By Evie Liu

Some fast-food giants are staging a comeback after many quarters of sluggish sales.

McDonald's is set to post third-quarter earnings on Wednesday before the market opens. For the three months ended in September, Wall Street analysts polled by FactSet expect the fast-food chain to post $3.33 in earnings per share on $7.08 billion in sales. Earnings are expected to rise 10 cents from a year ago, while sales are expected to grow 3%.

This follows McDonald's strong second-quarter results, where earnings and sales both beat analyst forecasts, while posting year-over-year growth. That is a reversal from the first quarter, when the chain posted revenue that was 3% lower than the year-ago period and missed analysts' expectations.

In the second quarter, global comparable sales were strong in both international stores and the U.S. market, where new menu items and promotional deals have put the burger giant back on the growth track. Same-store sales grew 3.8% from a year ago, a comeback from the 1% decline in the first quarter. For the third quarter, analysts expect same-store sales to increase 3.5%.

Like many fast-food chains, McDonald's hiked prices aggressively during the postpandemic inflation. This pushed price-sensitive consumers to cut back on dining out, opting instead to save money by cooking more meals at home.

To lure customers back, McDonald's has been rolling out new products such as McCrispy Strips and Snack Wraps, and launched value deals like the $5 Meal Deal, and Buy One Get One for $1. Starting in September 2025, the company cut prices on eight popular combo meals in the U.S., setting them about 15% below what the items would cost individually.

The company has also expanded late night operating hours at many of its U.S. restaurants and expanded its beverage business to better engage with younger Gen-Z customers. It's rolled out a range of coffee drinks, refreshers, and "dirty sodas" with add-ins like dried fruit and flavored syrups. Customer reaction to these new offerings would be key to McDonald's growth.

McDonald's shares closed at $299.21 on Tuesday, and are up 3.2% so far this year.

Wall Street's positive outlook for McDonald's comes after strong results from fast-food peer Restaurant Brands International, which owns Burger King, Popeyes, and Tim Hortons. Last week, the company said its third-quarter systemwide sales were 6.9% higher year-over-year, while comparable sales accelerated 4%, on the back of Burger King's 6.4% growth in international markets and 3.2% growth in the U.S. Earnings also increased from 93 cents a year ago to $1.03 per share.

Still, other corners of the restaurant industry are struggling. Last week, Chipotle Mexican Grill shares plunged nearly 20% after the company lowered its guidance for full-year same-store sales that indicate a decline in sales by a low single-digit percentage. Wendy's is expected to report earnings on Friday, sales are expected to drop 5.6% from a year ago, while earnings shrink from 25 cents to 20 cents per share.

Write to Evie Liu at evie.liu@barrons.com

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November 04, 2025 16:41 ET (21:41 GMT)

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