McDonald’s (MCD) Q2 2025 Earnings Call August 06, 2025 08:30 AM ET Speaker0Hello, and welcome to McDonald's Second Quarter twenty twenty five Investor Conference Call. At the request of McDonald's Corporation, this conference is being recorded. Following today's presentation, there will be a question and answer session for investors. I would now like to turn the conference over to Mr. Dexter Combole, Vice President of Investor Relations for McDonald's Corporation.Mr. Combole, you may begin.Speaker1Good morn ...

Group 1 - The article discusses the recent earnings report of McDonald's Corporation (NYSE: MCD) following the earnings reports of major banks and tech companies, indicating a significant focus on the fast-food giant's performance [1] - McDonald's is positioned as a key player in the consumer sector, with its earnings report expected to provide insights into consumer spending trends and overall economic health [1] Group 2 - The author emphasizes the importance of sustained profitability, highlighting strong margins, stable and expanding free cash flow, and high returns on invested capital as critical factors for long-term investment success [2] - The investment strategy focuses on undervalued growth stocks and high-quality dividend growers, suggesting a preference for companies that demonstrate consistent financial performance [2]

Financial Performance - McDonald's earnings per share and revenue exceeded expectations [1] - Global same store sales increased by 38%, surpassing the street's expectation of 26% [1] Menu Innovation & Strategy - McDonald's is accelerating the pace of menu news with IP tie-ins [3] - The company is pulsing value more aggressively than it has been coming out of the pandemic, with the $5 meal deal demonstrating traction [4][5] - Product momentum and product cycle continue to build, with organizational rejiggering to address this [7] - McDonald's is focusing on product innovation, hiring restaurant experience captains to focus on specific menu categories [11] - New product launches are expected, including McDonald's Land, Adult Happy Meal, and a kid's Happy Meal [13] Market & Consumer Trends - International stores outperformed US stores in growth [2] - Customers in the United States are spending more per visit [2] - Value offerings are resonating with families and individuals [6] - McDonald's is regaining its footing after a period of being "offsides" on value and lacking strong product innovation post-COVID [8][9][10] Future Outlook - The company expresses confidence that the current product cycle will persist throughout the year [12][13] - Potential future menu items include Monopoly promotions and the return of the Chicken Big Mac [14]

Company Performance - McDonald's reported quarterly earnings of $3.19 per share, exceeding the Zacks Consensus Estimate of $3.15 per share, and up from $2.97 per share a year ago, representing an earnings surprise of +1.27% [1] - The company posted revenues of $6.84 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.92%, compared to $6.49 billion in the same quarter last year [2] - Over the last four quarters, McDonald's has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Outlook - The immediate price movement of McDonald's stock will depend on management's commentary during the earnings call and the sustainability of earnings expectations [3][4] - McDonald's shares have increased by approximately 3.1% since the beginning of the year, while the S&P 500 has gained 7.1% [3] - The current consensus EPS estimate for the upcoming quarter is $3.37 on revenues of $6.97 billion, and for the current fiscal year, it is $12.27 on revenues of $26.42 billion [7] Industry Context - The Retail - Restaurants industry, to which McDonald's belongs, is currently ranked in the bottom 32% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact McDonald's stock performance [5][6]

Core Viewpoint - McDonald's Q2 financial results indicate a recovery in sales driven by collaborations with pop culture and affordable meal strategies, effectively alleviating consumer economic anxiety [1] Group 1: Financial Performance - Q2 revenue increased by 5% year-over-year to $6.84 billion, surpassing analyst expectations of nearly $6.7 billion [1] - Adjusted earnings per share for Q2 were $3.19, exceeding the average analyst forecast of $3.14 [1] - Global same-store sales rose by 3.8% year-over-year, outperforming Bloomberg's analyst average expectations [1] Group 2: Market Performance - The international market led growth, while the U.S. market saw a same-store sales increase of 2.5%, reversing a 0.7% decline from the previous year [1] - CEO Chris Kempczinski attributed the performance to attractive pricing, effective marketing, and menu innovation [1] Group 3: Strategic Initiatives - In Q2, McDonald's launched several initiatives to attract customers, including themed meals tied to the release of the "Minecraft" movie and limited-time Squishmallows toy collaborations [2] - The company introduced new chicken strip items in the U.S. and offered $5 meal deals to appeal to price-sensitive consumers [2] - Starting in September, McDonald's plans to test new beverages, including cold brew coffee and specialty sodas, in over 500 U.S. locations [3] Group 4: Stock Performance - Following the earnings report, McDonald's stock rose by 3.9% in pre-market trading [3] - Year-to-date, the stock has increased by 3.1%, lagging behind the S&P 500's 7.1% gain during the same period [3]

1. 8月6日(周三)美股盘前，美股三大股指期货齐涨。截至发稿，道指期货涨0.35%，标普500指数期货涨0.24%，纳指期货涨 0.23%。 2. 截至发稿，德国DAX指数涨0.02%，英国富时100指数涨0.20%，法国CAC40指数涨0.28%，欧洲斯托克50指数涨0.22%。 3. 截至发稿，WTI原油涨1.63%，报66.22美元/桶。布伦特原油涨1.52%，报68.67美元/桶。 | 瑞 伦敦布伦特原油 | 2025年10月 | 68.67 | 68.81 | 67.65 | +1.03 | +1.52% | | --- | --- | --- | --- | --- | --- | --- | | 雪 WTI原油 | 2025年9月 | 66.22 | 66.34 | 65.12 | +1.06 | +1.63% | 市场消息 降息预期凌乱，华尔街投行"吵"起来。美国"非农"数据暴雷令美联储降息预期飙升，但本周华尔街知名投行对降息分歧却在加 大。高盛、花旗均认为，9月或激进降息，摩根大通甚至认为今年可能降息125个基点。然而，美银认为今年美联储或按兵不 动，巴克莱和汇丰同样态度谨慎。未来几个月将 ...

Market Overview - US stock index futures are all up ahead of the market opening, with Dow futures rising by 0.35%, S&P 500 futures up by 0.24%, and Nasdaq futures increasing by 0.23% [1] - European indices also show positive movement, with Germany's DAX up by 0.02%, UK's FTSE 100 up by 0.20%, France's CAC40 up by 0.28%, and the Euro Stoxx 50 up by 0.22% [2][3] - WTI crude oil prices increased by 1.63% to $66.22 per barrel, while Brent crude oil rose by 1.52% to $68.67 per barrel [3][4] Economic Insights - There is a growing divergence among Wall Street investment banks regarding interest rate cuts, with Goldman Sachs and Citigroup suggesting aggressive cuts in September, while Bank of America and Barclays remain cautious [4] - The upcoming months are critical for determining the Federal Reserve's interest rate decisions, especially if employment and inflation data continue to show weakness [4] - Concerns about the credibility of government data have arisen following President Trump's criticism of employment data, which could impact the TIPS market significantly [5] Company News - Supermicro (SMCI.US) reported a 7.5% year-over-year increase in Q4 sales to $5.76 billion, but this fell short of market expectations of $6.01 billion, leading to a nearly 17% pre-market drop [7][8] - AMD (AMD.US) saw a 32% year-over-year revenue increase to $7.7 billion in Q2, but its adjusted earnings per share of $0.48 fell below expectations, resulting in a nearly 6% pre-market decline [8] - Novo Nordisk (NVO.US) reported a 32% year-over-year increase in net profit for Q2, driven by strong sales of its semaglutide products, which generated $16.68 billion in revenue [9] - Honda (HMC.US) adjusted its full-year guidance upward despite a 1.2% year-over-year decline in Q1 revenue, anticipating a reduction in tariff-related losses [10] - McDonald's (MCD.US) reported a 5.4% year-over-year revenue increase in Q2, exceeding expectations, with same-store sales growth driven primarily by higher customer spending [11] - Uber (UBER.US) exceeded revenue expectations for Q2, reporting $12.65 billion, and provided a positive outlook for Q3 [11] - Disney (DIS.US) reported Q3 earnings that surpassed expectations, although traditional TV revenue fell short, overshadowing strong performance in theme parks and streaming [12] - Lucid (LCID.US) reported a Q2 adjusted loss of $0.24 per share, below expectations, and lowered its annual production guidance to 18,000-20,000 vehicles [13] - Snap (SNAP.US) experienced a significant drop in advertising revenue growth, leading to a nearly 18% pre-market decline following its Q2 earnings report [13]

Financial Performance - McDonald's earnings per share were $3.19, $0.04 better than expected [1] - McDonald's revenue reached $6.8 billion, exceeding expectations [1] Sales Performance - Global same-store sales increased by 3.8%, surpassing the expected 2.6% [1] - US same-store sales grew by 2.5%, slightly above the anticipated 2.4% [2] - Operated markets saw a 4% increase, significantly higher than the projected 1.7% [2] - Licensed international markets experienced a 5.6% rise, outperforming the expected 3.8% [3] Stock Performance - McDonald's stock is up by approximately 2.9% [1][3]

Core Insights - McDonald's reported Q2 2025 revenue of $6.843 billion, an increase from $6.49 billion in the same period last year [1] - The company achieved a Q2 earnings per share of $3.14, up from $2.80 in the previous year [1]

Core Insights - McDonald's reported Q2 revenue of $6.84 billion, exceeding the forecast of $6.7 billion [1] - The company achieved Q2 earnings per share of $3.14, up from $2.80 in the same period last year [1] - Same-store sales for Q2 surpassed market expectations [1]