McDonald’s has announced its intention to open approximately 10,000 new restaurants globally by 2027. This ambitious expansion plan is part of the company’s extensive efforts to invest in automation processes and enhance service speed at its stores. McDonald’s aims to more than double revenue from its loyalty program, planning to increase its user base to 250 million customers by 2027, with a target of achieving $45 billion in annual sales.
The fast-food giant highlighted that these expansion plans would propel its restaurant count to around 50,000, spanning over 100 countries. McDonald’s referred to this as the fastest period of growth in the company’s history, setting the stage for a significant milestone.
As of now, the loyalty program boasts 150 million active users, generating over $20 billion in system-wide sales. The company aims to further boost its user base to achieve substantial growth in loyalty program sales.
McDonald’s shares experienced a marginal dip in volatile premarket trading following the announcement. The company has intensified its marketing strategies in recent years, including the implementation of its “Best Burger” initiative aimed at enhancing burger quality. This initiative, initially piloted in 70 markets, is scheduled to be deployed to nearly all markets by 2026.
Looking ahead to 2024, McDonald’s anticipates nearly 2% growth in system-wide sales on a constant currency basis, exceeding the expected 1.5% growth for 2023. Operating margins for the next year are estimated to be in the mid-to-high 40% range.
Additionally, McDonald’s has embraced technology partnerships, such as teaming up with Alphabet’s Google Cloud to deploy artificial intelligence (AI) solutions across its global restaurant network. These solutions aim to automate processes, ensuring the delivery of hotter, fresher food to customers in a more efficient manner.
Despite challenges in U.S. consumer spending, McDonald’s has demonstrated resilience due to its affordable menu items and aggressive promotional efforts. The company exceeded sales and profit estimates in the quarter ended September, showcasing its ability to adapt and thrive in dynamic market conditions.