Recent announcements about enormous lay-offs, with vast cuts in the acquired Nokia handheld unit, do not bode well for long-term revenue growth at the decaying (yet cash rich) giant.
Since that sale, chipotle has outperformed McDonalds by 3x, and it was clear in 2011 that investors were better off with the faster growing Chipotle than the operationally focused McDonalds. .But, the company is facing serious strategic problems with its products, service and business model which leadership has shown no sign of addressing. .In May, 2008 the Growth Stall at AIG portended big problems for the Dow Jones Industrial (djia) giant as financial markets continued to shift radically and quickly. .Back in February, McDonalds sales in USA stores open at least 13 months fell.4. .Frequently this defend extend approach exacerbates the problems as retrenchment efforts further hurt revenues.Perhaps the most compelling case has been Microsoft. .Desperate for revenues as its products lagged changing customer tastes,.By February, 2010 a Growth Stall was impending (and confirmed by May, 2011 ) warning of big changes for the tech giant. .
And our research, in conjunction with The Conference Board, proved that when this happens the future becomes fairly easy to predict.
Back in 2006 McDonalds sold its fast growing Chipotle chain in order to raise additional funds to close some McDonalds stores, and undertake an overhaul of the supply chain as well as many remaining stores. .December, 2012 McDonalds was urging franchisees to stay open on Christmas Day in order to add just a bit more to the top line. .Now with offshore sales plummeting we can see that McDonalds American performance is the lead indicator of a company with serious performance issues.Yet, the company continues to ascribe its Growth Stall to short-term problems such as a meat processing scandal in China. .95 will lose more than 25 of their market value.Such scandals are not the cause of current poor results. .1 in 5 drop into a negative 6/year revenue slide.Mobile device sales exploded, sending Apple and Google stocks soaring, while Microsofts primary, core market for PCs (and software for PCs) has fallen into decline.Subsequently Motorola spun off its money losing phone business, sold other discount food vouchers blackpool assets and businesses, and is now a very small remnant of the business prior to its Growth Stall; which was brought on by an overwhelming market shift to smartphones from 2-way radios and traditional.May, 2009 I reported on the Growth Stall at Motorola which threatened to dramatically lower company value. .And this month the issue has become a front-and-center problem for McDonalds investors as the National Labor Relations Board (nlrb) has said it will not separate McDonalds from its franchisees in pay and hours disputes something which opens McDonalds deep pockets to litigants looking.