Comparable Sales dip slightly as McDonald’s faces softer U.S. demand in Q1

Overview

McDonald’s began 2025 navigating a more cautious consumer environment and lapping an unusually strong Q1 2024 that included Leap Day. While global comparable sales were slightly down, underlying demand remained stable in key international markets, and loyalty engagement remained strong.

CEO Chris Kempczinski stated: “McDonald’s has a 70-year legacy of innovation, leadership, and proven agility, all of which give us confidence in our ability to navigate even the toughest of market conditions and gain market share. Consumers today are grappling with uncertainty, but they can always count on McDonald’s for both exciting new menu items and delicious favorites for exceptional value, from a brand they love.”

Q1 2025 vs. Q1 2024:

• Global Comparable sales declined -1% YoY, but essentially flat when adjusted for Leap Day in 2024. Loyalty sales reached $8bn in Q1 2025 and $31bn on a trailing twelve-month basis.
  • U.S. Comparable sales were -3.6% YoY, driven by lower guest counts and consumer pressure on discretionary spending.
  • International Operated Markets also decreased -1% YoY, with the U.K. underperforming while other markets held steady.
  • International Developmental Licensed Markets grew +3.5% YoY, a positive momentum led by strong performance in the Middle East and Japan.
• Revenues declined to $5.96bn (-3% YoY), impacted by lower company-operated sales and FX headwinds.
  • Revenues from franchised restaurants were $3.66bn (-2% YoY), while Sales by Company-owned and operated restaurants were $2.13bn (-9% YoY).
• Operating income also decreased to $2.65bn (-3% YoY), but flat excluding charges and FX, which including $66m in pre-tax restructuring charges tied to the “Accelerating the Organization” program.
• Total operating costs and expenses decreased to $3.31bn (-4% YoY), supporting profitability amid flat sales.
• Net income recorded a value of $1.87bn (-3% YoY).
• Diluted EPS was $2.60 (-2% YoY), while adjusted EPS was $2.67 (-1% YoY and +1% in constant currencies) after excluding restructuring impacts.
• The company returned ~$1.1bn to shareholders through dividends and share repurchases.

While McDonald’s did not provide formal financial guidance, management reaffirmed its long-term focus on maintaining guest value, driving digital and loyalty engagement, and modernizing restaurant operations. The company remains cautious amid macro uncertainty and weaker U.S. traffic trends but is confident in its ability to navigate the environment through brand strength, innovation, and operational efficiency.

The quarterly results below analysts’ expectations were taxed by investors, with MCD’s share price decreasing by almost -2% after the market opened on May 1. However, since the beginning of this year, the stock price has managed to appreciate by over +7%, a pleasant surprise considering the global uncertainties caused by the imposition of trade tariffs, given that investors seem to have taken refuge by buying shares of this company, to the detriment of others that were intensely affected by President Donald Trump’s announcements.

Author: Ionuț-Adrian Lazar