McDonald's
McDonald's revenue rose 3.7% to $26.9 billion in fiscal 2025. Its operating margin was 46.1%, up from 45.2% a year earlier. Free cash flow was $7.2 billion, up 7.7%. It paid out $7.2 billion in dividends and buybacks, 100% of free cash flow. The diluted share count fell 0.8%.
Operating margin is operating income as a share of revenue. Free cash flow is cash from operations minus capital spending. Return on capital is after-tax operating income as a share of the money invested in the business: debt plus equity, minus cash. Market cap is the last closing share price times the latest diluted share count, so it is approximate. P/E is the last close divided by diluted earnings per share over the last four quarters, or the latest fiscal year where the quarters aren't available; there is none when the company made a loss.
What McDonald's does
McDonald's runs a chain of fast-food restaurants in more than 100 countries, selling burgers, fries, chicken and drinks for eating in, at the drive-thru, or through delivery and its mobile app. Of its 45,356 restaurants at the end of 2025, about 95% were run by franchisees, independent owners who operate the restaurants themselves.
McDonald's makes most of its money from those franchisees rather than from selling food directly. In a standard franchise, the company usually owns or leases the land and building, and the franchisee pays rent and royalties based on a share of sales. In other markets, mainly China and Japan, local partners put up the money and pay royalties. The company also earns sales from the restaurants it runs itself. It reports results for the United States, its large international markets such as Germany and Australia, and a group of more than 75 countries run mostly by licensees. McDonald's says it competes with other fast-food chains and with a wide range of places to eat out, including delivery services, convenience stores and coffee shops.
The company employed over 150,000 people at the end of 2025, about 70% of them outside the United States, and over two million more people work in its franchised restaurants. It offers delivery from about 90% of its restaurants.
Its biggest risks, as it describes them
- Failing to keep its brand appealing or to keep up with changing customer tastes and its pricing and marketing plans.
- Its reliance on franchisees, whose performance and relationship with the company shape its results.
- Food safety problems that could hurt customer trust in its restaurants.
- Rising labor costs and difficulty finding enough restaurant workers.
- Supply chain disruptions and rising food and other costs.
Charts show fiscal years, from the 10-K filings.
Revenue and margins
Net income and earnings per share
From fiscal 2016 to 2025, earnings per share grew 9.1% a year and net income 6.9% a year, as buybacks cut the share count by 17%.
Returns on capital
Cash flow
Payouts and share count
Valuation
Two ways to value McDonald's yourself, both starting from its filings: a discounted cash flow model and the price-to-earnings method.
Discounted cash flow (DCF)
A discounted cash flow (DCF) model values a business as the cash it may generate in future, discounted back to today. The starting figures come from McDonald's 10-K (or, for net cash and shares, its latest 10-Q) and the assumptions are yours: start from one of three example scenarios, then change any figure to see what it implies for a share, and how that compares with the last share price.
Value per share on three example scenarios, from McDonald's cash from operations minus depreciation in fiscal 2025 (free cash flow before spending to grow: capital spending was 7.4 times depreciation, which holds its free cash flow down) of $10.1B, net cash of −$42.3B at December 31, 2025 and 716 million diluted shares, from its filings. The scenarios are fitted to McDonald's: the base scenario's growth in years 1 to 5 is its revenue growth over the last 3 years, 5.1% a year; the cautious and optimistic ones are lower and higher, and growth in years 6 to 10 is halfway to the long-run rate. The base scenario's discount rate is 9% for a business of moderate risk (Restaurants); the cautious and optimistic ones use a point more and a point less. Select one to load it into the calculator. These are the model's arithmetic on those assumptions, not a forecast or a price target.
- Last close, October 26, 2026
- $250.83
- Value on these assumptions, against the last close
- —
- Cash flows in years 1 to 10, valued today
- —
- Everything after year 10, valued today
- —
- Plus net cash
- —
- Share of value from after year 10
How the value changes with two assumptions
Price-to-earnings (P/E) method
Another common way to value a company is to multiply its earnings per share by a price-to-earnings (P/E) multiple: the number of years of today's earnings an investor pays for a share. A higher multiple usually means investors expect earnings to grow. Choose a multiple, for example from similar companies, to see the value it gives.
Value per share on three example scenarios, from McDonald's earnings per share of $12.31 (over the last four quarters). Each grows earnings for a year at the cash flow scenarios' rates and applies a multiple to next year's earnings: 20.4×, the middle of McDonald's own P/E today, its peers' median and its sector's median (McDonald's own P/E today) for the base scenario, 20% less and more for the cautious and optimistic ones. The price is brought back a year at 10%, 9% and 8%. Select one to load it into the calculator. These are the model's arithmetic on those assumptions, not a forecast or a price target.
- Last close, October 26, 2026
- $250.83
- Value at this multiple, against the last close
- —
- McDonald's P/E at the last close
- 20.4×
| Company | Last close | Earnings per share | P/E today |
|---|---|---|---|
| StarbucksSBUX | $102.69 | $1.74 | 59.0× |
| Chipotle Mexican GrillCMG | $28.41 | $1.09 | 26.1× |
| Darden RestaurantsDRI | $213.25 | $10.23 | 20.8× |
| McDonald'sMCD | $250.83 | $12.31 | 20.4× |
| Yum ChinaYUMC | $45.53 | $2.73 | 16.7× |
Balance sheet
| Fiscal year end | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Cash and short-term investments | 4.7 | 2.6 | 4.6 | 1.1 | 0.8 |
| Debt incl. finance leases | 35.6 | 35.9 | 41.3 | 41.0 | 43.1 |
| Net debt (negative means net cash) | 30.9 | 33.3 | 36.7 | 39.9 | 42.3 |
| Net debt to EBITDA | 2.9x | 3.4x | 3.0x | 3.3x | 3.3x |
| Debt to equity | — | — | — | — | — |
| Interest coverage | 8.7x | 7.8x | 8.6x | 7.8x | 7.8x |
| Current ratio | 1.8x | 1.4x | 1.2x | 1.2x | 0.9x |
| Quick ratio | 1.8x | 1.4x | 1.2x | 1.2x | 0.9x |
Insider trades
Over the 12 months between October 27, 2025 and October 26, 2026, no insider bought McDonald's shares on the open market, and 8 insiders sold $40.5 million, $37.5 million of it under trading plans set up in advance.
| Date | Insider | Trade | Shares | Price | Value | Filing |
|---|---|---|---|---|---|---|
| Jun 10, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 5,252 | $284.32 | $1.5 million | Form 4 |
| May 28, 2026 | Desiree Ralls-MorrisonEVP, Chief Legal Officer | Sold plan | 2,763 | $278.36 | $769,109 | Form 4 |
| May 26, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 333 | $280.11 | $93,277 | Form 4 |
| Apr 23, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 333 | $302.72 | $100,806 | Form 4 |
| Apr 10, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 2,626 | $307.00 | $806,182 | Form 4 |
| Mar 23, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 333 | $313.47 | $104,386 | Form 4 |
| Mar 18, 2026 | Dario BaroniPresident, Idl | Sold plan | 600 | $323.77 | $194,262 | Form 4 |
| Mar 10, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 2,626 | $328.34 | $862,221 | Form 4 |
| Feb 23, 2026 | Jonathan BannerEVP - Chief Impact Officer | Sold | 6,201 | $333.29 | $2.1 million | Form 4 |
| Feb 23, 2026 | Joseph M. ErlingerPresident, McDonald's USA | Sold plan | 333 | $330.43 | $110,033 | Form 4 |
| Feb 13, 2026 | Christopher J KempczinskiChairman and CEO, Director | Sold plan | 26,276 | $333.54 | $8.8 million | Form 4 |
| Feb 12, 2026 | Christopher J KempczinskiChairman and CEO, Director | Sold plan | 26,277 | $331.35 | $8.7 million | Form 4 |
Piotroski F-score
The F-score counts how many of nine simple tests of profitability, funding and efficiency a company passed in a year (Piotroski, 2000). The more tests passed, the stronger the year: 8 or 9 is strong, 0 to 2 weak. Companies that report no gross profit are scored on the other eight.
| Test | FY23 | FY24 | FY25 |
|---|---|---|---|
| Net income is positive | Pass | Pass | Pass |
| Cash from operations is positive | Pass | Pass | Pass |
| Return on assets rose | Pass | Fail | Pass |
| Cash from operations exceeds net income | Pass | Pass | Pass |
| Debt fell relative to assets | Fail | Pass | Fail |
| Current ratio rose | Fail | Pass | Fail |
| Share count didn't rise | Pass | Pass | Pass |
| Gross margin rose | — | — | — |
| Revenue rose relative to assets | Pass | Fail | Pass |
| F-score | 6 of 8 | 6 of 8 | 6 of 8 |
| Accruals ratio | −2.1% | −2.2% | −3.5% |
Compare
Put McDonald's side by side with any other company we cover: revenue, growth, margins, cash flow and returns, with ten years of charts.
Similar companies
| Company | Year | Revenue growth | Operating margin | Free cash flow margin | Return on capital | Net debt to EBITDA | F-score | Compare |
|---|---|---|---|---|---|---|---|---|
| McDonald's | FY25 | 3.7% | 46.1% | 26.7% | 25.4% | 3.3x | 6 | |
| Starbucks | FY25 | 2.8% | 7.9% | 6.6% | 47.8% | 2.7x | 4 | Compare |
| Darden Restaurants | FY26 | 9.4% | 12.0% | 8.5% | 24.8% | 1.5x | 6 | Compare |
| Chipotle Mexican Grill | FY25 | 5.4% | 16.2% | 12.1% | 73.7% | −0.5x | 4 | Compare |
| Yum China | FY25 | 4.4% | 10.9% | 7.1% | — | — | — | Compare |
10 years of figures
| Fiscal year | FY16 | FY17 | FY18 | FY19 | FY20 | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|---|---|---|---|---|
| Income statement | ||||||||||
| Revenue | 24.6 | 22.8 | 21.3 | 21.4 | 19.2 | 23.2 | 23.2 | 25.5 | 25.9 | 26.9 |
| Revenue growth | −3.1% | −7.3% | −6.8% | 0.5% | −10.1% | 20.9% | −0.2% | 10.0% | 1.7% | 3.7% |
| Gross profit | — | — | — | — | — | — | — | — | — | — |
| Research and development | — | — | — | — | — | — | — | — | — | — |
| Operating income | 7.7 | 9.6 | 8.8 | 9.1 | 7.3 | 10.4 | 9.4 | 11.6 | 11.7 | 12.4 |
| Net income | 4.7 | 5.2 | 5.9 | 6.0 | 4.7 | 7.5 | 6.2 | 8.5 | 8.2 | 8.6 |
| Diluted EPS (US$) | 5.44 | 6.37 | 7.54 | 7.88 | 6.31 | 10.04 | 8.33 | 11.56 | 11.39 | 11.95 |
| Diluted shares (millions) | 861 | 816 | 786 | 765 | 750 | 752 | 741 | 732 | 722 | 716 |
| Cash flow | ||||||||||
| Cash from operations | 6.1 | 5.6 | 7.0 | 8.1 | 6.3 | 9.1 | 7.4 | 9.6 | 9.4 | 10.6 |
| Capital expenditure | 1.8 | 1.9 | 2.7 | 2.4 | 1.6 | 2.0 | 1.9 | 2.4 | 2.8 | 3.4 |
| Free cash flow | 4.2 | 3.7 | 4.2 | 5.7 | 4.6 | 7.1 | 5.5 | 7.3 | 6.7 | 7.2 |
| Dividends paid | 3.1 | 3.1 | 3.3 | 3.6 | 3.8 | 3.9 | 4.2 | 4.5 | 4.9 | 5.1 |
| Share buybacks | 11.2 | 4.7 | 5.2 | 5.0 | 0.9 | 0.8 | 3.9 | 3.1 | 2.8 | 2.1 |
| Acquisitions | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Stock-based compensation | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.2 | 0.2 | 0.2 | 0.2 |
| Balance sheet at fiscal year end | ||||||||||
| Cash and short-term investments | 1.2 | 2.5 | 0.9 | 0.9 | 3.4 | 4.7 | 2.6 | 4.6 | 1.1 | 0.8 |
| Debt incl. finance leases | 26.0 | 29.5 | 31.1 | 34.2 | 37.4 | 35.6 | 35.9 | 41.3 | 41.0 | 43.1 |
| Total assets | 31.0 | 33.8 | 32.8 | 47.5 | 52.6 | 53.9 | 50.4 | 56.1 | 55.2 | 59.5 |
| Total liabilities | 33.2 | 37.1 | 39.1 | 55.7 | 60.5 | 58.5 | 56.4 | 60.9 | 59.0 | 61.3 |
| Shareholders' equity | −2.2 | −3.3 | −6.3 | −8.2 | −7.8 | −4.6 | −6.0 | −4.7 | −3.8 | −1.8 |
| Margins and ratios | ||||||||||
| Gross margin | — | — | — | — | — | — | — | — | — | — |
| Operating margin | 31.4% | 41.9% | 41.5% | 42.5% | 38.1% | 44.6% | 40.4% | 45.7% | 45.2% | 46.1% |
| Net margin | 19.0% | 22.8% | 27.9% | 28.2% | 24.6% | 32.5% | 26.6% | 33.2% | 31.7% | 31.9% |
| Free cash flow margin | 17.2% | 16.2% | 19.9% | 26.8% | 24.1% | 30.6% | 23.7% | 28.5% | 25.7% | 26.7% |
| Return on capital | 23.0% | 25.0% | 28.0% | 27.8% | 22.0% | 32.6% | 27.6% | 31.6% | 27.4% | 25.4% |
| Return on equity | 191.9% | — | — | — | — | — | — | — | — | — |
| Return on assets | 13.6% | 16.0% | 17.8% | 15.0% | 9.4% | 14.2% | 11.8% | 15.9% | 14.8% | 14.9% |
| Net debt to EBITDA | 2.7x | 2.5x | 3.3x | 3.6x | 4.5x | 2.9x | 3.4x | 3.0x | 3.3x | 3.3x |