McDonald's Strong Q2 Results Lift Stock Amid Rising Demand

McDonald's Reports Strong Second-Quarter 2025 Performance

McDonald’s Corporation (MCD) has released its second-quarter 2025 financial results, which exceeded expectations on both the earnings and revenue fronts. The company saw significant growth in both its top and bottom lines compared to the same period last year.

Following the release of these results, McDonald’s shares experienced a notable increase of 3.5% in pre-market trading. This positive movement reflects investor confidence in the company’s performance, which was driven by several factors including an increase in comparable guest counts.

Key Drivers of McDonald's Success

The strong performance of McDonald’s can be attributed to a combination of effective value offerings, impactful marketing strategies, and continuous menu innovation that resonated with customers around the globe. Additionally, the company’s investments in technology and digital expansion have significantly enhanced customer convenience and engagement across various channels.

Earnings and Revenue Breakdown

In the second quarter of 2025, McDonald’s reported adjusted earnings per share (EPS) of $3.19, surpassing the Zacks Consensus Estimate of $3.15. This represents a 7.4% year-over-year increase.

The company also reported quarterly net revenues of $6,843 million, which exceeded the consensus estimate of $6,714 million. This marks a 5% rise in revenue compared to the same period in 2024.

At company-operated restaurants, sales remained flat at $2.5 billion year over year. However, sales at franchise-operated restaurants increased by 7% to $4.2 billion. Other revenues saw a remarkable surge of 92% year over year, reaching $172 million. Our model had predicted a modest increase of 1.2% and 2.5% for company-operated and franchise-operated restaurant sales, respectively.

Global Sales Performance

McDonald’s global comparable sales (comps) rose by 3.8% in the second quarter, outperforming the 1% decline recorded in the prior-year quarter. Our estimated growth for this period was 2.4%.

United States Segment

In the U.S., segmental comps increased by 2.5%, compared to a 0.7% decline in the previous year. Positive check growth contributed to the improvement in comparable sales. Our model had anticipated a 2.4% increase for the U.S. segment.

International Operated Markets

Segmental comps in international operated markets jumped by 4%, against a 1.1% decline in the year-ago quarter. This growth was fueled by positive comparable sales across all regions. We had expected a 2% increase from the previous year.

International Developmental Licensed Segment

In the international developmental licensed segment, comparable sales rose by 5.6%, compared to a 1.3% decline in the prior-year quarter. Japan led the charge, with all global regions reporting increases.

Operating Highlights and Expenses

McDonald’s total operating costs and expenses for the second quarter amounted to $3.6 billion, reflecting a 1% year-over-year increase. Despite this, operating income rose by 11% to $3.2 billion. Net income reached $2.3 billion, up 11% compared to the same period last year.

Zacks Rank and Industry Comparisons

McDonald’s currently holds a Zacks Rank of #3 (Hold). In comparison, other stocks within the Zacks Retail – Restaurants industry have better rankings. These include:

• BJ's Restaurants, Inc. (BJRI): Carries a Zacks Rank of #1 (Strong Buy). The stock has gained 20.1% over the past year. The Zacks Consensus Estimate forecasts a 3.6% increase in sales and a 130.8% rise in EPS for 2025 compared to the previous year.

• Yum! Brands, Inc. (YUM): Holds a Zacks Rank of #2 (Buy). The stock has gained 4% year-to-date. The Zacks Consensus Estimate predicts a 6.9% increase in sales and a 9.5% rise in EPS for 2025.

• The Cheesecake Factory Incorporated (CAKE): Maintains a Zacks Rank of #2. The stock has increased by 15.6% over the past six months. The Zacks Consensus Estimate suggests a 5.5% growth in sales and a 1.7% increase in EPS for 2025.

These comparisons highlight the competitive landscape within the restaurant industry and the varying performance of key players.