McDonald's Shares Rise 4% Despite Missing Q2 Earnings and Revenue Expectations

McDonald's (NYSE:MCD) reported a decline in both second-quarter earnings and revenue, missing analyst expectations. Despite this, the stock gained more than 4% intra-day today.

For the quarter, McDonald's posted an EPS of $2.80, falling short of the Street estimate of $3.07. Revenue also missed the mark, coming in at $6.49 billion compared to the anticipated $6.62 billion.

Global comparable sales saw a 1.0% decline, with all segments showing negative results. Sales in the U.S. dropped by 0.7%, International Operated Markets decreased by 1.1%, and International Developmental Licensed Markets fell by 1.3%.

Despite the overall decline, consolidated revenues experienced a slight 1% increase in constant currencies compared to the same period last year.

CEO Chris Kempczinski attributed the mixed results to the company's "Accelerating the Arches" strategy, which focuses on value and growth drivers like chicken and loyalty programs. However, earnings were affected by several charges, including $97 million in pre-tax non-cash impairment charges and $57 million in pre-tax restructuring charges tied to modernization efforts.

In the U.S., the decrease in comparable guest counts was somewhat offset by growth in average check size due to strategic menu price increases. The International Operated Markets segment faced challenges, particularly in France, while the International Developmental Licensed Markets were impacted by the ongoing conflict in the Middle East and declining sales in China, despite positive performance in Latin America and Japan.

McDonald's did not provide specific guidance for the upcoming quarters but emphasized its commitment to delivering everyday value and accelerating strategic growth initiatives.