Lower-income traffic falls, high-income demand remains strong
McDonald’s missed Wall Street’s third-quarter earnings expectations, but delivered stronger-than-expected same-store sales in the U.S., a sign of resilience in an uneven consumer environment. CEO Chris Kempczinski called the results a “testament to our ability to deliver sustainable growth even in a challenging environment.”
Adjusted earnings per share came in at $3.22, below the $3.33 expected by analysts, while revenue reached $7.08 billion, slightly under the $7.1 billion forecast. Net income for the quarter totaled $2.28 billion, up from $2.26 billion a year earlier, despite a higher tax rate.
U.S. sales outperform, driven by check growth
Same-store sales in the U.S. grew 2.4%, beating expectations of 1.9%. The increase was largely attributed to higher average checks, showing consumers continue to pay more per visit. This comes despite ongoing price competition in the fast-food sector, often referred to as “value wars.”
In a move aimed at attracting budget-conscious customers, McDonald’s reintroduced Snack Wraps at $2.99, marking their first return in nearly a decade. CFO Ian Borden noted the wraps became one of the most successful chicken launches in recent U.S. history, with nearly 20% of customers purchasing one within the first month.
The company also brought back Extra Value Meals in September, which were last promoted pre-pandemic. Executives stated that these value-driven promotions helped McDonald’s gain market share among higher-income consumers as well.
Global markets deliver even stronger growth
Outside the U.S., the international operated markets segment, including Canada and Australia, saw same-store sales rise 4.3%. The international licensed markets division, which covers countries like Japan, posted a 4.7% increase. These gains were credited to effective value platforms that improved customer perceptions of affordability.
However, executives warned that growth in international same-store sales could moderate in the next quarter due to tougher year-over-year comparisons. Meanwhile, in the U.S., the company expects Q4 sales to improve, helped by promotions like the Monopoly game and continued traction from value offerings.
Consumer pressure to persist through 2026
McDonald’s continues to see a split in its customer base. CEO Kempczinski noted that visits from lower-income diners have declined by nearly double digits, a trend that has persisted for nearly two years. In contrast, traffic from higher-income customers remains strong and is growing at nearly the same rate.
The company expects this economic pressure to remain through 2026, signaling that consumer spending patterns may stay divided for the foreseeable future. Nevertheless, McDonald’s shares rose over 3% in morning trading as investors reacted positively to the company’s same-store sales growth and continued strategic focus on value.
