McDonald's reported lower-than-expected second-quarter profit on Monday, due to a weakening global economy and the impact of a stronger dollar.
The world's largest fast-food chain's second-quarter earnings fell 4.5 percent, according to The Wall Street Journal. Lately, higher food, labor occupancy and planned costs, such as McDonald's Olympics sponsorship, are what are hurting its profitability.
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During the second quarter, McDonald's earned $1.35 billion, or $1.32 per share, which is down from last year's $1.4 billion, or $1.35 per share, noted the Associated Press. The company expects exchange rates to hurt third-quarter results by 8 to 10 cents per share.
The United States' slow economic recovery, the company's debts and Europe's belt-tightening are also making diners rethink eating out, hurting consumer confidence, reported Reuters.
"We're seeing more markets that are having consumer confidence issues ... It's a little more than a European cold, if you would," McDonald's Chief Executive Officer Don Thompson said on a conference call with analysts, noted Reuters.
Thompson, who took over earlier this month, has been struggling to lure Americans back to McDonald's with a new extra-value menu, according to Bloomberg. Stores open at least 13 months in the US had sales that rose 3.6 percent, the slowest growth in five quarters.