McDonald’s Sales Lifted by Higher Prices, Sandwich Campaigns

McDonald’s Corp. MCD -0.33% said price increases and promotions helped boost its U.S. sales as the burger company continues to navigate the pandemic across its global business.

The Chicago-based company reported a 7.5% increase in U.S. same-store sales for its fourth quarter ended Dec. 31, with the chain attributing the growth to menu price increases and marketing of items such as fried chicken sandwiches and the McRib special.

Global same-store sales grew 12.3% compared with the previous year’s period as European markets including France, the U.K. and Germany experienced fewer pandemic-related disruptions. The company’s sales of $6 billion for the quarter were 12% greater than in the same period before the pandemic.

McDonald’s said that while Covid-19 disruptions have generally eased, the chain still dealt with some government restrictions on restaurant operating hours, limited dine-in seating and some dining-room closures during the quarter. The Omicron variant that has driven a surge in Covid-19 cases globally didn’t fully manifest during the company’s recently ended quarter.

McDonald’s reported per-share earnings of $2.23, after adjusting for one-time items, below analysts’ expectations of $2.34 a share. Net income climbed to $1.6 billion, up 19% from the amount in last year’s period.

The chain’s total sales were in line with expectations.

McDonald’s and other restaurant chains have been dealing with rising costs and a labor shortage, and the Omicron variant has exacerbated those problems. Some chains are limiting hours and switching to to-go service only in stores facing an increase in Covid-19 cases.

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McDonald’s Chief Executive Chris Kempczinski said in an interview last month that the company’s U.S. locations were open 10% fewer hours, on average, than before the pandemic because of short staffing.

McDonald’s said last year that it was raising menu prices to keep pace with rapidly growing costs, with wages up at least 10% at U.S. restaurants. McDonald’s executives estimated that U.S. prices would increase about 6% last year on an annual basis, because of increasing costs for labor, food, packaging and other materials.