McDonald’s and Starbucks Blame Israel Hamas Conflict for Slower Sales

McDonald’s Sales Hit Hard

McDonald’s, the big fast-food chain with the golden arches, had a tough time selling burgers and fries at the end of last year. They’re saying the Israel-Hamas fight is one of the reasons for their sales slump. They had less money coming in during the fourth quarter, especially from the Middle East. One big reason for this was that in Israel, they were giving discounts to soldiers, and some people got mad and stopped buying from them. Andrew Charles, who knows a lot about money stuff, says the Middle East usually gives McDonald’s about 2% of all the money they make globally, and 1% of what they earn before taking out things like taxes.

Starbucks’ Problems Too

Starbucks, the famous coffee shop everyone loves, had similar issues. They also blamed the Israel-Hamas conflict for their drop in sales, especially in the U.S. During the last part of the year, they didn’t sell as many lattes and frappuccinos as they wanted to. CEO Laxman Narasimhan said it wasn’t just the Middle East that hurt their sales; it was also because some people got mad at Starbucks in the U.S. Starbucks Workers United, which is like a group that helps Starbucks employees, posted support for Palestinians. Some people didn’t like that and stopped going to Starbucks. Even though Starbucks said they didn’t agree with the post and even sued the group, they still lost some customers.

Boycotts Hurt Both

The impact of boycotts wasn’t just felt in the Middle East; it also hit Starbucks in the U.S. Even though Starbucks’ U.S. stores made 5% more money during the first quarter, fewer people came in. Narasimhan said it was mostly the occasional customers who stopped showing up. To try and get more people back, Starbucks is planning to offer special deals and come up with new drinks.

McDonald’s Sales Drop in Muslim Countries

McDonald’s CEO Chris Kempczinski talked about how the conflict affected their sales in countries where most people are Muslim, like Malaysia and Indonesia. Even in France, where there are a lot of Muslims, sales went down. Some people were mad about the prices too.

What’s Next?

Both McDonald’s and Starbucks think they’ll still have a tough time because of the Israel-Hamas fight. They worry it might hurt their sales in the future. We don’t know yet how other food places will do in the same situation, but McDonald’s and Starbucks show how what happens in the world can affect what we buy and where we go.

In Summary

The Israel-Hamas conflict caused McDonald’s and Starbucks restaurant to sell fewer burgers and coffees. Even though they tried to fix things, like offering discounts and suing people, they still lost customers. This shows how big events like wars can change how businesses do and what we choose to buy.