McDonald's fourth-quarter sales jump thanks to all-day breakfast

Behold the Awesome Power of McDonald’s All-Day Breakfast

Behold the Awesome Power of McDonald’s All-Day Breakfast

Moneybox
A blog about business and economics.
Jan. 25 2016 10:36 AM

All-Day Breakfast Is Doing Wonders for McDonald’s Sales

McDonald's_Sign
The storm hath lifted.

Reuters

Well, McDonald's finally gave its customers the thing they'd been begging for, and the move is doing wonders for business. The chain announced Monday that its sales spiked during the fourth quarter of 2015, rising 5.7 percent at locations open more than a year (that's the all-important metric known as "comparable sales”). The cause? The company says it benefited “from the October launch of All Day Breakfast and, to a lesser extent, unseasonably mild weather.”

mcmuffin

Yes, all-day McMuffins seem to be saving McDonald's hide. For almost two years, pretty much nothing went right for the company. It suffered seven straight quarters of comparable sales declines in the U.S. from the end of 2013 to the middle of 2015, as it struggled with competition from upmarket chains like Chipotle and Five Guys. Its international business also stumbled thanks to a health scare in China. But under the leadership of a new CEO, McDonald's has been pushing hard on a plan to modernize its brand a bit, and in October, it finally stopped resisting demands to offer breakfast after 10:30 a.m. A survey by market researchers NDP found that the move was “luring in new and lapsed customers,” as the Wall Street Journal put it. For the past two quarters, comparable sales have been rising.

Advertisement

Now, might some of this also have to do with Chipotle's recent travails over food safety? Perhaps. But really, the lesson here is that you should always listen to the O'Jays.

Jordan Weissmann is Slate’s senior business and economics correspondent.