McDonald's (DCM) – Get a free report joined a growing list of companies eager to tout the potential of artificial intelligence to boost sales and profits through a partnership with Google. (GOOGLE) – Get a free report It says it will help expand its global loyalty base to around 250 million.
McDonald's said that through a cloud computing agreement with Alphabet's (GOOGLE) – Get a free report Google, would use so-called generative ai to accelerate innovation in its teams, detect trends that disrupt its business and supply chain processes, and reduce complexity for restaurant staff.
The world's largest restaurant chain says the move will collectively result in “customer benefits, such as hotter and fresher food” across its global restaurant system.
“We are focused on making ai more useful for everyone, with the potential to unlock many new opportunities for innovation,” said Google CEO Sundar Pichai.
“The restaurant industry is already benefiting from these advancements, and we are excited to see how McDonald's will use our generative ai, cloud and edge computing tools to enhance its iconic dining experience for its employees and customers around the world.” he added.
McDonald's product quality campaign
The ai plans are part of McDonald's ongoing product quality drive. The chain is looking to grow its global restaurant base by around 10,000 sites over the next three years, while increasing its loyalty program membership, currently pegged at 150 million, by around two-thirds.
McDonald's said that would put it on track to add another $45 billion in sales by 2027.
“We have a clear trajectory for future growth as we continue to build on the strength of the brand, global footprint and digital ecosystem that have resulted in unparalleled competitive advantages and established McDonald's as one of the leading consumer-facing brands.” in the world,” said CEO Chris Kempczinski. .
The group will also implement a new universal software system for all McDonald's restaurants, as well as its digital platforms and kiosks. He says that will ensure “less complexity and more stability; and customers will enjoy a more familiar and consistent experience no matter where they go or how they order.”
“The scale of incoming information from all corners of the world will allow McDonald's GenAI models to better understand the widest range of patterns and nuances, resulting in more informed testing and automated solutions to improve restaurant operations,” McDonald's said.
Earlier this fall, Reuters reported that McDonald's was raising its annual fees for new franchisees by 4% to 5%, marking the first increase in three decades.
It would come as the group continued to find ways to widen profit margins while focusing on advertising campaigns aimed at value-conscious diners still affected by high inflation in the world's largest economy.
MCD Q3: More sales with lower margins
McDonald's said same-store sales for the three months ended in September rose 8.8%, firmly above Wall Street forecasts, while U.S. sales rose 8.1% boosted by “a strong average check growth driven by strategic menu price increases.”
Group revenue rose 14% to $6.69 billion, beating analyst estimates of a figure of $6.58 billion, with the overall figure slightly tempered by the strength of the US dollar.
Shares of McDonald's, which have underperformed both the Dow's 9.3% gain and the S&P 500's nearly 20% gain so far this year, last fell 0.6%, trading at $284.90 each.
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