MacDonald’s warns Chipotle to be weak in the first quarter

Like a lion, like a lamb.

This is how restaurant executives imagine 2025 after a rough start to the year, mainly caused by freezing temperatures, wildfires and consumer attention.

Many restaurant chains like Restaurant brand’ Burger King and Popeyes said sales improved in the fourth quarter as Value Offering revived diners who instead cooked at home. flat McDonald’s Domestic traffic rose despite a 1.4% decline in the same US store sales.

However, the trend reversed in January.

“We have begun a year facing industry-wide traffic headwinds, exacerbated by significant weather phenomena around the country.” Wendy’s CFO Kenneth Cook said during a company conference call Thursday.

According to restaurant market research firm Revenue Management Solutions, net fast food sales rose 3.4% in January compared to the same period last year, but growth fell slightly from the 4.9% spike in December. Breakfast and lunch traffic both declined that month.

“I think consumers are still on alert,” U.S. President of the subway, Doug Frye, told CNBC. “I think they’re waiting to see how the economy goes, but they’re not going to sacrifice its quality, portion size, and the amount of what they’re eating.”

For an easy comparison with last year’s decline, we expect traffic and sales growth to recover as the year progresses. Industry traffic was negative except in November every month, with sales slipping through the summer. This is usually a high point for restaurants.

“We expect year-over-year comparisons will be easier in the summer,” said restaurant brand CFO Sami Siddiqui.

January always brings cold temperatures, but this year included wildfires in Los Angeles and new uncertainty after Donald Trump took office.

Chipotle Mexican Grill The wildfire estimates that traffic increases at the same store in January were 400 basis points (4%) damaged.

Overall, traffic to restaurants in Chipotle fell by at least 2% compared to a year ago. Chipotle CFO Adam Rymer told analysts that the company expects its store sales to remain roughly flat in the first quarter.

Turning to the second quarter, Chipotle expects sales in the same store to be weak as they face comparisons with last year’s popular promotions. The company is forecasting stronger sales later this year, but stocks fell 4% due to weaker forecasts for the coming months.

For now, restaurants do not anticipate a major impact on businesses from the Trump administration’s trade war. Chipotle, which imports about half of the avocado supply from Mexico, has downplayed concerns about how the 25% tariff will now raise food costs. The company, along with Wendy’s and McDonald’s, did not include a new 10% job in China and its outlook for its outlook from potential taxes in Mexico and Canada.

However, consumers are worried about tariffs and potential pressure on wallets.

US consumer sentiment hit a seven-month low in February as it fears prices will rise next year. According to the Ministry of Labor, inflation rates have already risen 3.4% over the past 12 months, as January’s inflation rate was higher than expected.

For chains plotting comebacks, sales are expected to improve later this year.

McDonald’s, for example, is still waiting for sales to recover fully after the quarterly E. coli outbreak linked to Pounder Burger began measuring sales weight in mid-October. The fast food giant predicts demand will recover by the beginning of the second quarter, McDonald’s CEO Chris Kempchinski said during a company conference call Monday.

Furthermore, if overall consumer health is strengthened, McDonald’s forecasts even more sales growth.

“If the underlying environment improves beyond initial expectations, particularly for low-income consumers, we expect to benefit disproportionately compared to our competitors,” said Ianboden, CFO at McDonalds. .

Then there Starbucksto turn your business around, you’ll need a much longer timeline. Sales at the same coffee chain’s stores have declined during the four quarter as consumers have chosen to buy caffeinated drinks elsewhere.

Starbucks suspended its fiscal year 2025 outlook and did not provide insight into expected sales for the year. However, Starbucks CFO Rachel Ruggeri told investors that the company’s revenues are expected to improve later in the fiscal year.

“(Earn per share) is expected to be at the lowest (second quarter) due to seasonality. She said in late January. “The EPS will then be in fiscal year 2025. It is expected to improve in the second half of the