McDonald's hit by first sales drop since 2020 amid boycott campaign over Gaza

The McDonald’s fast food chain has experienced its first decline in global sales in almost four years, significantly affected by a boycott campaign initiated by Palestinian supporters around the globe amid the ongoing Israel’s war on Gaza.

McDonald’s worldwide sales dropped by 1% in the April-June period, marking the first decline since the fourth quarter of 2020 due to the impact of the COVID-19 pandemic and government-imposed restrictions, the company reported on Monday.

The ongoing anti-Israel boycott was not addressed in the report explicitly, which instead attributed the decline to customers being "more discriminating with their spend."

McDonald's blamed the decline in sales to a decrease in US customer traffic, partially mitigated by price increases, as well as the continued impact of the war in West Asia and reduced demand in China.

The report showed that the net income of McDonald’s decreased 12 percent to a little over $2 billion in the second quarter of the year. The global decline in comparable sales, which covers company-owned and franchised stores open for at least 13 months, marks the first fall since the last quarter of 2020.

 “While quarterly revenue of $6.49bn was roughly unchanged from a year ago, net profit declined 12 percent to $2.02bn, missing Wall Street expectations,” said Chris Kempczinski, the company’s chief executive.

Kempczinski told analysts that consumer sentiment in most major McDonald’s markets was low.

McDonald’s has more than 40,000 restaurants in over 100 countries. Its international sale declined by over 1% has prompted the company to issue a caution about the negative impact of the Gaza war on its operations in certain nations in the West Asia region  along with Indonesia and Malaysia.

McDonald’s, Starbucks tank, blame boycott campaign amid Israeli war on Gaza

The US giant food chain McDonald’s and coffee chain Starbucks both blamed pro-Palestine boycott campaigns for slower sales after they saw grassroots protests over their pro-Israeli stance in the Gaza war.

The current boycott campaign against Israeli goods began in October 2023 after McDonald’s in the Israeli occupied Palestinian territories announced that it had donated thousands of free meals to Israeli soldiers.

The announcement sparked an immediate backlash, particularly in Muslim countries sympathetic to the Palestinian cause, and also prompted calls for a consumer boycott against the apartheid entity.

Other American companies, including Starbucks, Burger King, KFC, Pizza Hut, and Papa John’s, as well as brands such as Coca-Cola, Pepsi, Wix, Puma, and Zara that have pro-Israeli stances or financial ties with Israel and investments there have also came under fire and faced boycott calls.

Starbucks lays off workers in Middle East branches after pro-Palestine boycott

Starbucks’ West Asia franchisee has fired 2,000 of its staff after suffering huge losses owing to boycott campaign led by Palestinian supporters during Israel’s war on Gaza.

The current boycott campaign could be considered the latest part of the pro-Palestine Boycott, Divestment and Sanctions (BDS) movement against the Israeli regime.

Thousands of volunteers worldwide have joined the BDS movement, which calls for people and groups across the world to cut economic, cultural, and academic ties to Tel Aviv to help promote the Palestinian cause. The movement has been so successful in causing economic damage to the regime, which pro-Israel groups have labeled “an existential threat.”

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