Going out for a meal used to be such an easy expense to justify. A quick lunch, a weekend dinner, or even a fast-food run did not necessarily require much thought. But now, that almost seems like a luxury of the past.
McDonald's CEO Chris Kempczinski says restaurants should not expect customer traffic to bounce back soon. Especially with inflation putting pressure on household budgets, he expects restaurant traffic in key markets to stay stagnant.
His comments certainly raise a big question for the food industry: are people simply eating out less often?
Diners Are Cutting Back
Speaking to CNBC's Squawk on the Street, Kempczinski said McDonald's needs to stop looking at the current situation as a difficult period that will eventually pass. Instead, he said, the company needs to accept that this is the environment it is operating in because it does not expect things to change in the near future.
The National Restaurant Association data cited by CNBC showed a net decline in restaurant customer traffic in every month from August 2025 to July 2026, except one. That certainly doesn't mean that people have completely stopped going to restaurants. But yes, it's an indication that they are going less frequently.
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Now, people are switching to dinners at home, opting out of casual lunches, and waiting for payday for a fast-food order. Even when they do eat out, it's a well-thought-out decision.
Restaurant Prices Are Only One Part Of The Problem
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Naturally, it's the bills that are making people think twice before eating out, but it's not just coming from restaurants. Since consumers are also dealing with higher costs of groceries, fuel, etc., eating out has to compete with everything else people spend on.
To win back customers, McDonald's and several other chains introduced discounts and value offers. But the company's latest numbers show why it is looking beyond deals. Its US same-store sales increased just 0.8% in its most recent quarter, while traffic to its US restaurants declined, CNBC reported.
Reuters also reported that US foot traffic at McDonald's has fallen year over year in every complete month since March, based on estimates from data analytics company Placer.ai.
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As eMarketer analyst Suzy Davidkhanian told Reuters, consumers are not just making decisions based on what suits their budget, and McDonald's needs to give them reasons to visit beyond a deal. Hence, to give people more reasons to choose the restaurant, McDonald's is exploring options including bowls, grilled chicken and egg bites across breakfast, lunch and dinner.
At the same time, Kempczinski also told CNBC that McDonald's may still have to consider raising prices, although the company wants to avoid pushing customers away.