Franchisee financial health and cooperation
A heavily franchised model depends on operators investing in and running restaurants effectively.
- Scope
- Royalties, rent and systemwide sales
- Materiality
- high
McDonald's Corporation
McDonald's Corp. operates a global restaurant system built around franchised and company-operated McDonald's locations serving burgers, chicken, breakfast, beverages and desserts. The company earns revenue mainly from franchise rent and royalties, plus sales from company-operated restaurants, while using digital, delivery and drive-thru to drive guest traffic and systemwide sales.
47,8 %
31,9 %
+3,7 %
0.95
0.94
| % | |
|---|---|
| Franchise fees and rent | 65% Royalties, rent and other fees from franchised restaurants and licensees. |
| Company-operated restaurant sales | 25% Food and beverage sales from restaurants the company directly operates. |
| Digital and loyalty ecosystem | 5% Mobile app, loyalty, personalized offers and related customer engagement tools. |
| Delivery and channel partnerships | 3% Delivery-enabled sales and partnerships with delivery providers. |
| Other restaurant and development income | 2% Initial fees, development-related income and other ancillary restaurant revenue. |
McDonald's serves end consumers who buy meals for convenience, value and familiarity, with demand spanning breakfast,...
- Everyday quick-service consumersprimary
Buy burgers, chicken, fries, breakfast and beverages for convenience, value and familiarity.
- Digital and loyalty customersprimary
Use the app, offers and rewards to order more frequently and engage with the brand.
- Delivery userssecondary
Order from home or work through app and third-party delivery channels for convenience.
- Franchisees and developmental licenseesprimary
Operate restaurants under McDonald's system and pay rent, royalties and fees.
- International market consumerssecondary
Buy locally adapted menus in more than 100 countries, supporting global scale.
McDonald's operates in more than 100 countries, with reporting focused on the U.S., International Operated Markets, and...
- •Operations span more than 100 countries and over 44,000 restaurants
- •U.S. is a major profit pool and a key comparable-sales market
- •International Operated Markets drive company-operated and franchised growth
- •Developmental Licensed Markets are exposed to royalties and geopolitical disruption
- •Foreign exchange affects reported results, especially euro-linked markets
McDonald's strategy centers on the “4D’s”: digital, delivery, drive-thru and restaurant development, supported by menu...
01
Grow digital and loyalty engagementmedium-term
Higher engagement can increase visit frequency, personalization and systemwide sales.
02
Scale delivery and mobile orderingmedium-term
Delivery expands occasions and app ordering improves convenience and data capture.
03
Protect and refresh the core menushort-term
Iconic products drive traffic, while menu innovation keeps the brand relevant.
04
Accelerate restaurant development and drive-thru executionmedium-term
New openings and faster service support guest counts and market share.
05
Modernize the operating platformmedium-term
Technology and GBS are intended to improve speed, efficiency and decision-making.
McDonald's is exposed to franchisee health, consumer spending shifts, foreign exchange and geopolitical disruption...
Middle East geopolitical disruption
The company said the war in the Middle East has negatively impacted sales in developmental licensed markets.
- Scope
- International Developmental Licensed Markets
- Materiality
- high
Consumer spending weakness
Quick-service demand is sensitive to value perception and discretionary spending.
- Scope
- Comparable sales and guest counts
- Materiality
- high
Foreign currency translation
A large international footprint means reported results move with exchange rates.
- Scope
- Euro, Australian dollar, Canadian dollar and other currencies
- Materiality
- medium
Execution risk in digital and delivery
The strategy relies on app adoption, loyalty engagement and delivery mix improvement.
- Scope
- Technology rollout and partner integration
- Materiality
- medium
Revenue mix and recognition
Mix shifts can change reported growth even when systemwide sales are stable
Foreign currency translation
Constant-currency results may differ materially from reported results
Impairment and restructuring charges
Can reduce operating income and obscure underlying trends
Asset write-offs and store closing costs
Affects other operating expense and operating margin
Lease and franchise-related obligations
Can influence balance sheet leverage and expense timing
: 11/08/2026