McDonald's officials claim that the E. coli outbreak has been resolved.
- McDonald's CEO Chris Kempczinski informed investors that the E. coli outbreak associated with Quarter Pounder burgers is now considered resolved.
- CFO Ian Borden stated that the outbreak is not anticipated to significantly affect the company's operations.
- McDonald's is reintroducing Quarter Pounder burgers without slivered onions in approximately 900 restaurants following the outbreak.
The deadly E. coli outbreak that was linked to Quarter Pounder burgers by health authorities a week ago has been resolved, according to CEO Chris Kempczinski, who informed investors of the situation's resolution.
Kempczinski stated on the company's call on Tuesday that we have handled the issue and now view it as being behind us.
In his prepared statement, he stated that the "situation seems to be under control."
On Sunday, McDonald's announced that Quarter Pounder burgers would be reintroduced in approximately 900 restaurants where they had previously been removed due to the outbreak.
The Food and Drug Administration is still investigating the slivered onions used in Quarter Pounders as the likely source of contamination, even though health authorities didn't detect any E. coli in the burger's fresh beef patties. McDonald's has stopped sourcing onions from the supplier indefinitely and will return the Quarter Pounder to menus sans slivered onions.
McDonald's experienced a decline in daily sales and traffic to its U.S. restaurants after the outbreak announcement, according to CFO Ian Borden. Despite this, the company does not anticipate a significant impact on the business.
McDonald's is now concentrating on reassuring customers and achieving higher sales, as it did earlier in October, through its $5 value meal and the launch of the Chicken Big Mac.
Borden stated that they believe the most significant events have passed, and the current focus is on restoring consumer confidence and revitalizing the U.S. business to regain the strong momentum previously discussed.
McDonald's reported a 0.3% increase in U.S. third-quarter same-store sales, reversing a decline in the second quarter but falling short of the 0.5% growth predicted by StreetAccount estimates.
Despite beating Wall Street's estimates for quarterly earnings and revenue, McDonald's experienced a 1.5% decline in overall same-store sales, primarily due to weaker demand in key international markets.
On Tuesday, McDonald's shares dropped by 2.5% in premarket trading but regained their footing during the conference call. The stock remained unchanged when the markets opened.
Earlier on the call, Kempczinski apologized to customers for the situation.
"Kempczinski stated that the recent E. coli cases are deeply concerning and hearing about their impact on customers has been distressing. On behalf of the entire system, he expressed sincere apologies and committed to making things right."
Since Friday, there have been 75 health cases linked to the outbreak in 13 states, with one death among an older adult.
Victims of the outbreak have filed at least three lawsuits against McDonald's.
Business News
You might also like
- The auto industry is shifting away from its "capital junkie" habits following unprecedented investments in EVs and self-driving technology.
- Richard Branson encourages young people not to despair about the future, stating that we can conquer climate change.
- "Gladiator" earns $55.5 million while "Wicked" takes in $114 million in its domestic opening.
- Can Starbucks reduce wait times at its airport cafes?
- Paris's next big soccer success may be planned by one of the world's wealthiest families.