McDonald's Beats Q4 Estimates as Comps Jump 5.7%
Golden Arches posts $7.01B revenue and $3.12 EPS, both above forecasts. US same-store sales surge 6.8% as value menu strategy pays off.
McDonald's turned in a quarter that should quiet the skeptics. The world's largest restaurant chain reported Q4 revenue of $7.01 billion, beating the $6.81 billion consensus, with earnings per share of $3.12 versus the $3.03 estimate.
Global comparable sales rose 5.7%, with the US leading at 6.8%—a sharp acceleration from earlier quarters when traffic concerns weighed on the stock. International markets contributed broad-based gains, with systemwide sales approaching $140 billion for the full year.
The results mark a clean sweep after a year of execution challenges. Value menu struggles, traffic declines, and competition from fast-casual chains had put pressure on management. Q4 showed the turnaround is gaining traction.
The Value Strategy Works
McDonald's spent much of 2025 recalibrating its value positioning. Customers were complaining about prices. Traffic was soft. The $5 meal deal and other promotional bundles were management's answer.
The Q4 numbers suggest it worked. US same-store sales of 6.8% represent genuine recovery. That's not easy in an environment where consumer spending is under pressure from higher interest rates and persistent inflation in services.
CEO Chris Kempczinski emphasized that the value message resonated without destroying margins. The company managed to grow traffic while maintaining average check size—a balance that eluded competitors who leaned too hard into discounting.
| Metric | Q4 2025 | Estimate | Beat/Miss |
|---|---|---|---|
| Revenue | $7.01B | $6.81B | Beat |
| EPS | $3.12 | $3.03 | Beat |
| Global Comps | +5.7% | -- | -- |
| US Comps | +6.8% | -- | -- |
Loyalty Drives Digital
The loyalty program continues to outperform expectations. Systemwide sales to loyalty members rose 20% to nearly $37 billion. Active loyalty users—people who've engaged in the past 90 days—hit approximately 210 million, up 19% year over year.
That's a massive database for personalized marketing. McDonald's can now target promotions to specific customer segments, drive repeat visits, and gather real-time data on purchasing patterns. It's the kind of capability that used to be exclusive to tech companies.
The digital business also helps franchisee economics. Mobile orders are more efficient for restaurants, reducing labor costs per transaction. As digital mix grows, unit economics improve even without price increases.
Full Year and Outlook
For 2025 in total, revenues increased 4% to $26.9 billion. Net income rose 4% to $8.6 billion. Diluted EPS climbed 5% to $11.95. Those are solid but not spectacular numbers for a mature company.
The 2026 outlook is more ambitious. Management expects systemwide sales growth of 2.5% from new restaurant expansion alone, with 2,600 new locations planned. Comp growth would be additive to that base.
But there's a warning embedded in the guidance: Q1 2026 comparable sales growth is expected to decelerate from Q4 levels. January traffic was softer than December. The holiday bump faded.
Stock Reaction
Shares dipped in early trading Wednesday despite the beat. At 25x forward earnings, McDonald's isn't cheap for a restaurant stock. Investors wanted not just a good quarter but acceleration in the guidance—and they didn't quite get it.
The stock has recovered significantly from its 2025 lows when traffic concerns peaked. For further upside, the market needs to see sustained US comp growth above 5% and evidence that international markets—particularly China—are stabilizing.
What to Watch
McDonald's reports monthly comparable sales data, so investors don't have to wait until Q1 earnings for the next read. January numbers land in a few weeks. If US comps hold above 5%, the bull case remains intact. A sharp deceleration would validate the cautious guidance.
Competition also bears watching. Chipotle and other fast-casual chains have been aggressive on pricing. Starbucks is fighting its own traffic battles. The restaurant sector is promotional, and McDonald's pricing power is only as durable as its value perception.
For now, Q4 delivered what shareholders needed: proof that the value menu strategy works and that the loyalty flywheel keeps spinning. Whether that's enough to justify the current multiple is a different question.