the change for the quarter that started at the beginning of this year.

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