It turns out that, no, fast-food eaters would not like fries with that. As more customers lose their appetite for fast food over sky-high prices, Nort

McDonald’s largest french fry maker lays off hundreds as Americans turn away from fries

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2024-10-10 17:30:07

It turns out that, no, fast-food eaters would not like fries with that. As more customers lose their appetite for fast food over sky-high prices, North America’s largest fry producer is reeling from the slowdown.

Lamb Weston, which can churn out 250 million pounds of frozen potato products annually at just one facility, announced earlier this month that it would lay off 4% of its workforce (about 428 workers) and shut down its Connell, Wash., production plant. Since the beginning of the year, its share price has plummeted by about 33%.

A Lamb Weston spokesperson told Fortune the closed plant was an older facility representing only 5% of the company’s capacity.

CEO Tom Werner said on an Oct. 1 earnings call that quick-service burger chains in particular are to blame for Lamb Weston’s slump. Traffic at those restaurants decreased 3% in the company’s first quarter, while restaurant traffic overall slumped 2% year over-year. Werner expects traffic to continue to falter through fiscal 2025.

McDonald’s is Lamb Weston’s largest customer, accounting for 13% of its sales. The potato processor also produces fries for Yum Brands, which owns KFC and Taco Bell.