McDonald’s shares slipped 1.7% on Tuesday following a downgrade by equity research firm Redburn Atlantic, which cited concerns that the rising popularity of weight-loss drugs like Ozempic and Wegovy could significantly reduce consumer demand for fast food.
Redburn downgraded McDonald’s stock from “buy” to “sell,” warning that GLP-1 medications—known for appetite suppression and blood sugar regulation—could be “demand disruptors” for the fast-food industry. The analysts estimate McDonald’s could see up to 28 million fewer customer visits annually, potentially resulting in revenue losses of nearly $482 million, or 0.9% of the company’s total sales.
The firm emphasised that these drugs may shift long-term eating habits, particularly among lower-income groups who form a significant portion of McDonald’s customer base. In addition to individual dietary changes, analysts believe GLP-1 use may influence household consumption patterns and group dining behaviour.
Adding to the pressure, inflation and rising menu prices are already straining consumer spending. Analysts noted growing signs of “pricing fatigue” and pointed out that the value gap between dining out and home-cooked meals remains historically wide, making affordability a growing concern for customers.
Although only 6% of American adults currently use GLP-1 drugs, and 12% have tried them, financial experts say the long-term impact could be substantial. While some, like BTIG analyst Peter Saleh, argue the effect on McDonald’s is still limited today, there is increasing recognition that the landscape could shift dramatically over the next few years.
The downgrade reflects broader concerns that the food and beverage sector may need to adapt to evolving health trends that prioritise portion control, calorie reduction, and sustained weight management.