👉 Background: McDonald’s was founded in 1940 in California and has become the world’s largest fast-food chain. It serves over 65 million customers Big Macs, french fries and nuggets daily, across more than 100 countries. In May this year, McDonald’s gave a nightmare earnings update where it warned of its worst results since the pandemic.

‍👉 What happened: But this quarter, it was all good news after Maccas reported its quarterly revenue hit $6.84 billion USD, which beat analyst expectations of $6.70 billion USD. On top of this, its net income rose to $2.25 billion USD, which was up from just over $2 billion USD last year. Even the Grimace Milkshake flop couldn’t slow them down.

‍👉 What else: The secret to its turnaround in profit comes from its push into chicken, which has really appealed to its value customers, because it means Maccas can charge “value” prices.

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‍What's the key learning?

‍💡At fast-food joints, menu choices aren’t just about taste, they’re about what fattens the bottom line. In a cost-of-living crunch, Maccas reckons that “value” has become a non-negotiable for customers... and you can’t offer value on beef products.

💡According to US government data, the average price of ground beef per pound is 2.81 times more expensive than a whole chicken. And in Australia, beef is roughly 4.5 times more expensive than chicken as an average retail price, according to Rabobank.

💡Maccy D’s has capitalised on that price differential…and the demand for chicken to sell more, at better margins. In fact, McDonald’s has grown its chicken business to double the size of beef in terms of market share. So the Chicken Big Mac and McCrispy range seem to exciting Maccas customers and investors.