McDonald’s ‘Under Siege’ at Home and Abroad



McDonald’s Corp CEO Don Thompson sure could use a break.

The head of the world’s biggest restaurant chain, who for much of his two years at the helm has been battling to spark sales growth in the United States and Europe, got battered by headline-grabbing bad news in late July.

In the final days of the month, its China business was hit with a food-safety scare involving a key supplier; the chain got ensnared in the West’s sanctions standoff with Russia; burger flippers at US restaurants claimed an incremental win from the National Labor Relations Board in their fight to hold McDonald’s responsible for the actions of franchisees; and, a Texas jury slapped the company with a $27 million verdict. Add to all that its results showed second-quarter profit dropped more than expected.

“They’re under siege on three continents,” said Howard Penney, restaurant analyst at Hedgeye Risk Management, an investment research firm.

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