McDONALD'S REPORTS FOURTH QUARTER AND FULL YEAR 2024 RESULTS

Rhea-AI Summary

McDonald's reported its Q4 and full-year 2024 financial results. Global systemwide sales exceeded $130 billion for the full year, with growth of over $1 billion. Loyalty program sales reached approximately $30 billion for the full year, showing 30% growth, with 90-day active users exceeding 175 million across 60 markets.

Q4 2024 highlights include: global comparable sales up 0.4%, with U.S. declining 1.4%, International Operated Markets up 0.1%, and International Developmental Licensed Markets up 4.1%. Q4 diluted EPS remained flat at $2.80.

Full-year 2024 performance showed: global comparable sales decrease of 0.1%, consolidated revenues up 2%, and diluted EPS of $11.39, down 1%. The company faced $221 million in restructuring charges and $70 million in transaction costs and impairment charges during the year.

Positive

• Global systemwide sales exceeded $130 billion with $1+ billion growth
• Loyalty program sales grew 30% to $30 billion annually
• Loyalty user base increased 15% to 175 million active users
• International Developmental Licensed Markets showed 4.1% growth in Q4
• Consolidated revenues increased 2% for full year 2024

Negative

• U.S. comparable sales declined 1.4% in Q4 2024
• Global comparable sales decreased 0.1% for full year 2024
• Diluted EPS decreased 1% to $11.39 for full year
• Incurred $221M in restructuring charges
• Operating income was flat when excluding charges

Insights

Financial Analyst

McDonald's Q4 and FY2024 results present a complex picture of a company navigating significant market challenges while maintaining its strategic focus. The flat Q4 revenue and modest 2% increase in systemwide sales indicate resilience, but also point to emerging headwinds.

A particularly noteworthy bright spot is the company's digital transformation success, evidenced by the 30% year-over-year growth in loyalty program sales to $30 billion, with 175 million active users across 60 markets. This digital engagement is important for future growth and customer retention, providing valuable data for personalization and menu optimization.

However, the 1.4% decline in U.S. comparable sales during Q4, coupled with declining average check values, signals potential challenges in McDonald's largest market. This decline, partially offset by slightly positive guest counts, suggests pricing pressures and changing consumer behaviors in response to economic conditions.

The international performance shows interesting divergence:

• International Operated Markets showed marginal 0.1% growth
• International Developmental Licensed Markets demonstrated robust 4.1% growth, led by Middle East and Japan
• The UK market's underperformance offset positive results in other regions

The company's ongoing restructuring efforts, resulting in $221 million in charges for the full year, reflect a strategic organizational transformation. While these charges impact short-term profitability, they represent necessary investments in operational efficiency and market adaptability.

Looking ahead, McDonald's faces the challenge of balancing pricing power with value perception while navigating varying international market conditions. The strong loyalty program performance provides a solid foundation for targeted marketing and personalized offerings, which could help address market-specific challenges.

• Global Systemwide sales* were over $130 billion for the full year, with full year growth of more than $1 billion (more than $2 billion in constant currencies)
• Systemwide sales to loyalty members were approximately $30 billion for the full year and approximately $8 billion for the quarter across 60 loyalty markets, with full year growth of 30% over prior year
• 90-day active loyalty users were over 175 million across 60 loyalty markets as of year-end, with growth of approximately 15% over prior year

CHICAGO, Feb. 10, 2025 /PRNewswire/ -- McDonald's Corporation today announced results for the fourth quarter and year ended December 31, 2024.

"Accelerating the Arches continues to be the right strategy as we focus on growing market share," said Chairman and CEO Chris Kempczinski. "We're playing to win, focusing on our customers with outstanding value, exciting menu innovation and culturally relevant marketing." 

Fourth quarter financial performance:

• Global comparable sales increased 0.4%:
  • U.S. decreased 1.4%
  • International Operated Markets segment increased 0.1%
  • International Developmental Licensed Markets segment increased 4.1%
• Consolidated revenues were flat (flat in constant currencies).
• Systemwide sales increased 2% (2% in constant currencies).
• Consolidated operating income increased 2% (3% in constant currencies). Excluding $3 million of current year net charges, as well as prior year pre-tax charges of $138 million, consolidated operating income decreased 2% (2% in constant currencies).**
• Diluted earnings per share was flat at $2.80 (increased 1% in constant currencies). Excluding the current year net charges described above of $0.03 per share, diluted earnings per share was $2.83, a decrease of 4% (4% in constant currencies) when also excluding prior year charges.**

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Full year financial performance:

• Global comparable sales decreased 0.1%:
  • U.S. increased 0.2%
  • International Operated Markets segment decreased 0.2%
  • International Developmental Licensed Markets segment decreased 0.3%
• Consolidated revenues increased 2% (2% in constant currencies).
• Systemwide sales increased 1% (2% in constant currencies).
• Consolidated operating income increased 1% (1% in constant currencies). Results included $221 million of pre-tax restructuring charges associated with Accelerating the Organization and $70 million of pre-tax transaction costs and non-cash impairment charges, net of gains on associated property sales. Excluding these current year net charges, as well as prior year pre-tax charges of $362 million, consolidated operating income was flat (flat in constant currencies).**
• Diluted earnings per share was $11.39, a decrease of 1% (1% in constant currencies). Excluding the current year net charges described above of $0.33 per share, diluted earnings per share was $11.72, a decrease of 2% (1% in constant currencies) when also excluding prior year charges.**

*Refer to page 5 for a definition of Systemwide sales.

**Refer to pages 3 and 4 for additional details on our results for the fourth quarter and full year 2024 and 2023.

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COMPARABLE SALES

		Increase/(Decrease)
		Quarters Ended December 31,
		2024		2023
U.S.		(1.4) %		4.3 %
International Operated Markets		0.1		4.4
International Developmental Licensed Markets		4.1		0.7
Total Company		0.4 %		3.4 %

 

• U.S.: Comparable sales results for the quarter reflect a decline in average check, partly offset by slightly positive comparable guest counts.
• International Operated Markets: Slightly positive segment performance was driven by mixed results across the markets. Results reflected positive comparable sales in most markets, partly offset by negative comparable sales in some markets, led by the U.K.
• International Developmental Licensed Markets: Segment performance reflected positive comparable sales, led by the Middle East and Japan.

KEY FINANCIAL METRICS - CONSOLIDATED
Dollars in millions, except per share data

	Quarters Ended December 31,								Years Ended December 31,
	2024		2023		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation		2024		2023		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
Revenues	$     6,388		$     6,406		— %		— %		$    25,920		$    25,494		2 %		2 %
Operating income	2,868		2,802		2		3		11,712		11,647		1		1
Net income	2,017		2,039		(1)		—		8,223		8,469		(3)		(2)
Earnings per share-diluted	$       2.80		$       2.80		— %		1 %		$      11.39		$      11.56		(1) %		(1) %

Results for 2024 included the following:

• Pre-tax charges of $74 million, or $0.10 per share, for the quarter and $221 million, or $0.25 per share, for the year, primarily related to restructuring charges associated with the Company's internal effort to modernize ways of working (Accelerating the Organization)
• Net pre-tax gains of $71 million, or $0.07 per share, for the quarter and net pre-tax charges of $70 million, or $0.08 per share, for the year, primarily consisted of property sale gains, transaction costs and non-cash impairment charges associated with the sale of McDonald's business in South Korea and transaction costs associated with the acquisition of McDonald's business in Israel

Results for 2023 included the following:

• Pre-tax charges of $72 million, or $0.08 per share, for the quarter and the year, related to the write-off of impaired software no longer in use
• Pre-tax charges of $66 million, or $0.07 per share, for the quarter and $290 million, or $0.30 per share, for the year, related to the Company's Accelerating the Arches growth strategy, including restructuring charges associated with Accelerating the Organization

Excluding the above items, operating income performance for both periods was primarily driven by lower Other operating income and lower Company-owned and operated margins, partly offset by higher sales-driven Franchised margins. Results for both periods reflected higher interest expense, lower non-operating income and a higher effective tax rate.

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NET INCOME AND EARNINGS PER SHARE-DILUTED RECONCILIATION 
Dollars in millions, except per share data

	Quarters Ended December 31,
	Net Income								Earnings per share - diluted
	2024		2023		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation		2024		2023		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
GAAP	$   2,017		$   2,039		(1) %		— %		$      2.80		$      2.80		— %		1 %
(Gains)/Charges	18		106						0.03		0.15
Non-GAAP	$   2,035		$   2,145		(5) %		(5) %		$      2.83		$      2.95		(4) %		(4) %
	Years Ended December 31,
	Net Income								Earnings per share - diluted
	2024		2023		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation		2024		2023		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
GAAP	$   8,223		$   8,469		(3) %		(2) %		$   11.39		$   11.56		(1) %		(1) %
(Gains)/Charges	236		274						0.33		0.38
Non-GAAP	$   8,459		$   8,742		(3) %		(3) %		$   11.72		$   11.94		(2) %		(1) %

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THE FOLLOWING DEFINITIONS APPLY TO THESE TERMS AS USED THROUGHOUT THIS RELEASE

Constant currency results exclude the effects of foreign currency translation and are calculated by translating current year results at prior year average exchange rates. Management reviews and analyzes business results excluding the effect of foreign currency translation, impairment and other charges and gains, as well as material regulatory and other income tax impacts, and bases incentive compensation plans on these results because the Company believes this better represents underlying business trends.

Comparable sales and comparable guest counts are compared to the same period in the prior year and represent sales and transactions, respectively, at all restaurants, whether owned and operated by the Company or by franchisees, in operation at least thirteen months including those temporarily closed. Some of the reasons restaurants may be temporarily closed include reimaging or remodeling, rebuilding, road construction, natural disasters, pandemics or acts of war, terrorism or other hostilities. Comparable sales exclude the impact of currency translation and the sales of any market considered hyperinflationary (generally identified as those markets whose cumulative inflation rate over a three-year period exceeds 100%), which management believes more accurately reflects the underlying business trends. Comparable sales are driven by changes in guest counts and average check, the latter of which is affected by changes in pricing and product mix.

Systemwide sales include sales at all restaurants, whether owned and operated by the Company or by franchisees. Systemwide sales to loyalty members is comprised of all sales to customers who self-identify as a loyalty member when transacting with both Company-owned and operated and franchised restaurants. Systemwide sales to loyalty members are measured across 60 markets with loyalty programs. Systemwide sales to loyalty members represents an aggregation of the prior four quarters of sales to loyalty members active in the last 90 days of the respective quarter. While franchised sales are not recorded as revenues by the Company, management believes the information is important in understanding the Company's financial performance because these sales are the basis on which the Company calculates and records franchised revenues and are indicative of the financial health of the franchisee base. The Company's revenues consist of sales by Company-owned and operated restaurants and fees from franchised restaurants operated by conventional franchisees, developmental licensees and affiliates. Changes in Systemwide sales are primarily driven by comparable sales and net restaurant unit expansion. 

Free cash flow, defined as cash provided by operations less capital expenditures, and free cash flow conversion rate, defined as free cash flow divided by net income, are measures reviewed by management in order to evaluate the Company's ability to convert net profits into cash resources, after reinvesting in the core business, that can be used to pursue opportunities to enhance shareholder value.

RELATED COMMUNICATIONS

This press release should be read in conjunction with Exhibit 99.2 to the Company's Form 8-K filing for supplemental information related to the Company's results for the quarter and year ended December 31, 2024.

McDonald's Corporation will broadcast its investor earnings conference call live over the Internet at 7:30 a.m. (Central Time) on February 10, 2025. A link to the live webcast will be available at www.investor.mcdonalds.com. There will also be an archived webcast available for a limited time thereafter.

UPCOMING COMMUNICATIONS

For important news and information regarding McDonald's, including the timing of future investor conferences and earnings calls, visit the Investor Relations section of the Company's Internet home page at www.investor.mcdonalds.com. McDonald's uses this website as a primary channel for disclosing key information to its investors, some of which may contain material and previously non-public information.

ABOUT McDONALD'S

McDonald's is the world's leading global foodservice retailer with over 43,000 locations in over 100 countries. Approximately 95% of McDonald's restaurants worldwide are owned and operated by independent local business owners.

FORWARD-LOOKING STATEMENTS

This release contains certain forward-looking statements, which reflect management's expectations regarding future events and operating performance and speak only as of the date hereof. These forward-looking statements involve a number of risks and uncertainties. Factors that could cause actual results to differ materially from expectations are detailed in the Company's filings with the Securities and Exchange Commission, including the risk factors discussed in Exhibit 99.2 to the Company's Form 8-K filing on February 10, 2025. The Company undertakes no obligation to update such forward-looking statements, except as may otherwise be required by law.

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McDONALD'S CORPORATION CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
Dollars and shares in millions, except per share data
Quarters Ended December 31,	2024		2023		Inc/ (Dec)
Revenues
Revenues from franchised restaurants	$        3,958		$        3,869		$              90		2 %
Sales by Company-owned and operated restaurants	2,310		2,474		(164)		(7)
Other revenues	120		63		56		88
TOTAL REVENUES	6,388		6,406		(19)		—
Operating costs and expenses
Franchised restaurants-occupancy expenses	635		633		2		—
Company-owned and operated restaurant expenses	1,977		2,075		(98)		(5)
Other restaurant expenses	98		45		54		n/m
Selling, general & administrative expenses
Depreciation and amortization	136		91		45		50
Other	664		731		(67)		(9)
Other operating (income) expense, net	10		31		(21)		(66)
Total operating costs and expenses	3,519		3,604		(85)		(2)
OPERATING INCOME	2,868		2,802		66		2
Interest expense	380		360		20		6
Nonoperating (income) expense, net	(49)		(73)		24		(33)
Income before provision for income taxes	2,537		2,515		22		1
Provision for income taxes	521		476		45		9
NET INCOME	$        2,017		$        2,039		$            (22)		(1) %
EARNINGS PER SHARE-DILUTED	$          2.80		$          2.80		$             —		— %
Weighted average shares outstanding-diluted	719.7		727.8		(8.1)		(1) %
n/m Not meaningful

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McDONALD'S CORPORATION CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
Dollars and shares in millions, except per share data
Years Ended December 31,	2024		2023		Inc/ (Dec)
Revenues
Revenues from franchised restaurants	$      15,715		$      15,437		$            278		2 %
Sales by Company-owned and operated restaurants	9,782		9,742		40		—
Other revenues	423		316		108		34
TOTAL REVENUES	25,920		25,494		426		2
Operating costs and expenses
Franchised restaurants-occupancy expenses	2,536		2,475		62		2
Company-owned and operated restaurant expenses	8,334		8,224		110		1
Other restaurant expenses	339		232		107		46
Selling, general & administrative expenses
Depreciation and amortization	447		382		65		17
Other	2,412		2,435		(24)		(1)
Other operating (income) expense, net	139		99		41		41
Total operating costs and expenses	14,208		13,847		361		3
OPERATING INCOME	11,712		11,647		65		1
Interest expense	1,506		1,361		146		11
Nonoperating (income) expense, net	(139)		(236)		97		(41)
Income before provision for income taxes	10,345		10,522		(178)		(2)
Provision for income taxes	2,121		2,053		68		3
NET INCOME	$        8,223		$        8,469		$          (245)		(3) %
EARNINGS PER SHARE-DILUTED	$        11.39		$        11.56		$         (0.17)		(1) %
Weighted average shares outstanding-diluted	721.9		732.3		(10.4)		(1) %
n/m Not meaningful

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McDONALD'S CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
In millions	December 31,	2024		2023
Current assets
Cash and equivalents		$        1,085		$        4,579
Accounts and notes receivable		2,383		2,488
Other current assets		1,130		919
TOTAL CURRENT ASSETS		4,599		7,986
TOTAL OTHER ASSETS		11,950		9,738
LEASE RIGHT-OF-USE ASSET, NET		13,339		13,514
NET PROPERTY AND EQUIPMENT		25,295		24,908
TOTAL ASSETS		$      55,182		$      56,147
TOTAL CURRENT LIABILITIES		$        3,861		$        6,859
Long-term debt		38,424		37,153
Long-term lease liability		12,888		13,058
Other long-term liabilities		1,893		2,103
Deferred income taxes		1,914		1,681
TOTAL SHAREHOLDERS' EQUITY (DEFICIT)		(3,797)		(4,707)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)		$      55,182		$      56,147

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McDONALD'S CORPORATION CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
In millions	Years ended December 31,	2024	2023
Operating activities
Net income		$      8,223	$      8,469
Changes in working capital items		(437)	(108)
Other		1,660	1,251
CASH PROVIDED BY OPERATIONS		9,447	9,612
Investing activities
Capital expenditures		(2,775)	(2,357)
Sales and purchases of restaurant and other businesses and property sales		(2,073)	(151)
Other		(498)	(676)
CASH USED FOR INVESTING ACTIVITIES		(5,346)	(3,185)
Financing activities
Net short-term borrowings and long-term financing issuances and payments		(72)	2,993
Treasury stock purchases		(2,824)	(3,054)
Common stock dividends		(4,870)	(4,533)
Proceeds from stock option exercises and other		271	220
CASH USED FOR FINANCING ACTIVITIES		(7,495)	(4,374)
EFFECT OF EXCHANGE RATES ON CASH AND EQUIVALENTS		(101)	(58)
CASH AND EQUIVALENTS INCREASE (DECREASE)		(3,494)	1,996
Cash and equivalents at beginning of year		4,579	2,584
CASH AND EQUIVALENTS AT END OF YEAR		$      1,085	$      4,579
Supplemental cash flow disclosures
Cash provided by operations		$      9,447	$      9,612
Less: Capital expenditures		(2,775)	(2,357)
FREE CASH FLOW		$      6,672	$      7,255

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SOURCE McDonald's Corporation

FAQ

What was McDonald's (MCD) revenue growth in Q4 2024?

McDonald's revenues were flat in Q4 2024 compared to the same period last year, both in reported and constant currency terms.

How much did McDonald's (MCD) loyalty program grow in 2024?

McDonald's loyalty program sales grew 30% year-over-year, reaching approximately $30 billion for the full year 2024, with active users growing 15% to over 175 million.

What was McDonald's (MCD) EPS for full year 2024?

McDonald's reported diluted earnings per share of $11.39 for full year 2024, representing a 1% decrease from the previous year.

How did McDonald's (MCD) U.S. market perform in Q4 2024?

McDonald's U.S. market experienced a 1.4% decrease in comparable sales during Q4 2024, reflecting a decline in average check partially offset by slightly positive comparable guest counts.

What were McDonald's (MCD) global systemwide sales in 2024?

McDonald's global systemwide sales exceeded $130 billion for the full year 2024, with growth of more than $1 billion (more than $2 billion in constant currencies).