Global food chain McDonald’s came under fire when the Israel chapter announced last year it had donated thousands of free meals to Israel Defence Forces troops committing war crimes in Gaza. Consumers across the globe boycotted the fast food giant. Coffee chain Starbucks has also been hit by similar boycotts.


Now the numbers are finally out, and it seems that the McDonald’s boycott has been quite successful. The company registered its first quarterly sales miss in nearly four years on Monday, squeezed by weak sales growth in its business division that includes the Middle East, China, and India, reports The Guardian.


Comparable sales in McDonald’s International Developmental Licensed Markets segment rose 0.7 per cent in the quarter, widely missing estimates of a 5.5 per cent growth, according to London Stock Exchange Group data. The business accounted for 10 per cent of McDonald’s total revenue in 2023.

RELATED STORIES


The CEO, Chris Kempczinski, last month showed concern about a “meaningful business impact“ in McDonald’s Middle East market and some areas outside the region due to the war as well as “associated misinformation” about the brand.


“The effects [of the war] on earnings durability would be our biggest concern … it looks like this is going to be an issue that persists past the next quarter or maybe even two,” said Brian Mulberry, client portfolio manager at Zacks Investment Management, which holds McDonald’s shares.


Similar boycotts have hit other brands including Zara and Starbucks, which missed market expectations and cut its yearly sales forecasts last week. It told investors that there was “significant impact on traffic and sales” in the Middle East due to the war on Gaza.


Starbucks previously said a sales recovery in China was slower than its expectations.


Meanwhile, consumer spending in China, McDonald’s second-largest market, has also remained weak despite government support measures.