McDonald’s CEO: ‘The US Economy Is Divided’ As Wealthy Customers Keep Coming While Regular Families Cut Back – Amazon.com (NASDAQ:AMZN), McDonald’s (NYSE:MCD)

McDonald’s Corp. MCD is kicking off 2025 with a warning about a growing divide among U.S. consumers, noting a clear split along income lines.

What Happened: During its first quarter earnings call on Thursday, McDonald’s CEO, Chris Kempczinski’s opening remarks centered around the declining foot traffic in the quick-service restaurant industry, especially from the low and middle income consumer cohort, both of which are down nearly 10% compared to the prior year quarter.

However, traffic among high-income consumers remains strong, which Kempczinski said “illustrates the divided U.S. economy, where low- and middle-income consumers in particular are being weighed down,” by factors such as inflation and a bleak economic outlook.

During the Q&A session, CFO Ian Borden noted that McDonald’s customer base skews toward low- and middle-income consumers, prompting the company to double down on its commitment to “strong value” and “affordability” across its menu offerings.

Borden adds that this value-focused strategy helped McDonald’s outperform its closest competitors on same-store guest counts during the first quarter.

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Why It Matters: The company experienced a 3.6% year-over-year decline in same-store sales during the quarter, which marks its steepest decline since 2020, during the COVID-19 pandemic. As a result, McDonald’s missed consensus estimates, with $2.67 in earnings per share, from $5.96 billion in revenue.

This coincides with the Consumer Sentiment Index crashing to a three-year low in April, at 50.4, down from 57 in March, with tariffs, inflation expectations, and market reactions taking their toll.

Amazon.com Inc. AMZN CEO Andy Jassy expressed similar concerns during the company’s first-quarter earnings call on Thursday, pointing to shifts in consumer behavior reminiscent of the pandemic. “There’s maybe never been a more important time in recent memory than now to try to keep prices low,” he said.

Price Action: The stock was down 1.88% on Thursday, and is currently down 0.20% after hours following the company’s earnings release.