McDonald's exterior

McDonald’s to unveil turnaround effort as sales dip

Chain's sales continue to fall as competitors Taco Bell and Chipotle report gains

McDonald’s plans to unwrap a plan next month that it says will help turn around ongoing sales declines around the world.

The world’s biggest hamburger chain said Wednesday global sales declined 2.3% at established locations during the first three months of the year. That included a 2.6% drop in the U.S., where it is facing changing tastes and tougher competition.

Already this year, McDonald’s has announced a number of changes in the U.S. including a simplified grilled chicken recipe, curbing the use of antibiotics in chicken, and a pay bump and vacation time for workers at company-owned stores amid ongoing protests over its treatment of workers.

CEO Steve Easterbrook, who stepped into the role just last month, has said in a statement the company is “keenly focused on acting more quickly to better address today’s consumer needs, expectations and the competitive marketplace.” But that push is happening at a time when McDonald’s is facing intensifying pressures.

A day earlier, Chipotle Mexican Grill said its sales rose 10.4% at established locations during the quarter, as a pork shortage and bad weather damped results. The chain has been enjoying strong sales growth, with executives saying the company is changing the way people think about fast food.

Taco Bell’s parent company, Yum Brands, said the chain’s sales rose 6% during the period. The increase was helped by the introduction of Taco Bell’s breakfast menu, which has repeatedly targeted McDonald’s in its advertising.

Meanwhile, McDonald’s said it plans to share the initial details of its turnaround plan on May 4. For April, the company said it expects sales would decline at stores operating at least 13 months.

The company is struggling in other regions of the world as well. During the first quarter, the unit encompassing Asia, the Middle East and Africa reported an 8.3% drop because of weakness in China and ongoing consumer perception issues in Japan.

Sales at established locations dipped 0.6% in Europe because of softness in France and Russia.

For the period ended March 31, McDonald’s earned $811.5 million. That compares with $1.2 billion a year earlier.

Revenue for the Oak Brook, Illinois-based company declined to $5.96 billion from $6.7 billion. Analysts expected $6.02 billion in revenue.

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