McDonald's Corp. profit climbed almost 6 percent in the third quarter, as U.S. customers gobbled up its newest, more expensive Angus burgers, the company said Thursday. But the company rattled investors when it said its strong domestic performance could finally falter in October because of the recession.
The world's largest burger chain, which has been among the notable winners of the recession because of its cheap menu and value meals, cautioned that the fast-food business was slowing around the globe but that McDonald's would continue to see growth.
In a statement, CEO Jim Skinner cited a "declining informal eating out market around the world" in October and said McDonald's sales in U.S. restaurants open at least a year — an important measure of a restaurant's performance — would be "flat to slightly negative" in October.
"This is due in part to the current economy environment and strong results from a a year ago," he told investors during a conference call. "But we do not believe this is a change in the trend of performance in the U.S."
Last year, the figure climbed 5.3 percent.
During the third quarter, McDonald's said sales in U.S. restaurants open at least a year rose 2.5 percent. The U.S. performance was helped by Americans' healthy appetite for the third-pound premium burgers that debuted nationwide this July as well as its cheap menu options and its espresso coffee drinks.
Around the globe, the measure rose 3.8 percent.
For the three months that ended Sept. 30, McDonald's earned $1.26 billion, or $1.15 per share. That compares with a year-ago profit of $1.19 billion, or $1.05 per share.
But revenue slid 3.5 percent to $6.05 billion, dragged down by fluctuating global currencies.
Excluding the impact of those currency fluctuations, McDonald's said its third quarter revenue grew 2 percent.
Profit was better than Wall Street forecasts, even though the fast food company's revenue fell just short of expectations. Analysts surveyed by Thomson Reuters expected the Oak Brook, Ill.-based restaurant chain to earn $1.11 per share on revenue of nearly $6.1 billion.
Also Thursday, Skinner said McDonald's shelving openings for about 100 stores this year — almost of them in China.
"The marketplace there continues to be stagnant," he said.
McDonald's shares climbed $1.17, or 2 percent, to $59.50 in midday trading Thursday. It had been trading as high as $60.60 before Skinner's comments on U.S. expectations.
