McDonald’s Reports Largest U.S. Same-Store Sales Decline Since 2020

McDonald’s reported its largest same-store sales drop in the U.S. since the onset of the COVID-19 pandemic, as the fast-food giant faced adverse weather conditions and shifting consumer behavior. For the first quarter of 2025, the company’s U.S. same-store sales fell by 3.6%, marking the steepest decline in its home market since a dramatic 8.7% drop in Q2 2020, during the height of the pandemic lockdowns.

The drop came as McDonald’s struggled to attract customers, particularly from the lower- and middle-income segments. CEO Chris Kempczinski explained that the overall industry traffic, particularly from low-income consumers, had fallen significantly. He added that the decline in traffic was now spreading to middle-income consumers, signaling broader economic pressures on consumer spending.

Analysts' Expectations Not Met

Despite reporting adjusted earnings per share (EPS) of $2.67, which narrowly exceeded analysts’ expectations of $2.66, McDonald’s missed revenue projections. The company posted revenue of $5.96 billion, falling short of the $6.09 billion analysts had forecast.

McDonald’s also reported a drop in net income, which fell to $1.87 billion, or $2.60 per share, down from $1.93 billion, or $2.66 per share, in the same period last year.

International Performance Mixed

On the global front, McDonald’s experienced a mixed performance. While same-store sales in its international operated markets, including major locations such as Australia and France, declined by 1%, the company saw positive results in its developmental licensed markets, such as Japan, China, and Brazil. This segment reported a 3.5% growth in same-store sales, beating analyst expectations of 3.2%.

Strategic Moves for Recovery

Looking ahead, McDonald’s is hopeful that its strategies to revive growth will pay off. The company has focused on value-driven menu items and the return of popular offerings, including snack wraps and McCrispy Chicken Strips. A partnership with the video game franchise Minecraft also saw strong sales of limited-edition collectibles.

The company also plans to maintain its $5 meal deal through the remainder of 2025 and has committed to opening 2,200 new locations globally, which is expected to boost systemwide sales growth by more than 2%.

Outlook for the Rest of 2025

While McDonald’s navigates a tough start to the year, it has reiterated its full-year outlook and continues to invest in expanding its global presence. The company aims to open new locations, increase capital spending, and adjust its menu offerings to attract more customers and overcome current economic challenges.