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McDonald's Posts Rare Sales Miss as Middle East Boycott Weakens Overseas Business

A sign for the US fast food restaurant chain McDonald's is seen outside one of their restaurants in Sint-Pieters-Leeuw, near Brussels, Belgium September 5, 2023. (Reuters)
A sign for the US fast food restaurant chain McDonald's is seen outside one of their restaurants in Sint-Pieters-Leeuw, near Brussels, Belgium September 5, 2023. (Reuters)
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McDonald's Posts Rare Sales Miss as Middle East Boycott Weakens Overseas Business

A sign for the US fast food restaurant chain McDonald's is seen outside one of their restaurants in Sint-Pieters-Leeuw, near Brussels, Belgium September 5, 2023. (Reuters)
A sign for the US fast food restaurant chain McDonald's is seen outside one of their restaurants in Sint-Pieters-Leeuw, near Brussels, Belgium September 5, 2023. (Reuters)

McDonald's reported its first quarterly sales miss in nearly four years on Monday on weak sales growth at its international business division, partly due to the conflict in the Middle East, sending the company's shares down about 4%.

The burger giant is among several Western brands that have seen protests and boycott campaigns against them over their perceived pro-Israeli stance in the Israel-Hamas conflict.

McDonald's said the war had "meaningfully impacted" performance in some overseas markets in the fourth quarter.

With the most pronounced hit in the Middle East, the company also saw an impact to business in countries such as Malaysia and Indonesia, as well as in France, CEO Chris Kempczinski said on a post-earnings call.

"So long as this war is going on ... we're not expecting to see any significant improvement (in these markets)."

Comparable sales in McDonald's International Developmental Licensed Markets segment rose 0.7% in the fourth quarter, widely missing estimates of 5.5% growth, according to LSEG data. The business accounted for 10% of McDonald's total revenue in 2023.

"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.

Starbucks last week also cut its annual sales forecast, partly due to a hit to sales and traffic at stores in the Middle East.

Consumer spending in China, McDonald's second-largest market, has also remained weak despite government support measures.

While McDonald's does not provide a breakup of sales in individual international markets, it noted industry-wide promotions picked up in China during the quarter as restaurants rush to revive flagging demand.

McDonald's US business also showed signs of weakness, particularly with low-income consumers reducing order sizes or trading down to cheaper items.

That resulted in US comparable sales rising 4.3% in the quarter, just shy of estimates of a 4.4% rise.

Still, McDonald's reported an adjusted per-share profit of $2.95, beating estimates of $2.82.

"It's going to take some time for the results to bounce back (in the Middle East)," Stephens analyst Joshua Long said, but added he was still positive on McDonald's stock as it is "one of the best positioned brands" to navigate a tricky macroenvironment.

McDonald's forecast 2024 operating margin to be in the mid-to-high 40% range and expects more than 1,600 net restaurant additions this year. It reported an operating margin of 45.7% for 2023.

Global same-store sales rose 3.4% in the quarter, missing estimates of a 4.9% rise, in what was its slowest sales growth in about three years.

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Turkish Manufacturing Nears Stabilization as PMI Rises in December

An employee works at an assembly line in the Toyota manufacturing plant in Sakarya October 10, 2013. REUTERS/Osman Orsal
An employee works at an assembly line in the Toyota manufacturing plant in Sakarya October 10, 2013. REUTERS/Osman Orsal
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Turkish Manufacturing Nears Stabilization as PMI Rises in December

An employee works at an assembly line in the Toyota manufacturing plant in Sakarya October 10, 2013. REUTERS/Osman Orsal
An employee works at an assembly line in the Toyota manufacturing plant in Sakarya October 10, 2013. REUTERS/Osman Orsal

Turkish manufacturing activity shrank at a slower pace in December, marking two consecutive months of improvement, signaling a slight moderation in operating conditions at the end of 2025, a business survey showed on Friday.

The Istanbul Chamber of Industry Turkiye Manufacturing Purchasing Managers' Index (PMI), compiled by S&P Global, rose to a 12-month high of 48.9 from 48.0 in November thanks ‌to softer slowdowns ‌in output, new ‌orders, ⁠employment and purchasing activity.

Readings ‌below 50.0 indicate contractions in overall activity, while figures above that suggest growth, Reuters said.

"With PMI reaching its highest level for a year in December, the manufacturing sector takes some momentum into 2026, giving hope that we will ⁠see growth in the months ahead," said Andrew Harker, ‌Economics Director at S&P ‍Global Market Intelligence.

New ‍orders eased at the slowest pace ‍since March 2024, with some firms noting improvements in customer demand. However, both total new business and new export orders continued to moderate.

Production was scaled back, though at a slower rate than in November. Employment saw ⁠a marginal reduction, while purchasing activity also experienced a softer decline, according to the survey.

Input costs rose sharply, driven by higher raw material prices, leading manufacturers to increase selling prices, the survey said.

"While inflationary pressures rebounded following the recent lows seen in November, rates of increase in input costs and output prices were still comfortably below the highs ‌we have seen at times in recent years," Harker said.

Business

Asia Stocks Make Bright Start to 2026

Stock markets welcomed the New Year with healthy gains. Punit PARANJPE / AFP
Stock markets welcomed the New Year with healthy gains. Punit PARANJPE / AFP
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Asia Stocks Make Bright Start to 2026

Stock markets welcomed the New Year with healthy gains. Punit PARANJPE / AFP
Stock markets welcomed the New Year with healthy gains. Punit PARANJPE / AFP

Asian markets made a bright start to 2026 on Friday but volumes were thin with Tokyo and Shanghai still closed as investors awaited fresh direction from Wall Street.

Stocks had a bumper 2025, with the S&P adding 16.4 percent, the tech-rich Nasdaq 20.4 percent and London's FTSE enjoying its merriest Christmas in 16 years, said AFP.

In Asia, Seoul stocks whooshed 75 percent, while Hong Kong's Hang Seng index bounced 28 percent and Tokyo's Nikkei 225 rocketed more than 26 percent.

"Naturally, the start of the new year comes with the question everyone asks moving from one year to the next: will this continue? The consensus is that, yes, it will," said Kyle Rodda at Australian brokerage Capital.com.

"When it comes to the all important US economy, Wall Street is pricing in growth will accelerate this year while inflation still moderates and interest rates get cut. Meanwhile, analysts predict that corporate fundamentals will improve," Rodda said.

Hong Kong was up 2.2 percent Friday with chip designer Biren Technologies roaring 80 percent higher after its initial public offering.

The Shanghai-based firm's listing raised more than $700 million, suggesting that investor appetite for anything related to artificial intelligence remains insatiable.

Biren "enjoys scarcity value and high market attention", said Kenny Ng, a strategist at China Everbright Securities.

"The industry is in a flourishing stage, with many firms striving for breakthroughs and significant growth potential," Ng said.

Search-engine giant Baidu jumped almost seven percent after saying its AI chip unit Kunlunxin had filed a listing application in Hong Kong.

Taipei, Sydney, Jakarta, Manila and Singapore also advanced while while Seoul's Kospi, which soared 76 percent in 2025 in large part due to AI boom, was up 1.7 percent.

Samsung Electronics added three percent after co-CEO Jun Young Hyun said customers had praised its high-bandwidth memory (HBM) chips, some saying that "Samsung is back", Bloomberg News reported. 

After volatile recent days, following record highs for silver, precious metals started the new year on a bright note with gold up 0.64 percent per ounce and silver 1.5 percent shinier. 

Business

Bulgaria Adopts the Euro, Nearly 20 Years After Joining the EU

A map of Bulgaria with the EU symbol is projected on the Bulgarian National Bank as people celebrate New Year's Eve and Bulgaria's adoption of the euro in Sofia, Bulgaria, Thursday Jan. 1, 2026. (AP)
A map of Bulgaria with the EU symbol is projected on the Bulgarian National Bank as people celebrate New Year's Eve and Bulgaria's adoption of the euro in Sofia, Bulgaria, Thursday Jan. 1, 2026. (AP)
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Bulgaria Adopts the Euro, Nearly 20 Years After Joining the EU

A map of Bulgaria with the EU symbol is projected on the Bulgarian National Bank as people celebrate New Year's Eve and Bulgaria's adoption of the euro in Sofia, Bulgaria, Thursday Jan. 1, 2026. (AP)
A map of Bulgaria with the EU symbol is projected on the Bulgarian National Bank as people celebrate New Year's Eve and Bulgaria's adoption of the euro in Sofia, Bulgaria, Thursday Jan. 1, 2026. (AP)

Bulgaria became the 21st country to switch to the euro as it entered the New Year on Thursday, a milestone met with both cheers and fears, nearly 20 years after the Balkan nation joined the European Union.

At midnight (2200 GMT Wednesday), Bulgaria gave up the lev currency, which has been in use since the late 19th century, and Bulgarian euro coins were projected onto the central bank's building.

Successive governments in the country of 6.4 million people have advocated joining the euro, hoping that it will boost the economy of the European Union's poorest member, reinforce ties to the West and protect against Russia's influence.

But Bulgarians have long been divided over the switch, with many worrying the introduction could usher in higher prices and add to the political instability rattling the country.

In a speech broadcast shortly before midnight, President Rumen Radev hailed the euro adoption as the "final step" in Bulgaria's EU integration, as thousands of people braved sub-zero temperatures in the capital Sofia to celebrate the New Year.

Radev however voiced regret that Bulgarians had not been consulted by referendum on the adoption.

"This refusal was one of the dramatic symptoms of the deep divide between the political class and the people, confirmed by mass demonstrations across the country."

Anti-corruption protests swept a conservative-led government from office in mid-December, leaving a country anxious about inflation on the verge of its eighth election in five years.

"People are afraid that prices will rise, while salaries will remain the same," a woman in her 40s who declined to give her name told AFP in Sofia.

At one of the city's largest markets, stalls displayed prices of everything from groceries to New Year's Eve essentials like sparklers in both levs and euros.

"The whole of Europe has managed with the euro, we'll manage too," retiree Vlad told AFP.

- Easier trade, travel -

European Commission president Ursula von der Leyen said Wednesday that Bulgaria's move into the eurozone marked "an important milestone" that would bring "practical benefits" to Bulgarians.

"It will make travelling and living abroad easier, boost the transparency and competitiveness of markets, and facilitate trade," she said.

Central bank governor Dimitar Radev said the euro symbolized much more than "just a currency -- it is a sign of belonging".

But according to the latest Eurobarometer survey, 49 percent of Bulgarians are against the switch.

Outgoing prime minister Rossen Jeliazkov sought to reassure the public ahead of the move, saying he was "counting on the tolerance and understanding of citizens and businesses".

He added that inflation in the Black Sea nation, which joined the EU in 2007, was not linked to the euro's adoption.

But the concerns of Bulgarians about inflation are not idle.

Food prices rose by five percent year-on-year in November, more than double the eurozone average, according to the National Statistical Institute.

"Unfortunately, prices no longer correspond to those in levs," pastry shop owner Turgut Ismail, 33, told AFP, saying that prices have already begun surging.

A euro protest campaign earlier this year tapping into a generally negative view of the single currency among much of the population also fanned fears of price hikes.

- Queues and possible disruptions -

Given Bulgaria's ongoing political instability, any problems with euro adoption would be seized on by anti-EU politicians, warned Boryana Dimitrova of the Alpha Research polling institute.

Some people, including business owners, have complained that it has been difficult to get their hands on euros, with shopkeepers saying they haven't received the euro starter packages they ordered.

Banks said there could be some disruption at cash machines in the hours surrounding the switch. Earlier this week, people queued outside the Bulgarian National Bank and several currency exchange offices in Sofia to obtain euros.

The euro was first rolled out in 12 countries on January 1, 2002. Croatia was the latest to join, in 2023.

Bulgaria's accession will bring the number of Europeans using the euro to more than 350 million.