McDonald's Corp Stock

McDonald's Corporation operates and franchises McDonald's restaurants in the global restaurant industry.

All restaurants are operated either by the company or by franchisees, including conventional franchisees under franchised arrangements, and developmental licensees or affiliates under license agreements. The company serves a locally relevant menu of quality food and beverages in communities across 100 countries.

Segments

The company operates through the United States (U.S.) and International Operated Markets. In addition, there is the International Developmental Licensed Markets & Corporate segment, which includes markets in over 75 countries, as well as Corporate activities.

U.S. - This segment is the company's largest market. The segment is 95% franchised as of December 31, 2023.

International Operated Markets - This segment consists of markets, or countries in which it operates and franchises restaurants, including Australia, Canada, France, Germany, Italy, Poland, Spain and the U.K. The segment is 89% franchised as of December 31, 2023.

International Developmental Licensed Markets & Corporate - This segment consists primarily of developmental licensee and affiliate markets in the McDonald's system. Corporate activities are also reported in this segment. The segment is 98% franchised as of December 31, 2023.

McDonald's franchised restaurants are owned and operated under one of the following structures - conventional franchise, developmental license or affiliate. The optimal ownership structure for an individual restaurant, trading area or market (country) is based on a variety of factors, including the availability of individuals with entrepreneurial experience and financial resources, as well as the local legal and regulatory environment in critical areas such as property ownership and franchising. The business relationship between the company and its independent franchisees is supported by adhering to standards and policies, including McDonald's Global Brand Standards, and is of fundamental importance to overall performance and to protecting the McDonald's brand.

Directly operating McDonald's restaurants contributes significantly to the company's ability to act as a credible franchisor. In addition, in the company-owned and operated restaurants, and in collaboration with franchisees, the company is able to further develop and refine operating standards, marketing concepts and product and pricing strategies that will ultimately benefit McDonald's restaurants.

The company's revenues consist of sales by company-operated restaurants and fees from franchised restaurants operated by conventional franchisees, developmental licensees and affiliates. The company's Other revenues consists of fees paid by franchisees to recover a portion of costs incurred by the company for various technology platforms, revenues from brand licensing arrangements to market and sell consumer packaged goods using the McDonald's brand and, for periods prior to its sale on April 1, 2022, third-party revenues for the company's Dynamic Yield business.

Conventional Franchise

Under a conventional franchise arrangement, the company generally owns or secures a long-term lease on the land and building for the restaurant location and the franchisee pays for equipment, signs, seating and decor.

Developmental License or Affiliate

Under a developmental license or affiliate arrangement, licensees are responsible for operating and managing their businesses, providing capital (including the real estate interest) and developing and opening new restaurants.

Products

McDonald's restaurants offer a substantially uniform menu, although there are geographic variations to suit local consumer preferences and tastes.

McDonald's menu features hamburgers and cheeseburgers, the Big Mac, the Quarter Pounder with Cheese, the Filet-O-Fish, and several chicken sandwiches like the McChicken, McCrispy and McSpicy, as well as Chicken McNuggets, World Famous Fries, shakes, McFlurry frozen desserts, sundaes, soft serve cones, cookies, pies, soft drinks, coffee, McCafe beverages and other beverages.

McDonald's restaurants in the U.S. and many international markets offer a full or limited breakfast menu. Breakfast offerings may include breakfast sandwiches, such as the Egg McMuffin, Sausage McMuffin with Egg and McGriddles, biscuit and bagel sandwiches, oatmeal, hash browns, breakfast burritos and hotcakes.

In addition to these menu items, restaurants sell a variety of other products during limited-time promotions.

Taste, quality, choice, value and nutrition are important to customers, and the company is continuously evolving its menu to meet its customers' needs, including testing new products on an ongoing basis.

Marketing

McDonald's global brand is well known. Marketing, promotional and public relations activities are designed with customers in mind and are focused on promoting the McDonald's brand and differentiating the company from its competitors. Marketing and promotional efforts focus on value, quality, food taste, menu choice, nutrition, convenience, cultural relevance and the customer experience.

Intellectual Property

The company owns or is licensed to use valuable intellectual property, including trademarks, service marks, patents, copyrights, trade secrets and other proprietary information. The company considers the McDonald's trademark and the Golden Arches Logo to be of material importance to its business. Depending on the jurisdiction, trademarks and service marks generally are valid as long as they are used and/or registered. The company's patents, copyrights and licenses are of varying durations.

Strategy

The company's accelerating the arches growth strategy (the Strategy) encompasses all aspects of McDonald's business as the leading global omni-channel restaurant brand.

The key elements of the company's strategy are to maximize its marketing by investing in new, culturally relevant approaches, grounded in fan truths, to effectively communicate the story of its brand, food and purpose; commit to the core menu by tapping into customer demand for the familiar and focusing on serving its iconic products that are beloved by customers around the world, such as its World Famous Fries, Big Mac, Quarter Pounder and Chicken McNuggets, which are a few of its seventeen unique billion-dollar brands; building on its foundational strength with burgers, the company will continue to evolve and innovate its longest-standing menu item with plans to implement Best Burger; and digital, delivery, drive thru and restaurant development by leveraging competitive strengths and building a powerful digital experience growth engine to deliver a personalized and convenient customer experience.

Environmental Matters

To guide its management of environmental matters and to strengthen its resiliency, the company has developed goals and commitments that are informed by relevant frameworks, including the Taskforce on Climate-Related Financial Disclosures.

History

McDonald's Corporation was founded in 1940. The company was incorporated in 1964.