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McDonald's Sales Dip Despite Aggressive Discounting

April 19, 2013

McDonald's reported disappointing sales for the first quarter, citing difficult prior year comparisons, intense competition and frugal consumers.

The chain's global comparable sales decreased 1.0%, while U.S. same-store sales dropped 1.2%. Its Asia-Pacific, Middle East and Africa segment reported a drop of 3.3%, primarily due to negative sales results in China, and sales in Europe were down 1.1%. Income for the quarter was relatively flat at $1.27 billion.

"While not unexpected, we're not satisfied with our first quarter results," said CEO Don Thompson during an earnings call Friday, calling out as obstacles softer retail sales in the U.S. and the Avian flu concerns in China. "The challenging economic environment [in] which we are operating impacted our first-quarter results. While there are mixed signs of a slow recovery in the U.S., significant headwinds persist as consumer confidence continues to waver."

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