McDonald's apologises for E. coli as sales slide

The boss of McDonald's has apologised to customers hit by an E. coli outbreak in the US linked to the chain's Quarter Pounders, a new setback for the chain which has been struggling with flagging sales.

"We are sorry for what our customers experienced," its chief executive Chris Kempczinski said. "We offer our sincere and deepest sympathies and we are committed to making this right."

Executives told investors they believed that the public health scare was contained and did not think it would have a material impact on sales.

But they acknowledged it had added to the pressure the company has been under, as budget-conscious customers eat out less.

On Tuesday, two customers in the US filed a proposed class-action lawsuit against the firm over the incident. Other consumers have also taken legal action.

"While we anticipated a challenging environment in 2024, our performance so far this year has fallen short of expectations," Mr Kempczinski said while discussing the firm's latest update for investors.

In the three months to September, sales at stores open at least a year fell 1.5% compared with the same time last year, McDonald's said on Tuesday.

Its international markets were hit particularly hard, especially the UK, France, China and the Middle East.

It marked the second consecutive quarter of falling sales and the biggest in four years, after a decline of 1% in the three months prior.

Mr Kempczinski said the firm was focused on offering "value and affordability" as customers continue "to be mindful about their spending".

He said McDonald's had, however, been pleased by signs of improvement in the US, where the company launched a $5 (£3.85) happy meal promotion over the summer and has enticed customers with a new chicken sandwich.

In the quarter, that helped the firm eke out a 0.3% sales rise in the US in stores open at least a year.

McDonald's is now hoping to replicate that success in other markets such as the UK, where the chain has introduced offerings such as a Three for £3 deal and a £2.75 breakfast bundle.

The debut of the popular "Grimace" shake in the UK has also driven excitement, executives said.

"We are beginning to see progress," said chief financial officer Ian Borden, while adding that the firm expected that its business in the Middle East would continue to be affected by conflict in the region.

Bosses told investors they did not expect to increase prices significantly until the business was doing better, noting that they are still facing "a lot of resistance" from customers.

The impact of the E. coli outbreak in the US, in which authorities have recorded at least 75 patients, was not reflected in the results reported on Tuesday, which showed overall quarterly revenue at the company rising 3% to more than $6.8bn (£5.2bn), compared with a year ago.

Profits fell 3% to $2.25bn.

Mr Borden said the public health scare had reversed signs of improving sales and traffic in the US, but said the company believed it would be able to restore confidence among its customers.

"The most significant events are behind us," he said. "Getting our business back to that really strong momentum - we're really confident in our ability to do that."

McDonald's said on Monday it was starting to resume sales of Quarter Pounders, which had been suspended last week in about a fifth of its US restaurants.

It has stopped working indefinitely with Taylor Farms, which had been its supplier of onions believed to be the source of contamination.