McDonald’s CEO says ‘misinformation’ about Israel-Hamas war hurting sales

The top executive at McDonald’s said that “misinformation” about the company’s position on the ongoing Israel-Hamas war has hurt sales in the Middle East and in Muslim countries worldwide.

Chris Kempczinski, the president and CEO of McDonald’s, acknowledged on Thursday that “several markets in the Middle East and some outside the region are experiencing a meaningful business impact due to the war and associated misinformation that is affecting brands like McDonald’s.”

As calls to boycott the US fast-food giant have grown, Kempczinski wrote in a LinkedIn post that he found the development “disheartening and ill-founded.”

“In every country where we operate, including in Muslim countries, McDonald’s is proudly represented by local owner operators who work tirelessly to serve and support their communities while employing thousands of their fellow citizens.”

In the days following the Oct. 7 Hamas attack, the “local owner operator” distinction was lost on a mob of protesters in Lebanon who ransacked a local McDonald’s restaurant after McDonald’s Israel franchises said they would offer free meals to Israeli soldiers taking part in military operations in Gaza.

McDonald’s Israel said on its social media accounts that it had given thousands of free meals to Israel Defense Forces soldiers.

The Israel franchisee’s efforts were later renounced by McDonald’s franchises in some Muslim countries, highlighting the polarized regional politics that global corporations navigate during war.

Kempczinski did not specify the extent to which the company has suffered financial losses as a result of boycotts.

His LinkedIn post echoes comments recently made by Starbucks CEO Laxman Narasimhan, who said that people protesting the company over its stance on the Israel-Hamas war have been “influenced by misrepresentation on social media” of what the Seattle-based coffee chain stands for.

A Turkish television broadcaster recently fired a news anchor after she appeared on the air with a cup of Starbucks coffee — a sign that critics charge was tantamount to a show of support for Israel.

Boycotts of Starbucks in the weeks following the outbreak of war in the MIddle East cost the company up to $12 billion in value.

In the third quarter of last fiscal year, McDonald’s reported an 8.3% increase in sales in international markets, but that was before the Oct. 7 attack by Hamas terrorists which left 1,200 Israelis dead.

McDonald’s is expected to report fourth quarter results later this month.

Shares of McDonald’s were trading lower by 1.3% as of mid-day on Friday.

As of fiscal 2022, the company franchised and operated about 40,275 McDonald’s restaurants across more than 100 countries.

The fast-food chain reported total annual revenue of $23.18 billion in the year.

McDonald’s Malaysia has sued a movement promoting boycotts against Israel for “false and defamatory statements” that it says hurt its business, seeking damages amounting to $1.31 million.

Malaysia, a majority-Muslim country, is a staunch supporter of the Palestinians, and some Western fast-food brands in the country, as in some other Muslim nations, have been targeted by boycott campaigns over Israel’s military offensive in Gaza.

Gerbang Alaf Restaurants Sdn Bhd (GAR), which is the licencee of McDonald’s in Malaysia, is suing the Boycott, Divestment and Sanctions (BDS) Malaysia movement for a series of social media postings allegedly linking the fast-food franchise, among other companies, to Israel’s “genocidal war against Palestinians in Gaza.”

In response, BDS Malaysia said it “categorically denies” defaming the fast-food company and would leave the matter to the court.

With Post Wires