McDonald’s same-stores sales down 22% in March amid coronavirus fears

McDonalds global same-store sales drastically declined by 22% in March. Yahoo Finance’s Heidi Chung joins the On The Move panel to discuss.

Video Transcript

ADAM SHAPIRO: Let's keep talking about food because Heidi Chung has been watching what's going on with McDonald's. And Heidi, what is the latest? I mean, not to be-- it was expected a drop in sales, but really dramatic, right?

HEIDI CHUNG: Very dramatic, Adam. So it's not such good news from McDonald's this morning, the company officially withdrawing its 2020 guidance, as well as the long-term guidance that it provided at the end of February.

We had CEO Chris Kempczinski this morning saying in an internal memo, quote, "The world is going through a historic event with profound consequences for McDonald's, for the restaurant industry, and for humanity at large."

McDonald's revealing today in an SEC filing that after seeing total same store sales increase by 7.2% in January and February, same store sales-- excuse me-- sank 22.2% in March and 3.4% in the first quarter.

Now looking at McDonald's' international businesses, same store sales fell 34.7% at its international operated market segment, which includes France, Italy, and the UK. Its international developmental licensed markets and corporate restaurants, which includes China, Japan, and Brazil, saw same store sales tumble 19.4% during the month.

It's important to note, though, that China has, though, resumed operations in about 98% of its restaurants as of today. The company also announcing that it will be slashing its Capex by $1 billion this year, as it continues to deal with the challenges that it has faced due to the coronavirus outbreak.

Kempczinski also announcing that he will be taking a 50% cut to his base salary through at least September 30th. And four other executives at McDonald's will also be taking 25% cuts to their base salaries. It's important to note that the shares, though, are up today. And the shares are actually only down about 10% this year, and that's compared to the broader market's decline of 16% in the same time period, Adam.

ADAM SHAPIRO: And Heidi, as you say, shares are up about 2% for McDonald's.