Direct Answer
McDonald's Corporation (MCD, NYSE) reported total revenues of $25.920 billion in fiscal year 2024, roughly flat versus approximately $25.760 billion in FY2023. Net income was $8.223 billion and diluted EPS was $11.39. Because McDonald's is approximately 95% franchised, its reported revenues reflect the royalties and rent it collects from franchisees plus full restaurant sales at the roughly 5% of locations it operates directly. System-wide sales across all 42,000+ McDonald's restaurants globally totaled approximately $130 billion in FY2024.
Revenue breakdown (FY2023 vs FY2024)
| Revenue source | FY2023 | FY2024 |
|---|---|---|
| Revenues from franchised restaurants (rent and royalties) | ~$14.9B | ~$15.4B |
| Revenues from company-operated restaurants | ~$2.3B | ~$2.5B |
| Total revenues | ~$25.76B | $25.92B |
McDonald's reports revenues across two primary line items. Revenues from franchised restaurants represent the rent and royalty income the company collects from the roughly 40,000 independently owned and operated McDonald's locations. These amounts are a fraction of the food and beverage sales those restaurants generate. Revenues from company-operated restaurants represent full restaurant-level sales at the approximately 2,000 locations McDonald's owns and operates directly.
The franchise revenue line is the financial heart of McDonald's business. McDonald's typically charges franchisees a royalty of approximately 4 to 5 percent of restaurant sales, plus rent on properties where McDonald's owns or leases the underlying real estate. These income streams are contractually recurring and largely independent of commodity price swings, labor costs, or kitchen-level operating challenges that franchisees absorb themselves.
Source: McDonald's Corporation: Form 10-K SEC Filings (CIK 0000063754)
Key financial metrics (FY2023 vs FY2024)
| Metric | FY2023 | FY2024 |
|---|---|---|
| Total revenues | ~$25.760B | $25.920B |
| System-wide sales (all restaurants, est.) | ~$127.5B | ~$130B |
| Global comparable sales growth | +8.7% | -1.0% |
| Net income | ~$8.469B | $8.223B |
| Diluted EPS | ~$11.56 | $11.39 |
| Free cash flow (approx.) | ~$7.2B | ~$6.1B |
| Annual dividend per share | ~$6.68 | $7.08 |
| Global restaurant count | ~40,275 | ~42,000+ |
FY2024 marked a notable reversal after several years of strong comparable sales gains. Global comparable sales fell 1.0 percent, the first annual decline since the 2020 pandemic year. Net income declined modestly to $8.223 billion from roughly $8.469 billion in FY2023, and diluted EPS fell from approximately $11.56 to $11.39. Free cash flow declined from approximately $7.2 billion to approximately $6.1 billion, partly reflecting higher capital expenditures as McDonald's accelerated restaurant upgrades and technology investments.
Despite the operational pressures of 2024, McDonald's continued its streak of annual dividend increases, raising the quarterly dividend to $1.77 per share ($7.08 annualized), extending its consecutive annual increase streak to 48 years.
How McDonald's franchise model shapes its financials
McDonald's approximately 95% franchised structure produces a financial profile that looks very different from a typical restaurant company. Understanding the model is essential for reading McDonald's income statement and cash flow correctly.
In a conventional franchise arrangement, McDonald's grants a franchisee the right to operate a McDonald's restaurant. The franchisee owns or leases the equipment, hires and manages staff, buys the food and packaging, and bears the day-to-day operating risk. In exchange, McDonald's collects a royalty (a percentage of monthly restaurant sales) and, in many cases, rent (McDonald's frequently owns or controls the underlying real estate and subleases to franchisees at a markup).
These two income streams have very different cost structures from running a restaurant. Royalties require no incremental labor or food cost to earn once the franchise agreement is in place. Rent income tied to real estate has the capital characteristics of a property company: relatively predictable cash flows, long lease terms, and asset-backed security. Together, these streams give McDonald's operating margins and cash flow stability that full-service restaurant operators rarely achieve.
System-wide sales of approximately $130 billion in FY2024 represent the total value of food and beverages sold at all McDonald's restaurants globally. McDonald's reported revenues of $25.920 billion represent only the portion of that activity that flows to the corporation as royalties, rent, fees, and company-operated restaurant sales. The gap between those two numbers is not a shortcoming in reporting. It reflects the structural design of the franchise model: the economic benefit of $130 billion in consumer spending flows partly to McDonald's (as royalty and rent income) and partly to the approximately 40,000 independent franchisees (as operating profit after paying McDonald's).
McDonald's has been deliberately reducing its share of company-operated restaurants through a process called refranchising: selling company-owned restaurants to franchisees and converting the economics from full restaurant revenue to royalty and rent income. This reduces revenue in nominal terms but improves the margin quality and predictability of earnings, and frees up capital previously tied up in restaurant operations.
FY2024 headwinds: value perception and the E. coli outbreak
McDonald's FY2024 comparable sales decline of 1.0 percent reflected two distinct but related pressures that played out across the year.
The first was a cumulative consumer backlash against menu price increases. McDonald's, like most U.S. restaurant chains, raised menu prices substantially during 2021 through 2023 to offset food and labor cost inflation. By early 2024, consumer surveys and transaction data indicated that a meaningful share of value-oriented customers were reducing visit frequency or choosing lower-cost alternatives. McDonald's launched a $5 Meal Deal promotion in June 2024 as a direct response, bundling a McDouble or McChicken sandwich, small fries, four-piece Chicken McNuggets, and a small soft drink. The promotion drove an initial traffic lift but required franchisees to accept compressed margin on those bundled transactions.
The second was an E. coli outbreak in October 2024 linked to sliced onions on Quarter Pounder hamburgers. The U.S. Centers for Disease Control and Prevention confirmed 104 illnesses across multiple states and one death. McDonald's temporarily removed Quarter Pounders from menus in affected regions while investigating the supply chain, and subsequently restored the product after determining the source. The outbreak affected same-store sales in the fourth quarter of 2024, compounding the traffic softness already present from value perception concerns.
These two headwinds are operationally distinct but share a common thread: both affect the number of customer visits (traffic) more than average transaction size. McDonald's franchise model provides significant protection against short-term traffic disruptions because royalties and rent are calculated as a percentage of sales, not as a fixed dollar amount. When sales fall, royalty income falls proportionally, but McDonald's avoids the fixed labor and food costs that would magnify losses in a fully company-operated model.
Frequently Asked Questions
What were McDonald's total revenues in fiscal year 2024?
McDonald's reported total revenues of $25.920 billion in fiscal year 2024, approximately flat compared to roughly $25.760 billion in fiscal year 2023. Reported revenues reflect only the royalties, rent, and fees McDonald's collects from its franchisees and the full restaurant sales at the roughly 5% of locations the company operates directly. They do not include the food and beverage sales at the approximately 95% of restaurants owned and operated by independent franchisees.
Why does McDonald's report only $25.9 billion in revenues when system-wide sales are $130 billion?
McDonald's reports only the revenues it directly receives: rent, royalties, and technology fees from approximately 40,000 franchised restaurants, plus full restaurant sales at the roughly 2,000 company-operated locations. The approximately $130 billion in system-wide sales represents the total value of food and beverages sold at all McDonald's restaurants globally, including franchised locations where the sales revenue belongs to the franchisee, not to McDonald's Corporation. McDonald's typically receives around 4 to 5 percent of franchised restaurant sales as a royalty, plus separate rent income on properties it leases to franchisees.
What happened to McDonald's comparable sales in 2024?
McDonald's reported a global comparable sales decline of 1.0 percent in fiscal year 2024, the first annual comparable sales decline since 2020 during the COVID-19 pandemic. The decline reflected two headwinds: consumer concern about value and affordability following years of menu price increases, and an E. coli outbreak linked to Quarter Pounder beef patties in October 2024 that affected sales in the fourth quarter. McDonald's launched a $5 Meal Deal promotion in June 2024 to address the value perception gap.
Is McDonald's a Dividend Aristocrat?
Yes. McDonald's has increased its annual dividend for 48 consecutive years as of 2024, qualifying it as a Dividend Aristocrat (a designation for S&P 500 companies with 25 or more consecutive years of dividend increases). The annualized dividend reached $7.08 per share in 2024, paid at $1.77 per quarter. McDonald's is approaching the 50-year threshold that would qualify it as a Dividend King.