McDonald's (MCD) FY2025 10-K Review

INCOME STATEMENTCASH FLOWBALANCE SHEETSEGMENTSVARIANCE YoYBUSINESS QUALITYQUARTERLYOWNERSHIPEVERY FIGURE AS FILED · $M EXCEPT PER-SHARE

Income statement · $ millions	2025	2024	2023
Total revenues	26,885	25,920	25,494	3
· International operated markets	13,633	12,628	12,382
· US market	10,825	10,631	10,568
· International developmental licensed marketsand corporate	2,427	2,661	2,543
Selling, general and administrative	3,039	2,858	2,817
Depreciation, depletion and amortization	457	447	382
Impairments	—	—	72
Total operating expenses	14,492	14,208	13,847
Operating income	12,393	11,712	11,647	2
Interest expense	1,582	1,506	1,361	1
Other income (expense), net	87	139	236
Income tax provision	2,334	2,121	2,053	1
— of which current	2,460	2,695	2,740	1
Net income attributable to common	8,563	8,223	8,469	2
Diluted earnings per share	$11.95	$11.39	$11.56	2
Weighted-average diluted shares	0	0	0

Cash flow · $ millions	2025	2024	2023
Net income incl. noncontrolling interests	8,563	8,223	8,469
Depreciation, depletion and amortization	457	447	382
Share-based compensation	165	172	175
Deferred income taxes	(126)	(574)	(686)
Change in receivables	(231)	(10)	161
Change in payables	100	(10)	50
Net cash provided by operating activities	10,551	9,447	9,612	5
Capital expenditure	3,365	2,775	2,357	2
Net cash used in investing activities	(3,822)	(5,346)	(3,185)
Dividends paid	5,115	4,870	4,533	2
Repurchases of common stock	2,056	2,824	3,054	2
Debt issued	4,724	2,380	5,221
Debt repaid	4,802	2,777	2,441
Net cash used in financing activities	(7,125)	(7,495)	(4,374)
Cash and equivalents at end of period	774	1,085	4,579

Balance sheet · $ millions	2025	2024
Cash and cash equivalents	774	1,085
Receivables, net	2,466	2,383	1
Inventories	61	56	1
Total current assets	4,163	4,599
Property, plant and equipment, net	28,241	25,295
Goodwill	3,354	3,145	1
Total assets	59,515	55,182	1
Accounts payable	1,149	1,029
Current debt	—	0
Total current liabilities	4,361	3,861
Long-term debt	39,973	38,424
Stockholders' equity	(1,791)	(3,797)
Total equity	(1,791)	(3,797)

Segments · as filed in the segment note · $ millions	International operated markets	US market	International developmental licensed marketsand corporate	Corporate / unallocated	Consolidated
Net sales	13,633	10,825	2,427	—	26,885
Selling, general & administrative	705	653	1,682	(1)	3,039
Operating income	6,382	5,808	203	—	12,393
· operating margin	46.8%	53.7%	8.4%	—	46.1%
Capital expenditure	2,048	1,277	40	—	3,365
Assets	27,487	23,008	9,020	—	59,515

Rows render only when the filed members reconcile to the consolidated line; Corporate / unallocated is consolidated − Σ segments, arithmetic on filed lines. A concept whose members do not faithfully partition the total is omitted, never approximated.

Largest FY/FY moves · $ millions, ranked by \|Δ\|	FY2025	FY2024	Δ $	Δ %	Reading
Total assets · BS	59,515	55,182	+4,333	+7.9%	—
Property, plant and equipment, net · BS	28,241	25,295	+2,946	+11.6%	—
Debt issued · CF	4,724	2,380	+2,344	+98.5%	◐ outsized
Debt repaid · CF	4,802	2,777	+2,025	+72.9%	◐ outsized
Stockholders' equity · BS	(1,791)	(3,797)	+2,006	+52.8%	◐ outsized
Total equity · BS	(1,791)	(3,797)	+2,006	+52.8%	◐ outsized
Long-term debt · BS	39,973	38,424	+1,549	+4.0%	—
Net cash used in investing activities · CF	(3,822)	(5,346)	+1,524	+28.5%	—
Net cash provided by operating activities · CF	10,551	9,447	+1,104	+11.7%	—
· International operated markets · IS	13,633	12,628	+1,005	+8.0%	—
Total revenues · IS	26,885	25,920	+965	+3.7%	—
Repurchases of common stock · CF	2,056	2,824	−768	-27.2%	—
Operating income · IS	12,393	11,712	+681	+5.8%	—
Capital expenditure · CF	3,365	2,775	+590	+21.3%	—

Business quality — Buffett/Munger screen · deterministic · not part of the filing score	Value	Reading
Return on equity net income ÷ average of start- and end-of-year equity	-306.5% sector median 19.8%	weak
Share count, year-end (year-end shares − prior year-end) ÷ prior year-end	+0.0% sector median -2.5%	flat
Debt to equity (current debt + long-term debt) ÷ year-end equity	-22.72 sector median 0.26	low
FCF consistency, 5yr operating cash flow − capital expenditure, per year	positive 5 of 5	consistent
Margin stability pre-tax income ÷ revenue, swing across up to five years	pre-tax margin 46.1% sector median 11.7%	cyclical

Quarterly · as filed in 10-Q/10-K · $ millions	SEP 24	MAR 25	JUN 25	SEP 25	MAR 26
Total revenues	6,873	5,956	6,843	7,078	6,517
Cost of revenue	646	620	654	666	676
Selling, general and administrative	647	682	700	785	759
Depreciation, depletion and amortization	111	107	106	121	111
Total operating expenses	3,685	3,308	3,611	3,721	3,564
Operating income	3,188	2,648	3,232	3,357	2,953
Interest expense	381	376	390	406	400
Other income (expense), net	(36)	(57)	(18)	1	(11)
Income tax provision	588	461	608	671	559
Net income attributable to common	2,255	1,868	2,253	2,278	1,983
Diluted earnings per share	$3.13	$2.60	$3.14	$3.18	$2.78
Weighted-average diluted shares	0	0	0	0	0
Net cash provided by operating activities	2,736	2,428	1,998	3,428	2,412

Largest QoQ moves · latest vs prior filed quarter	Prior	Latest	Δ $	Δ %
Net cash provided by operating activities	3,428	2,412	−1,016	-29.6%
Total revenues	7,078	6,517	−561	-7.9%
Operating income	3,357	2,953	−404	-12.0%
Net income attributable to common	2,278	1,983	−295	-12.9%
Total operating expenses	3,721	3,564	−157	-4.2%
Income tax provision	671	559	−112	-16.7%
Selling, general and administrative	785	759	−26	-3.3%
Other income (expense), net	1	(11)	−12	-1,200.0%

Ownership — insiders & floatForm 4 + 10-K cover · open-market trades only	Value	Reading
Public float	$208,464M	10-K cover · as of 2025-06-30
Insider Form 4s, 90d	8 filings · 0 buys / 5 sells	net selling · −$3,262,622
· Erlinger Joseph M.	SELL $1,493,249	Form 4 filed 2026-06-10 · open market
· Erlinger Joseph M.	SELL $806,182	Form 4 filed 2026-04-13 · open market
· Ralls-Morrison Desiree	SELL $769,109	Form 4 filed 2026-06-01 · open market
· Erlinger Joseph M.	SELL $100,806	Form 4 filed 2026-04-23 · open market
· Erlinger Joseph M.	SELL $93,277	Form 4 filed 2026-05-27 · open market
Insider ownership %	—	needs the proxy statement — not read yet, never estimated
· The Vanguard Group, 100 Vanguard Boulevard, Malvern, PA 19355	10.03%	5%+ holder · DEF 14A filed 2026-04-07
· BlackRock, Inc., 50 Hudson Yards, New York, NY 10001	7.3%	5%+ holder · DEF 14A filed 2026-04-07
· State Street Corporation, 1 Congress St., Ste 1, Boston, MA 02114	5.1%	5%+ holder · DEF 14A filed 2026-04-07
Institutional %	3 holders of 5%+ named	full 13F total pending — never estimated
· 10b5-1 adopted	Dario Baroni, President, International Developmental Licensed Markets	November 17, 2025 · 600 shares · 10-K insider trading arrangements

COMMENTARY7EARNINGS QUALITY8

10-Q · quarter ended 2026-03-31 · filed 2026-05-07 · 0 match · 2 partly · 3 contradict

Quarterly revenue growth✗CONTRADICTS

“Consolidated revenues increased 9% (4% in constant currencies).”

Revenues, quarterly $7.1B → $6.5B-561

Revenues, quarterly (vs year-ago quarter) $6.9B → $6.5B-356

The stated direction runs against the filed lines: Revenues, quarterly fell ($7.1B → $6.5B) while the quote reads the other way.

2 LINES TRACED · 10-Q · ITEM 2 · FILED 2026-05-07

Net income and EPS growth◐PARTLY

“Net income increased 6% (1% in constant currencies) to $ 1,983 million, and diluted earnings per share increased 7% (2% in constant currencies) to $ 2.78 .”

Net income incl. noncontrolling interests, quarterly $2.3B → $2.0B-295

Net income incl. noncontrolling interests, quarterly (vs year-ago quarter) $2.3B → $2.0B-272

Diluted EPS, quarterly $0.00 → $0.00-0.00

Diluted EPS, quarterly (vs year-ago quarter) $0.00 → $0.00-0.00

Quoted $ 1,983 millionNet income incl. noncontrolling interests, quarterly: filed $2.0B

1 of 6 quoted figures reconcile ($ 1,983 million against net income incl. noncontrolling interests, quarterly); $ 2.78 , 1% does not map to a filed line on this page — carried as partly supported.

4 LINES TRACED · 10-Q · ITEM 2 · FILED 2026-05-07

Operating cash flow vs capex◐PARTLY

“Cash provided by operations totaled $2.4 billion and exceeded capital expenditures by $1.7 billion.”

Operating cash flow, quarterly $3.4B → $2.4B-1,016

Capital expenditure, quarterly $1.0B → $682M-329

Quoted $2.4 billionOperating cash flow, quarterly: filed $2.4B

1 of 2 quoted figures reconcile ($2.4 billion against operating cash flow, quarterly); $1.7 billion does not map to a filed line on this page — carried as partly supported.

2 LINES TRACED · 10-Q · ITEM 2 · FILED 2026-05-07

Operating cash flow comparison✗CONTRADICTS

“Cash provided by operations was relatively flat compared to the three months ended 2025, as changes in working capital offset improved operating results.”

Operating cash flow, quarterly (vs year-ago quarter) $2.7B → $2.4B-324

The stated direction runs against the filed lines: Operating cash flow, quarterly (vs year-ago quarter) fell ($2.7B → $2.4B) while the quote reads the other way.

1 LINES TRACED · 10-Q · ITEM 2 · FILED 2026-05-07

Investing activities/capex increase✗CONTRADICTS

“Cash used for investing activities totaled $777 million, a slight increase from the three months ended 2025, reflecting the Company's increased capital expenditures in the current year.”

Capital expenditure, quarterly (vs year-ago quarter) $794M → $682M-112

The stated direction runs against the filed lines: Capital expenditure, quarterly (vs year-ago quarter) fell ($794M → $682M) while the quote reads the other way.

1 LINES TRACED · 10-Q · ITEM 2 · FILED 2026-05-07

10-K · FY2025 annual review

revenue growth◐PARTLY

“Consolidated revenues increased 4% (2% in constant currencies) to $26.9 billion.”

Total revenues $25.9B → $26.9B+965

Quoted $26.9 billionTotal revenues: filed $26.9B

Quoted 4%Total revenues: change +3.7%

2 of 3 quoted figures reconcile ($26.9 billion against total revenues; 4% against total revenues); 2% does not map to a filed line on this page — carried as partly supported.

1 LINES TRACED · ITEM 7 · 2025 FINANCIAL PERFORMANCE · P.8

operating income◐PARTLY

“Consolidated operating income increased 6% (4% in constant currencies) to $12.4 billion.”

Operating income $11.7B → $12.4B+681

Quoted $12.4 billionOperating income: filed $12.4B

Quoted 6%Operating income: change +5.8%

2 of 3 quoted figures reconcile ($12.4 billion against operating income; 6% against operating income); 4% does not map to a filed line on this page — carried as partly supported.

1 LINES TRACED · ITEM 7 · 2025 FINANCIAL PERFORMANCE · P.8

EPS growth◐PARTLY

“Diluted earnings per share of $11.95 increased 5% (4% in constant currencies).”

Diluted earnings per share $11.39 → $11.95+0.56

Quoted $11.95 Diluted earnings per share: filed $11.95

Quoted 5%Diluted earnings per share: change +4.9%

2 of 3 quoted figures reconcile ($11.95 against diluted earnings per share; 5% against diluted earnings per share); 4% does not map to a filed line on this page — carried as partly supported.

1 LINES TRACED · ITEM 7 · 2025 FINANCIAL PERFORMANCE · P.8

operating cash flow✓MATCHES

“Cash provided by operations was $10.6 billion, a 12% increase from the prior year.”

Net cash provided by operating activities $9.4B → $10.6B+1,104

Quoted $10.6 billionNet cash provided by operating activities: filed $10.6B

Quoted 12%Net cash provided by operating activities: change +11.7%

Every quoted figure reconciles to the filed lines: $10.6 billion against net cash provided by operating activities; 12% against net cash provided by operating activities.

1 LINES TRACED · ITEM 7 · 2025 FINANCIAL PERFORMANCE · P.8

free cash flow◐PARTLY

“Free cash flow was $7.2 billion, an 8% increase from the prior year.”

Net cash provided by operating activities $9.4B → $10.6B+1,104

Capital expenditure $2.8B → $3.4B+590

The quoted figures do not map one-for-one onto a filed line on this page; carried as partly supported.

2 LINES TRACED · ITEM 7 · 2025 FINANCIAL PERFORMANCE · P.8

shareholder returns◐PARTLY

“The Company returned a total of $7.1 billion to shareholders through dividends and share repurchases in 2025.”

Dividends paid $4.9B → $5.1B+245

Repurchases of common stock $2.8B → $2.1B-768

The quoted figures do not map one-for-one onto a filed line on this page; carried as partly supported.

2 LINES TRACED · ITEM 7 · 2025 FINANCIAL PERFORMANCE · P.8

net income growth◐PARTLY

“In 2025, net income increased 4% (3% in constant currencies) to $8,563 million and diluted earnings per common share increased 5% (4% in constant currencies) to $11.95.”

Net income attributable to common $8.2B → $8.6B+340

Diluted earnings per share $11.39 → $11.95+0.56

Quoted $8,563 millionNet income attributable to common: filed $8.6B

Quoted 4%Net income attributable to common: change +4.1%

Quoted $11.95Diluted earnings per share: filed $11.95

4 of 5 quoted figures reconcile ($8,563 million against net income attributable to common; 4% against net income attributable to common; $11.95 against diluted earnings per share); 3% does not map to a filed line on this page — carried as partly supported.

2 LINES TRACED · ITEM 7 · NET INCOME AND DILUTED EARNINGS PER COMMON SHARE · P.13

Goodwill weight◐WATCH

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Goodwill$3,354M

Total assets$59,515M

Weight $3,354M ÷ $59,515M5.6%

Impairments, three years (newest first)— · — · $72M

Goodwill is 5.6% of assets with impairments in the period — carried as watch.

EARNINGS-QUALITY FLAG · 2 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Cash tax vs book charge◐WATCH

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Cash income taxes paid$2,688M

Total book tax charge$2,334M

Divergence ($2,688M − $2,334M) ÷ $2,334M+15.2%

Deferred tax asset $1,629M → $2,218M+589M

Cash taxes paid diverge from the total book charge by +15.2%. Carried as watch.

EARNINGS-QUALITY FLAG · 2 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Receivables pace✓CLEAN

SILENT IN MD&ADisclosed in the statements; not discussed by management.

DSO, prior year $2,383M ÷ $25,920M × 36533.6 days

DSO, current year $2,466M ÷ $26,885M × 36533.5 days

Change-0.1 days

Days sales outstanding moved -0.1 days — inside the ±7-day watch threshold.

EARNINGS-QUALITY FLAG · 2 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Interest coverage✓CLEAN

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Operating income$12,393M

Interest expense$1,582M

Coverage $12,393M ÷ $1,582M7.8×

Operating income covers interest 7.8× (threshold 6×).

EARNINGS-QUALITY FLAG · 2 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Inventory vs revenue pace✓CLEAN

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Inventory $56M → $61M+8.9%

Revenue $25,920M → $26,885M+3.7%

Gap 8.9% − 3.7%+5.2pp

Inventory moved +8.9%, revenue +3.7% (gap +5.2pp). The flag tests inventory OUTRUNNING revenue by more than 7pp.

EARNINGS-QUALITY FLAG · 2 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Cash conversion stability✓CLEAN

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Operating cash flow, three years (newest first)$10,551M · $9,447M · $9,612M

Net income attributable to common, three years (newest first)$8,563M · $8,223M · $8,469M

OCF ÷ NI, three years (newest first)1.23× · 1.15× · 1.13×

Swing 1.23× − 1.13×0.10×

Cause verified by this pageno

OCF ÷ NI ran 1.23× · 1.15× · 1.13× across three years — swing 0.10×, inside the 1.00× threshold.

EARNINGS-QUALITY FLAG · 2 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Capital returned vs free cash flow✓CLEAN

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Capital returned ÷ FCF, three years (newest first)1.00× · 1.15× · 1.05×

Current year ($5,115M + $2,056M) ÷ ($10,551M − $3,365M)1.00×

Capital returned ran 1.00× of free cash flow (threshold 1.00×).

EARNINGS-QUALITY FLAG · 4 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Stock compensation in cash flow✓CLEAN

SILENT IN MD&ADisclosed in the statements; not discussed by management.

Share-based compensation$165M

Operating cash flow$10,551M

Share $165M ÷ $10,551M1.6%

Share-based compensation is 1.6% of operating cash flow (threshold 15%).

EARNINGS-QUALITY FLAG · 1 LINES TRACED · COMPUTED FROM THE FILED STATEMENTS

Not investment advice. DHI Signal publishes impersonal, rules-based research; no recommendation to buy or sell any security is made or implied. Every statement figure is transcribed from McDonald's's Form 10-K for FY2025 (accession 0000063908-26-000035), pulled from EDGAR XBRL. Derived measures are computed only from lines shown on this page and the arithmetic is displayed so it can be checked. MCD is not in the tracked book. Market posture attaches only when the dashboard feed carries the name; this page computes none of it.

Income statement & cash flow

Balance sheet & market

Filing & document terms