Blogs & Comment

Winners & Losers: Apple has “6” appeal and McDonald’s gets deep sixed


One bad iPad doesn’t spoil the whole bunch

Apple CEO Tim Cook unveils the sixth-generation iPhone. (Justin Sullivan/Getty)

(Justin Sullivan/Getty)

Consumers snapped up 39 million iPhones in the last quarter. That’s nearly 300 smartphones every minute. Apple’s latest financial results blew way past Wall Street’s expectations. The company generated more than $42 billion in sales and earned $8.5 billion in profit, largely on the popularity of the new iPhone 6 and 6 Plus models, proving that consumers don’t really care if their smartphones are a bit bendable. The one weak spot in the company’s results was the iPad, for which sales continue to slip. Apple is still trying to figure out how and when consumers upgrade to new tablets. Still, there are plenty of other initiatives on-the-go to keep Apple’s results booming. This week, it launched Apple Pay, which allows consumers to pay for things with their iPhones at partnering retailers, including Whole Foods and Walgreen. And the company will launch its highly anticipated smartwatch early next year. Meanwhile, BlackBerry’s latest product is a bulky square-shaped device optimized for looking at spreadsheets.


Smiles no longer free

Ronald McDonald looking sad

(Hamin Lee)

America’s most prominent fast-food chain just posted its worst financial quarter in years, with profit falling 30%. Most concerning is the 4.1% decline in same-store sales in the U.S. Higher prices and more intense competition are hurting the chain, not to mention that sense of shame and self-loathing many consumers experience at McDonald’s. Maybe you know the feeling, and that voice in your head whispering, “You’re better than this,” as you choke down another bite of desiccated grey hamburger meat. Loyal McDonald’s customers are cost sensitive, and the chain’s prices have been creeping up. Some items on its Dollar Menu actually cost close to five dollars. Younger consumers are also choosing fast-casual chains like Chipotle Mexican Grill over McDonald’s, which offers more customization options and fresh ingredients. McDonald’s plans to respond by introducing more customization into its own menu, part of what it’s billing as the “McDonald’s Experience of the Future” initiative. (Presumably, this future does not include the risk of serving expired meat—which the company’s China subsidiary ran into earlier this year when one of its suppliers was caught repackaging old ground beef.) Finally, the company is considering serving organic food in some markets. Personally, we can’t wait to chow down on some home-grown, organic azodicarbonamide.