MCD
CyclicalMcDonald's
Price Chart
Market Data
Financials
XBRL · SEC EDGAR2007–2025(19yr)| Metric | FY 2007 | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $22.8B | $23.5B | $22.7B | $24.1B | $27.0B | $27.6B | $28.1B | $27.4B | $25.4B | $24.6B | $22.8B | $21.0B | $21.1B | $19.2B | $23.2B | $23.2B | $25.5B | $25.9B | $26.9B | +3.7% |
| Operating Income | $3.9B | $6.4B | $6.8B | $7.5B | $8.5B | $8.6B | $8.8B | $7.9B | $7.1B | $7.7B | $9.6B | $8.8B | $9.1B | $7.3B | $10.4B | $9.4B | $11.6B | $11.7B | $12.4B | +5.8% |
| Operating Margin | 17.0% | 27.4% | 30.1% | 31.0% | 31.6% | 31.2% | 31.2% | 29.0% | 28.1% | 31.5% | 41.9% | 42.0% | 43.0% | 38.1% | 44.6% | 40.4% | 45.7% | 45.2% | 46.1% | +0.9pp |
| Net Income | $2.4B | $4.3B | $4.6B | $4.9B | $5.5B | $5.5B | $5.6B | $4.8B | $4.5B | $4.7B | $5.2B | $5.9B | $6.0B | $4.7B | $7.5B | $6.2B | $8.5B | $8.2B | $8.6B | +4.1% |
| Net Margin | 10.5% | 18.3% | 20.0% | 20.5% | 20.4% | 19.8% | 19.9% | 17.3% | 17.8% | 19.0% | 22.8% | 28.2% | 28.6% | 24.6% | 32.5% | 26.6% | 33.2% | 31.7% | 31.9% | +0.1pp |
| Free Cash Flow | $2.9B | $3.8B | $3.8B | $4.2B | $4.4B | $3.9B | $4.3B | $4.1B | $4.7B | $4.2B | $3.7B | $4.2B | $5.7B | $4.6B | $7.1B | $5.5B | $7.3B | $6.7B | $7.2B | +7.7% |
| FCF Margin | 12.9% | 16.1% | 16.7% | 17.5% | 16.4% | 14.2% | 15.3% | 15.1% | 18.6% | 17.2% | 16.2% | 20.1% | 27.2% | 24.1% | 30.6% | 23.7% | 28.5% | 25.7% | 26.7% | +1.0pp |
| EPS (Diluted) | $1.98 | $3.76 | $4.11 | $4.58 | $5.27 | $5.36 | $5.55 | $4.82 | $4.80 | $5.44 | $6.37 | $7.54 | $7.88 | $6.31 | $10.04 | $8.33 | $11.56 | $11.39 | $11.95 | +4.9% |
1. THE BIG PICTURE
McDonald’s has successfully decoupled its profit growth from the daily volatility of the restaurant business by offloading 95% of its operational risks to franchisees while retaining ownership of the underlying real estate. This "three-legged stool" model allows McDonald's to extract industry-leading margins from rent and royalties, effectively turning a global fast-food footprint into a stable, technology-driven cash machine.
2. WHERE THE RISKS HIT HARDEST
McDonald's’s "predictable revenue" and high restaurant performance levels are threatened by franchisee financial dependency. Because McDonald’s relies on these partners for rent and royalty fees, any inability of franchisees to secure financing for capital-intensive "4D" initiatives (Digital, Delivery, Drive-Thru, and Development) directly jeopardizes the "Accelerating the Arches" growth strategy (Business, Risks). Furthermore, the Global Brand—identified as a material asset—is vulnerable to "negative consumer perceptions" regarding food quality or social practices. Because the menu is "substantially uniform," a localized brand crisis can quickly escalate into a systemic decline in guest counts across 100 countries (Business, Competitive Position).
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a business that operates with extreme efficiency compared to its peers. McDonald’s maintains a 46.4% operating margin and a 28.0% FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin, both of which rank first among a peer group that includes Starbucks and Hilton (Peer Benchmarking). While its TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth of 3.7% appears modest, the most recent quarter showed a significant acceleration to 10% growth, totaling $7.01 billion (Recent Results).
This divergence is largely structural, driven by the "Accelerating the Arches" strategy. Specifically, the loyalty program grew to 210 million active users, fueling nearly $37 billion in annual systemwide sales (Recent Results). This digital shift is helping to offset the "Real Estate Portfolio Rigidity" mentioned in the risk factors by increasing throughput at existing locations without requiring immediate physical expansion.
4. IS IT WORTH IT AT THIS PRICE?
At 22.9x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, McDonald’s trades at a 19% discount to the peer median of 28.3x (Peer Benchmarking). According to the market-implied growth analysis, the current price assumes 2.9% long-term growth (Computed Valuation Context).
This valuation appears conservative given that global comparable sales grew 5.7% in the most recent quarter and McDonald's just raised its dividend by 5% (Recent Results). The discount likely reflects McDonald's’s significant debt load—$38.9 billion in net debt, representing 5.2x net leverage—which is substantially higher than peers like Nike or TJX (Peer Benchmarking). Investors are paying a lower multiple for McDonald’s superior margins because of this leverage and the inherent risk that franchisees may struggle to maintain "value leadership" in an inflationary environment.
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if "guest counts" in the U.S. segment begin to turn negative, suggesting that marketing promotions and the "Best Burger" initiatives are no longer enough to offset intense competition in the "informal eating out" segment (Recent Results, Competitive Position).
- Constructive if the "Accelerating the Organization" restructuring efforts lead to a sustained reduction in the $80 million quarterly pre-tax charges, signaling that McDonald's has streamlined its global business services (Recent Results).
6. BOTTOM LINE
Structural Advantage: A massive, proprietary real estate portfolio combined with a 95% franchised model that generates the highest free cash flow margins in its peer group.
Bottom Line: McDonald’s is a high-efficiency cash generator trading at a discount to slower-growing peers, making it an attractive defensive play if you believe its franchisees can continue to fund its digital evolution.
1. Top 5 Material Risks
- Strategy Execution: Failure to effectively execute the "Accelerating the Arches" strategy—including digital, delivery, and drive-thru initiatives—could result in a decline in Systemwide sales, operating income, and free cash flow.
- Brand Value: Negative consumer perceptions regarding food quality, ingredients, or social/environmental practices, whether accurate or not, can damage the McDonald's brand and lead to reduced financial results.
- Competitive Environment: Intense competition from traditional, fast-casual, and non-traditional participants (such as convenience stores and online retailers) threatens market share and guest counts if McDonald's fails to respond to shifting consumer preferences.
- Franchise Model Dependencies: Because McDonald's relies on franchisees for rent and royalty fees, any decline in franchisee sales trends or their inability to secure financing for reinvestment directly impacts McDonald's's financial results.
- Global Operational Disruptions: Operating in over 100 countries exposes McDonald's to risks including political instability, trade-related tariffs, government-mandated closures, and acts of war, which can disrupt operations and increase costs.
2. Company-Specific Risks
- Real Estate Portfolio Rigidity: McDonald's owns or holds long-term leases on most restaurant sites, limiting its flexibility to quickly relocate or alter its portfolio in response to changing trade area demographics or consumer behavior.
- Technology and AI Integration: McDonald's’s increasing reliance on AI-driven tools and digital platforms introduces risks related to data integrity, algorithmic bias, and potential operational disruptions that could harm customer experience.
- Supply Chain Concentration: While sourcing is global, certain items have limited suppliers, increasing the risk that supply chain interruptions—whether from labor issues, weather, or geopolitical events—could delay restaurant openings or limit product availability.
- Succession Planning: The long-term success of McDonald's is dependent on the effective recruitment and retention of key management personnel; failure to execute smooth transitions could disrupt business operations.
3. Regulatory/Legal Risks
- Franchise Relationship Litigation: Legal challenges regarding the distinction between McDonald's and its franchisees for employment law purposes could increase costs and subject McDonald's to incremental liability for franchisee actions.
- Privacy and Data Protection: Failure to comply with evolving global privacy laws (such as the EU’s GDPR or U.S. state-level regulations) could result in substantial administrative fines, civil penalties, and reputational damage.
- Tax Law Changes: McDonald's is subject to income and other taxes in the U.S. and foreign jurisdictions; changes in tax policy or unfavorable resolutions of tax audits could materially impact profitability.
- Intellectual Property Disputes: McDonald's faces risks from aggressive or opportunistic patent enforcement, particularly in information technology systems, which could result in costly litigation and operational interference.
4. Financial Impact Map
Strategy Execution → Operating Income and Free Cash Flow → Failure to drive Systemwide sales directly reduces the primary drivers of these metrics. Franchise Model Dependencies → Franchised Restaurant Revenues → Rent and royalty fees are directly tied to the sales performance and financial health of independent franchisees. Global Operational Disruptions → Operating Results → Government-mandated closures, tariffs, and trade policies can increase costs and limit revenue in specific geographic markets. Commodity and Operating Costs → Company-owned and Operated Margins → Volatility in food, paper, and labor costs directly impacts the profitability of restaurants owned by McDonald's. Real Estate Portfolio → Operating Results → Inability to manage real estate locations effectively can adversely affect Systemwide sales and profitability due to limited flexibility in long-term lease commitments.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-K | Feb 2026 | Dec 2025 |
| 8-K | Feb 2026 | — |
| 10-Q | Nov 2025 | Sep 2025 |
| 14A | Apr 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
McDonald's launches new value meal deals starting April 21st to drive foot traffic
- ▸New value menu features breakfast combos under $3 and lunch combos from $5
- ▸Lunch deals include McChicken or McDouble, 4-piece nuggets, small fries, and drink
- ▸Breakfast options include sausage biscuit or McMuffin, hash browns, and medium coffee
- ▸Strategy aims to improve consumer value perception and increase store traffic
- ▸Previous US same-store sales grew 6.8% in the latest reported quarter
McDonald's to Launch New McCafé Beverage Lineup in 2026 Targeting $100B Market Opportunity
- ▸Targeting $100B global beverage category opportunity with 2026 rollout
- ▸New lineup includes energy drinks, iced coffees, refreshers, and crafted sodas
- ▸Q4 U.S. pilot across 500+ restaurants exceeded performance expectations
- ▸Testing showed increased average check and incremental visits across multiple dayparts
- ▸Expanding Red Bull partnership as part of broader beverage growth strategy
McDonald's Big Arch launch drives $18M in viral buzz, foot traffic rises 2.2%
- ▸Viral Big Arch marketing generated estimated $18M in brand value during March
- ▸U.S. foot traffic increased 2.2% during launch week of March 3
- ▸Early sales for Big Arch burger reported to be beating internal expectations
- ▸Lower-income consumer spending continues to decline, pressuring barbell pricing strategy
- ▸Company expanding value menu with $3 and under items and $4 breakfast bundles
McDonald's Big Arch burger launch drives modest 2.2% year-over-year traffic increase
- ▸Big Arch burger launch drove 2.2% YoY traffic increase for week of March 3
- ▸Premium burger strategy aims to protect margins amid intense promotional environment
- ▸Traffic growth follows February trend of mid-single-digit gains
- ▸Company shifting focus to McValue 2.0 and $3 price point offerings
- ▸Q4 same-store sales rose 6.8% driven by lower-income consumer traffic
McDonald's to launch $3 value menu in April to capture budget-conscious consumers
- ▸New value menu launching April with items priced at $3 or less
- ▸Includes 4-piece Chicken McNuggets and Sausage Biscuit at $3 price point
- ▸New $4 breakfast bundle includes McMuffin, hash brown, and coffee
- ▸Replacing McValue platform launched in January 2025
- ▸Strategy targets lower-income consumers sensitive to inflation and stagnating wages
McDonald’s to launch $3 value menu and $4 breakfast deals in April
- ▸New menu items priced at $3 or less launching in April
- ▸Breakfast meal deals to be priced at $4
- ▸Initiative internally referred to as 'McValue 2.0'
- ▸Breakfast bundle includes McMuffin, hash brown, and coffee
- ▸Strategy aims to recapture lower-income customers amid economic pressure
McDonald's Q4 same-store sales grow 6.8% driven by value meal pricing strategy
- ▸McDonald's Q4 same-store sales +6.8% YoY
- ▸Extra Value Meal discounts reduced combo prices below $10
- ▸Gained market share among low-income consumers in December
- ▸Sweetgreen reported worst quarter as public company
- ▸Chipotle and Wingstop experienced same-store sales declines in Q4
McDonald's Q4 EPS $3.12 beats $3.05 estimate, revenue $7B up 10% YoY
- ▸Q4 adjusted EPS $3.12 vs $3.05 estimate
- ▸Q4 revenue $7B, up 10% YoY, beating $6.85B estimate
- ▸Global comparable sales rose 5.7% YoY
- ▸U.S. comparable sales increased 6.8% YoY
- ▸Company-operated restaurant sales $2.54B, up 10% YoY
McDonald's to launch $3 value menu and $4 breakfast combos next month
- ▸New $3 and under menu launching next month
- ▸Planned $4 breakfast combo includes McMuffin, hash brown, and coffee
- ▸Menu items to include four-piece McNuggets and sausage biscuits
- ▸Strategy aims to capture value-conscious and trade-down consumers
- ▸Follows recent earnings beat driven by successful promotional traffic
McDonald's to launch $3 value meal to maintain market share in competitive environment
- ▸McDonald's introducing $3 meal to compete in value-focused fast food market
- ▸Follows previous $5 meal promotion launched earlier in 2024
- ▸Most recent quarterly revenue $7B, +10% YoY
- ▸Most recent quarterly net income $2.2B, +7% YoY
- ▸Franchise model provides high margins to support aggressive pricing strategy