The restaurant industry faces a long and uneven recovery

Yahoo Finance’s Brian Sozzi, Myles Udland, and Julie Hyman discuss the restaurant industry's path to recovery amid COVID-19.

Video Transcript

JULIE HYMAN: Let's turn back here to the US and what we have seen in the restaurant industry, which is something that Myles wrote about in this morning's Yahoo Finance Morning Brief. And as I mentioned in the tease, Myles, it's really fascinating because there has been so much attention given to the closure of so many thousands of restaurants that look like they're going to be permanent on the local level, right, mom and pops, whereas, you know, fast food seems to be thriving.

MYLES UDLAND: Yeah, I mean, you look at the stock performance of a company like a Chipotle. You look at the major pizza chains, Domino's, Papa John's among them. McDonald's has had a great run. QSR, parent of Burger King, Popeye's, they've had a nice run here in the pandemic because they have the resources to give their staff PPE. They can keep the restaurants open. They have the capital to get through this time.

But, you know, a chart that we just were showing there, that's restaurant employment, full-service restaurant employment here in New York City. It's 47% of what it was back in February. The restaurant industry here in the city has been decimated.

And if you look at the results-- kind of one of my favorite tricks here in business media. I think we all do it. You take company-level micro news and you bring it out to a macro theme, and what we saw Monday of this week is we saw McDonald's with their best comp sales number in a decade in September, their best monthly comps that they've seen in a couple generations of management over there.

Meanwhile, Beyond Meat-- which we're going to talk to the CEO Ethan Brown later in the show-- they had a tough quarter, and they particularly had a tough quarter in the food-services part of their business. Revenue there was down 11% in the US. It was down over 60% internationally because a lot of Beyond's distribution to this point has been to independent restaurants, more forward thinking, more creative chefs who are willing to do different things with the menu. And Beyond and some other companies like Impossible, that's a big part of that strategy, but they're closing.

You know, we've had about 15,000 restaurants close since March permanently, notwithstanding the ones that remain closed in the interim. And so that really shows how if you're a big multinational, this has been great for you. Not only can you get through it because you have the resources, you're actually gaining share because some of your smaller competitors that I think we'd all prefer to go to one of those restaurants, they're closed, and they're not going to be able to make it through the next, you know, four or five months with COVID cases with 25% capacity and without additional, you know, PPP loans, things like that to get them through this time because you just do not have the resources, you know, if you're a restaurant that's doing, you know, maybe a million or two in revenue a year.

JULIE HYMAN: Yeah, unfortunately not. And that all has implications for the jobs picture as well, which we will get into at another time.