McDonald's earnings beat profit estimates despite growing inflation

McDonald's shares increased by 2.7% during premarket trading following the release of the earnings report

Despite record inflation, McDonald's Corp surged past prior sales and profit estimates, according to an earnings report released on Thursday. 

Recently, the fast-food chain has raised the prices for its burgers and fries to match rising labor and commodities costs; however, demand was steady as McDonald's remains cheaper than competitor dine-in restaurants. 

In the United States, McDonald's comparable sales rose by 6.1%, marking the ninth consecutive quarter of growth. Meanwhile, international comparable sales increased by 10% as prices for the chain's iconic Big Mac rose. 

The burger company's digital systemwide sales were reported to be nearly $7 billion in McDonald's top six markets. During premarket trading, McDonald's shares increased by 2.7% at 263.58 per share. 

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McDonald's sign on clear day

McDonald's third quarterly earnings report beat prior estimates despite an overall decreased in total revenue.  (AP Photo/Gene J. Puskar, File / AP Newsroom)

"Our third quarter 2022 performance demonstrated broad-based business momentum as global comparable sales increased nearly 10%. I remain confident in our Accelerating the Arches strategy as our teams around the world continue to execute at a high level," said Chris Kempczinski, McDonald’s president and CEO. 

"As the macroeconomic landscape continues to evolve and uncertainties persist, we are operating from a position of competitive strength. I also want to thank our franchisees, who have done a tremendous job navigating this environment, while providing great value to our customers," Kempczinski added.

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However, overall net income dropped by 8% to $1.98 billion, or approximately, $2.68 per share. Total revenue surpassed prior estimates of $5.69 billion with $5.87 billion but declined by 8% during the quarter. 

McDonald's is considered one of the largest fast-food retailers in the world, with well over 200,000 employees and 40,000 locations worldwide. 

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