I think it's probably safe to bet that no food franchise has ever, in the history of either food or franchises, had to deal with a problem of this magnitude and intractability:
[McDonald's] announced last month that it would temporarily close its restaurants in Russia because of the country's invasion of Ukraine. It also closed restaurants in Ukraine. Those shutdowns cost McDonald's $127 million last quarter.
McDonald's said in March that it would continue to pay its 62,000 Russian employees, despite shuttering operations in the country. CEO Chris Kempczinski added during a Thursday call with analysts that McDonald's is supporting Ukrainian employees too: "In both countries, we have continued to pay employees and provide additional support."
"Wow," you might say, "The company is shelling out $127 million for its 62,000 Russian employees! That is incredibly generous of them! I'm so inspired I could just dance!"
Well... it's not quite that simple:
Those staff costs, plus payments for leases and supplies, cost the company $27 million.
The other $100 million was from food and other items it will have to get rid of.
Yeah, so the company is having to plunk down $100 million just to liquidate the stuff it can't serve in Russia anymore. That's... a ton of money. That's a ton of food (and "other items").
I mean, it's still very commendable. They're taking a $100 million hit on the nose in protest over Russia's insane warmongering. That's not chump change, even for a company whose profits run in the double-digit billions!
P.S. Now check out our latest video 👇
