McDonald's out with a warning
We're nearing earnings season and that's when we're going to get some real-time commentary from executives on the impact of COVID-19.
McDonald's is out now and says Q1 comparatives sales were down 3.4% and the company withdrew its forecast. They will cut capex by $1 billion and said they drew $1B on a short-term credit line later this month.
McDonald's had a huge bond offering in March at very favourable terms. The company also has drivethru's at most of its locations. Overall, they said same-store sales were down 13.4% in March.
If McDonald's is suffering that much, what's it like for other restaurants?
Another company that issued a release late yesterday was Pinterest. They reported that Q1 revenues were going to be above guidance (and consensus) but withdrew guidance for the year.
"First-quarter revenue performance was consistent with our expectations through the middle of March, when we began to see a sharp deceleration. Fortunately, despite weakness across nearly the entire advertising market, our exposure to some of the most affected segments like travel, automotive, and restaurants has not been significant," said Todd Morgenfeld, CFO, Pinterest.
Even if a company has done ok early in the virus, I expect they will be cautious because it can change so quickly.
For now, US stock futures are up 1%.
