FAST FOOD GIANT McDonald’s sales have jumped 12.6% globally in the first quarter of this year compared to 2022, even as customers showed caution toward ‘added costs’.

Sales rose 12.6% compared to the January-March period last year, well above the 8.7% increase that was forecast on Wall Street.

Restaurant traffic for the chain grew despite increases in prices.

CEO Chris Kempczinski said the company is starting to see resistance to price increases in many markets. Customers may not add fries to an order, for example, and delivery orders have slowed as customers rethink the additional cost.

“It’s a reminder that we need to stay very disciplined on pricing,” Kempczinski told a conference call with investors today.

“The customer certainly is dealing with some of the stress and pressures on that.” 

A lower demand in early 2022 due to continued Covid-19 restrictions in parts of the world like China helped the growth in sales this year.

Marketing campaigns, like a McSpicy chicken sandwich promotion with a streetwear brand in China, and a Valentine’s Day meal promotion in the US with rappers Offset and Cardi B, also boosted the chain’s performance.

However, the company has also had to account for higher prices for food, paper and workers.

Chief financial officer Ian Borden said inflation is on a downward trend in the US but remains elevated. In Europe, the company expects double-digit percentage inflation to continue for the rest of this year.

“Europe is working through the eye of the storm,” Borden saidsaid.

McDonald’s is hoping improvements to its menu will continue to drive traffic this year. The company announced this month that US restaurants will switch to softer buns and meltier cheese and change their grill settings to make their burgers juicier.

The changes have already rolled out some other markets, including Australia and Canada, where they have improved customer taste scores, according to the company.

Revenue rose 4% to nearly $5.9 billion US dollars in the first quarter, which also topped analyst projections of $5.6 billion dollars.

Despite the super-sized results, McDonald’s laid off several hundred corporate workers earlier this month in an effort to speed up innovation and decision-making.

McDonald’s recorded a restructuring charge of $180 million dollars during the first quarter to account for severance payments and the closure of some regional offices.