Long-predicted consumer pullback finally hits restaurants like Starbucks, KFC and McDonald's

Starbucks announced a surprise drop in same-store sales for its latest quarter, sending its shares down 17% on Wednesday. Pizza Hut and KFC also reported shrinking same-store sales. And even stalwart McDonald's said it has adopted a "street-fighting mentality" to compete for value-minded diners.

For months, economists have been predicting that consumers would cut back on their spending in response to higher prices and interest rates. But it's taken a while for fast-food chains to see their sales actually shrink, despite several quarters of warnings to investors that low-income consumers were weakening and other diners were trading down from pricier options.

Many restaurant companies also offered other reasons for their weak results this quarter. Starbucks said bad weather dragged its same-store sales lower. Yum Brands , the parent company of Pizza Hut, KFC and Taco Bell, blamed January's snowstorms and tough comparisons to a strong first quarter last year for its brands' poor performance.

But those excuses don't fully explain the weak quarterly results. Instead, it looks like the competition for a smaller pool of customers has grown fiercer as the diners still looking to buy a burger or cold brew become pickier with their cash.

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