McDonald's U.S. Sales Slip as Franchisees Eye the Next Bill

McDonald's had a fine quarter. Its U.S. franchisees had a harder one.

The company reported Nov. 4 that U.S. comparable sales fell 0.2% in the third quarter, against a 2.4% gain a year earlier, as negative guest counts were “largely offset by positive check growth.” Globally, comparable sales rose 1.5%, systemwide sales topped $38 billion and adjusted earnings per share rose 11% to $3.57.

That split is the franchise model doing what it was built to do. About 95% of McDonald's restaurants are run by independent owners, and the corporation collects rent and fees on their sales whether traffic rises or falls. The owners absorb the lost visits themselves. U.S. comps ran 3.9% in the first quarter and 0.8% in the second before turning negative, Franchise Herald noted.

“In the U.S., we're encouraged by improvement as the quarter progressed following our intervention on value,” CEO Chris Kempczinski said.

The timing is awkward. In September, McDonald's unveiled Next, a modernization plan that bundles remodels, connected kitchen equipment, automated inventory tracking and Archy, a voice AI that takes orders in English and Spanish. Nation's Restaurant News put the cost at about $800,000 per store with a four-year payback after corporate support, according to Franchise Herald. McDonald's has committed about $8.5 billion in franchisee support through 2036.

Operators aren't sold. In an October note, BTIG analyst Peter Saleh wrote that the plan's 250-basis-point margin target “seems highly theoretical” to franchisees, Restaurant Association reported. They warmed more to the inventory tools than to the voice ordering, and some wondered “if the consumer actually wants this technology.” Saleh summed up the mood as “reluctant acceptance.”

Here's my read. McDonald's says Archy can free at least 50 labor hours a week per restaurant, and that is the number that has to carry the rest of the bill. Taco Bell is already putting figures on its drive-thru AI. McDonald's has promised progress updates through 2027. Owners looking at falling traffic will want them sooner.

There is one more number to watch. The company trimmed its 2026 opening target by 100 restaurants and pushed its 50,000-unit goal to the end of 2028, which leaves same-store sales doing more of the work.