OAK BROOK Ill.
McDonald’s far outstripped market expectations by posting domestic same-store sales gains of 4.3 percent for May, with chain officials crediting the boost to everyday bargains, menu variety and convenience.
Franchisor McDonald’s Corp. also cited strong demand for breakfast items and the two southern-style fried-chicken sandwiches that were introduced during the month.
In spite of the positive results, some analysts said they expect unusually high commodity costs and rising labor expenses to squeeze profit margins.
Last week analysts had forecast that McDonald’s year-over-year same-store sales gain would fall close to the 2-percent domestic increase that was logged for April. Some reports suggested that the Southern Style Chicken sandwich giveaway and high Dollar Menu sales had hurt margins.
The May 2008 results compare with a same-store sales gain of 7.4 percent for the same month of 2007.
Worldwide, McDonald’s same-store sales rose 7.7 percent, boosted by a 9.6-percent leap in Europe and a 9.7-percent jump in the chain’s Asia/Pacific, Middle East and Africa region.
McDonald’s stock rose $2.23, or 3.9 percent, to $59.18 in early Monday trading