S&P 500
7,582.20
+0.03%
Dow Jones
51,018.80
+0.58%
Nasdaq 100
30,344.40
+0.25%
Russell 2000
2,916.31
-0.54%
FTSE 100
10,378.60
-0.32%
Nikkei 225
66,231.90
+0.67%

Retail

Will AI Slash McDonald’s Customer Base?

Photo of Douglas A. McIntyre
By Douglas A. McIntyre Published

Quick Read

  • Does Walmart Inc. (NYSE: WMT) pay its employees enough to afford to eat at McDonald’s Corp. (NYSE: MCD)?

  • Here is a look at the math.

  • It sounds nuts, but SoFi is giving new active invest users up to $1,000 in stock for a limited time, and all it takes is a $50 deposit to get started. See for yourself (Sponsor)
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Will AI Slash McDonald’s Customer Base?

© The cheapest, most nutritious,... (CC BY-SA 2.0) by Mike Prosser

McDonald’s Corp. (NYSE: MCD | MCD Price Prediction) has had trouble with low-income customers, its CEO, Christopher Kempczinski, said. “There’s some significant inflation there that the low-income consumer is having to absorb, and I think that’s affecting their outlook and their sentiment and their spending behavior.”

For the most part, McDonald’s earnings were modest. Total revenue rose 3% to $7.1 billion. Per-share earnings rose 2% to $3.18.

“Low income” does not have an exact definition. The Federal Poverty Level is $15,650 for a single person and $31,200 for a family of four.

Walmart Inc. (NYSE: WMT), the largest employer in America, recently stated that the average hourly wage of its front-line workers is $18. The figure can be as low as $14.

At $14 an hour, 40 hours a week, and 50 weeks a year, a Walmart employee makes $28,000 a year. That is before taxes, which would bring the figure to $25,000, or about $2,000 a month.

At an income of $15,000 to $30,000 per year, USA Facts shows that 38% of the income is allocated to housing, 18% to transportation, and 14% to food. That puts that amount for food at about $3,500 a year, or less than $300 a month.

McDonald’s has a $6 meal deal. That means a family of four can eat for $24 a meal. If the family only eats twice a day, the number goes to $48. Over the course of 30 days, the figure rises to $1,440.

The family gets a certain amount of government support, but a McDonald’s meal is still “expensive.” Can a Walmart employee eat at McDonald’s? It’s a close call.

AI Destruction of Millions of Jobs Begins

 

DISCLOSURE:
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA(www.finra.org)/SIPC(www.sipc.org). Advisory services are offered by SoFi Wealth LLC, an SEC-registered investment adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov. Probability of Member receiving $1,000 is a probability of 0.026%; If you don’t make a selection in 30 days, you’ll no longer qualify for the promo. Customer must fund their account with a minimum of $50.00 to qualify. Other fees, such as exchange fees, may apply. Please view our fee disclosure to view a full listing of fees. Investing in alternative investments and/or strategies may not be suitable for all investors and involves unique risks, including the risk of loss. An investor should consider their individual circumstances and any investment information, such as a prospectus, prior to investing. Interval Funds are illiquid instruments, the ability to trade on your timeline may be restricted. Brokerage and Active investing products offered through SoFi Securities LLC, Member FINRA(www.finra.org) /SIPC(www.sipc.org). There are limitations with fractional shares to consider before investing. During market hours fractional share orders are transmitted immediately in the order received. There may be system delays from receipt of your order until execution and market conditions may adversely impact execution prices. Outside of market hours orders are received on a not held basis and will be aggregated for each security then executed in the morning trade window of the next business day at market open. Share will be delivered at an average price received for executing the securities through a single batched order. Fractional shares may not be transferred to another firm. Fractional shares will be sold when a transfer or closure request is initiated. Please consider that selling securities is a taxable event. Options involve risks, including substantial risk of loss and the possibility an investor may lose the entire investment Before trading options please review the Characteristics and Risks of Standardized Options  Investing in an Initial Public Offering (IPO) involves substantial risk, including the risk of loss. Further, there are a variety of risk factors to consider when investing in an IPO, including but not limited to, unproven management, significant debt, and lack of operating history. For a comprehensive discussion of these risks please refer to SoFi Securities’ IPO Risk Disclosure Statement This should not be considered a recommendation to participate in IPOs and investors should carefully read the offering prospectus to determine whether an offering is consistent with their investment objectives, risk tolerance, and financial situation. New offerings generally have high demand and there are a limited number of shares available for distribution to participants. Many customers may not be allocated shares and share allocations may be significantly smaller than the shares requested in the customer’s initial offer (Indication of Interest). For more information on the allocation process please visit IPO Allocation.
Follow 24/7 Wall St. on Google
Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

Continue Reading

Mike Sauter |

Ten Companies Paying Americans the Least

courtesy of Wal-Mart Stores Inc.This summer, thousands of fast-food workers in the United States went on strike in cities across…

The $18 McDonald’s Meal
Douglas A. McIntyre |

The $18 McDonald’s Meal

McDonald’s management finds itself caught between increasing operating costs and consumers who are unhappy about rising prices.

Paul Ausick |

More Strikes for Higher Wages Coming in 160 Cities

Following the Black Friday strikes at more than 1,600 Walmart locations across the United States, fast-food workers will walk off…

Will New Minimum Wages Cripple McDonald’s?
Douglas A. McIntyre |

Will New Minimum Wages Cripple McDonald’s?

McDonald’s faces increases in the minimum wage in states across the country. It is a tough environment for the fast-food…

Thomas Frohlich |

Companies Paying Americans the Least

ThinkstockIn the wake of mounting protests from labor groups, numerous U.S. localities have approved minimum wage increases, including two of…

Thomas Frohlich |

Companies Paying Americans the Least

In the wake of mounting protests from labor groups, numerous U.S. localities have approved minimum wage increases, including two of…

Paul Ausick |

The Wage Hike to $15 Would Cost McDonald’s $8 Billion

courtesy of McDonald'sIt would cost McDonald’s Corp. (NYSE: MCD) and its franchisees more than $8 billion a year in the…

McDonald’s Troubles Deepen as Customers Won’t Return
Douglas A. McIntyre |

McDonald’s Troubles Deepen as Customers Won’t Return

It was another rough quarter for McDonald's, as the fast-food giant is being pressed on several fronts. Its stock has…

Chick-fil-A Price Jumps on Wage Rules
Douglas A. McIntyre |

Chick-fil-A Price Jumps on Wage Rules

After a rise in the minimum hourly wage in California, Chick-fil-A has raised prices on some of its meals there…

Top Gaining Stocks

Dell Technologies
DELL • Vol: 42,366,555
NetApp
NTAP • Vol: 15,911,807
ServiceNow
NOW • Vol: 68,243,561
IBM
IBM • Vol: 28,527,546
Hewlett Packard Enterprise
HPE • Vol: 86,996,387

Top Losing Stocks

Coterra Energy
CTRA • Vol: 73,319,495
Clorox
CLX • Vol: 4,744,001
ResMed
RMD • Vol: 3,526,686
Intel
INTC • Vol: 191,680,425
Skyworks Solutions
SWKS • Vol: 5,407,806