Why did McDonald's net profit fluctuate in recent quarters?

McDonald's net profit has experienced fluctuations due to a combination of factors affecting its sales and consumer spending patterns:

1. **E. Coli Outbreak Impact**: The E. coli outbreak in October 2024 had a significant negative effect on McDonald's net profit. The outbreak led to a temporary halt in sales of its Quarter Pounder burgers in a fifth of its 14,000 U.S. outlets, resulting in a 1.4% decline in U.S. same-store sales for the quarter. This disruption in sales and the subsequent measures taken to address the outbreak contributed to the net profit fluctuations.
2. **Consumer Spending Patterns**: Weaker consumer spending in key markets such as the U.S., Europe, and China has been a trend affecting McDonald's net profit. Sluggish spending in these regions, influenced by high food inflation and other economic factors, has led to a decline in sales and, consequently, net profits. McDonald's has responded with strategies like limited-time offers and meal deals to spur spending, but these may not always translate into immediate net profit improvements.
3. **Global Sales Trends**: McDonald's has faced challenges in international markets, with sales dropping by 1.5% between July and September 2024, marking the biggest decline in four years. This global sales decline, coupled with softer performance in the U.S., has impacted net profit figures. While the U.S. market saw a slight rise in sales, this was not enough to offset declines in other regions.
4. **Strategic Initiatives**: McDonald's has been implementing strategies to boost efficiency and sales, such as digital ordering, loyalty programs, and partnerships for delivery services. While these initiatives are positive in the long term, their impact on net profits may not be immediately apparent due to the costs associated with implementing these new systems and marketing efforts.

In summary, McDonald's net profit fluctuations are primarily due to the E. coli outbreak, changes in consumer spending habits, global sales trends, and strategic initiatives. These factors combined create a complex environment where McDonald's must navigate multiple challenges to maintain and grow its net profit.