McDonald's Corporation (NYSE: MCD) reported the first quarter financial result on Friday morning. All-day breakfast and a new value menu helped the company beat sales and profit expectations for the third straight quarter, signaling that a turnaround that began last year is sustainable.
"McDonald's brand and business is built on offering delicious food and beverages through unmatched convenience and compelling value," said McDonald's President and Chief Executive Officer Steve Easterbrook. "The turnaround plan we announced last year is grounded in enhancing these critical customer-driven elements, and I'm pleased to report that our turnaround is taking hold. The ongoing investments we're making in running great restaurants and delivering what matters most to our customers are beginning to yield sustained positive results. For the quarter, we generated higher sales, revenues and operating income in constant currencies across all business segments."
For the first quarter of 2016, McDonald's reported global sales increased 6.2% at established locations. The International Lead unit, which includes established markets such as Australia and U.K., rose 5.2%. The High Growth unit, which includes China, saw sales increase 3.6%. Profit up to $1.1 billion, and earnings per share of $1.23. That's $0.07 over analysts’ expectation. Revenue was $5.9 billion, also top beat Wall Street estimates.
“The continued momentum in the U.S. business was encouraging, and the company’s other markets all came in above expectations,” Citi Research analyst Gregory Badishkanian said in a note to investors. “Maintaining the momentum will be key…especially as the company laps the all-day breakfast introduction later this year.”