McDonald’s brass working on ways to lure back customers

TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and why McDonald’s continues to struggle.

Transcript

00:00I'm Conway Gibbs reporting from the New York Stock Exchange.

00:02Here's what we're watching on the street today.

00:05There were small moves on Wall Street to begin the week as investors prepare for a deluge

00:09of information.

00:10Investors are looking ahead to a key reading on the labor market, a press conference from

00:14the Federal Reserve, and the busiest week of earnings season so far.

00:18Microsoft, Starbucks, Electronic Arts, JetBlue, and PayPal each report results on Tuesday.

00:25In other news, consumers are irate at McDonald's menu prices, and that is leading to a rethink

00:31at the world's largest fast food chain.

00:33The soul-searching follows dismal second-quarter results, a measure of global sales surprisingly

00:38dropped for the first time in over three years, and profits missed expectations.

00:44McDonald's is particularly struggling with lower-income customers.

00:48Quote, consumers still recognize us as the value leader versus our key competitors, but

00:53it's clear that our value leadership gap has recently shrunk.

00:56We are working to fix that with pace, CEO Chris Kuczynski told analysts on an earnings

01:01call.

01:02In an attempt to lure back diners, McDonald's is working on a plan to extend its $5 budget

01:07deal beyond August.

01:09Early consumer response to the promotion is promising, but McDonald's admits it expects

01:15the dissatisfaction with food inflation to linger for a lot longer.

01:19While overall inflation has moderated, the cost of eating out has not.

01:24Food-away-from-home jumped 4.1 percent in June from a year ago, according to the Consumer

01:29Price Index.

01:31That rise was triple the price gain for eating at home.

01:35That'll do it for your daily briefing from the New York Stock Exchange.

01:38I'm Conway Gittins with The Street.