Can Taco Bell Really Hurt McDonald’s Breakfast?

Is Taco Bell’s breakfast giving McDonald’s a wake-up call?

The Yum chain’s launch in late March went directly after McDonald’s with marketing that aggressively framed the Golden Arches as hopelessly outdated, and trumpeting Taco Bell as the next generation of fast-food breakfast. Its cheeky TV ads used real-life Ronald McDonald’s proclaiming their love for Taco Bell’s morning fare.

The first clue to whether this audacious play is playing off came during Yum’s second quarter earnings this week. Yum Brands CEO David Novak said in an earnings call last week that breakfast comprised around 7% of sales in the quarter and that Taco Bell’s sales in U.S. stores open at least a year increased 2% from the quarter a year earlier.

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