McDonald’s (MCD) reported Q2 2026 revenue of $7.10 billion, up 4% from $6.84 billion, while diluted EPS rose 6% to $3.32 from $3.14. Global comparable sales remained positive in every segment but slowed to 1.3% from 3.8%, with higher U.S. checks partly offset by lower guest counts. Higher franchised margins and other operating income supported earnings, while selling, general and administrative expenses increased.

Core Earnings Data

For the quarter ended June 30, reported revenue increased 4%, compared with 2% growth in constant currencies. Operating income rose 3%, or 2% in constant currencies, indicating that currency translation provided some benefit to the reported results.

McDonald’s recorded $52 million of pretax charges, equal to $0.06 per share, primarily related to its Accelerating the Organization restructuring program. Excluding specified charges in both periods, adjusted diluted EPS increased 6% to $3.38.

Systemwide sales include sales at both company-operated and franchised restaurants. Franchisee sales are not recorded as McDonald’s revenue but influence the fees and rent the company receives from franchisees.

Business and Segment Performance

Comparable sales increased across all three operating segments, although each segment grew more slowly than in Q2 2025. The sharpest deceleration occurred in International Developmental Licensed Markets.

International Operated Markets were led by Germany, Australia and the U.K., partly offset by France. Japan led the International Developmental Licensed segment, and every geographic region reported positive comparable sales, although China posted a decline.

Franchised restaurant revenue increased 4% to $4.39 billion, while sales from company-operated restaurants rose 3% to $2.53 billion. Management identified higher sales-driven franchised margins as one of the main profit drivers during the quarter.

Loyalty scaled across 70 markets

Systemwide sales to loyalty members increased by more than 20% to $40 billion for the trailing 12 months. McDonald’s also had nearly 220 million active loyalty users, measured over the preceding 90 days, up 13% at quarter-end.

These figures demonstrate wider loyalty-program adoption, but they are not directly comparable with quarterly revenue or comparable sales. Loyalty sales cover a trailing 12-month period and include transactions at franchised restaurants.

U.S. Growth Relied on Higher Checks Rather Than Traffic

U.S. comparable sales increased 0.8%, supported by positive check growth that included a favorable product mix. Negative comparable guest counts partly offset that benefit, meaning the segment’s sales growth did not come from an increase in customer transactions.

Management described the U.S. as an area where execution needs to improve and appointed Skye Anderson as President of McDonald’s USA. The release did not quantify the guest-count decline or separate the contributions from pricing and product mix, limiting visibility into the durability of check-driven growth.

Profitability and Cost Structure

Operating margin was approximately 47.0%, down slightly from about 47.2% a year earlier. Other selling, general and administrative expenses increased 19% to $706 million, while related depreciation and amortization rose 5% to $111 million.

Part of that pressure was offset by other operating income. McDonald’s recorded $37 million of net other operating income, compared with $29 million of expense in the prior-year quarter, representing a $66 million favorable swing. Restructuring charges nevertheless increased to $52 million from $43 million.

Below operating income, interest expense rose 5% to $409 million. The tax provision fell 6% to $574 million even as pretax income increased 3%, lowering the approximate effective tax rate to 19.6% from 21.3%. A 1% decline in diluted weighted-average shares also helped diluted EPS grow slightly faster than net income.

Recent Insider Transactions

The supplied six-month summary categorizes 140,130 shares across 16 transactions as purchases and 81,270 shares across 13 transactions as sales. That produced net purchases of 58,860 shares, equivalent to 3.3% of the reported 1.83 million total insider shares held. However, the 10 most recent individual records consisted of eight sales and two derivative-security exercises, with Joseph M. Erlinger accounting for most of the activity.

The supplied data does not disclose the reasons for these transactions. Derivative-security exercises also should not be treated as equivalent to open-market purchases.

Risks Investors Need to Watch

• U.S. traffic remains under pressure: Higher checks supported comparable sales, but negative guest counts could make growth harder to sustain if check growth weakens.
• Comparable-sales momentum has slowed broadly: All three segments remained positive, but each reported a lower growth rate than in the prior-year quarter.
• Administrative and restructuring costs are elevated: Other SG&A expenses increased 19%, and the quarter included $52 million of restructuring-related pretax charges.
• International performance is uneven: France and China posted negative comparable sales despite positive results across their broader segments.
• Reported growth benefited from currency translation: Revenue increased 4% as reported but only 2% in constant currencies, leaving reported results sensitive to exchange-rate movements.

Summary

McDonald’s delivered higher revenue, operating income and EPS in Q2 2026, supported by franchised margins, a favorable change in other operating income and lower tax expense. The main concern was slower comparable-sales growth, particularly in the U.S., where higher checks offset declining guest counts. Future results will depend on whether the company can improve customer traffic while controlling administrative and restructuring costs.

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