Fast-food breakfast may have been a boon for the business for years, but sales now seem to be slowing. That’s what executives from two popular fast food chains are saying.
“McDonald’s and Wendy’ last week, during their respective earnings calls, said they’re seeing sluggish breakfast sales,” CBS MoneyWatch reported this week. “The companies attributed the trend to heightened economic uncertainty and pressures facing low-income consumers.”
For example, McDonald's CEO Christopher Kempczinski said “real incomes are down with the low-income consumer, that absolutely is going to put pressure on visits into the [quick-service retail] industry,” during the company’s Aug. 6 call. He also said that there is “a lot of anxiety and unease with that low-income consumer,” pointing to President Donald Trump’s ongoing tariff moves as a potential factor, as well as concerns about employment.
Overall, Kempczinski said this anxiety is cutting into breakfast sales at the fast food giant. It’s an industry-wide trend, he added.
“When consumer uncertainty increases and consumers choose to eat another meal at home, breakfast is often the first place that they do that with,” Wendy's interim CEO Ken Cook explained during the company's earnings call Aug. 8.
McDonald’s kicked off what the company calls a “fast food breakfast revolution,” back in 1975, when it debuted the Egg McMuffin.
According to Mashed, other chains followed suit, and the fast food breakfast climbed in popularity through the 1980s and 1990s to become a cultural staple.
“The rapid growth of fast food breakfast has been fueled by several factors, including consumers’ changing lifestyles. For instance, as more people entered the workforce in the 20th century, the demand for a quick and convenient breakfast increased,” said Mashed. “Fast food chains saw an opportunity to fill this need and accommodated time-strapped customers with a grab-and-go meal to enjoy during their commute or at their workplace.”
Many could relate to Adam Sandler’s character in the 1999 film “Big Daddy” when he despairs at not being able to get breakfast McDonald’s breakfast after 10:30 a.m. McDonald’s even caved and began offering all day breakfast in 2015, but it stopped amid the COVID-19 pandemic in 2020, per CNBC. Wendy’s stopped offering breakfast altogether but then brought it back in 2020. It now offers 10 items.
CBS said that today’s declining fast food breakfast sales stand in “stark contrast to the breakfast boom fast-food chains have enjoyed for nearly a decade, which led many restaurants over the years to expand their early morning offerings.” Mashed noted that there has also been increased competition as more chains enter the fast food game.
This summer, neither McDonald’s nor Wendy’s landed at the top of USA Today’s 10 Best Reader’s Choice awards list of fast food breakfast favorites. Del Taco – a chain that serves up Mexican-influenced breakfast options – was in the top spot, followed by Jack in the Box. Both chains are based in California.
Like Kempczinski and Cook, experts cited by CBS said that Americans are likely skipping the drive thru line at breakfast due to economic pressures impacting low and middle-income consumers. Inflation – and rising fast food prices – along with high interest rates make spending more difficult.
“The fact that the breakfast day part is slowing now, in our opinion, speaks to heightened economic uncertainty and the lower consumer confidence that we’ve seen, and that really escalated as tariff rhetoric came into the picture,” Matthew Todd, a director at S&P Global Ratings, told the outlet.