McDonald`s Corp

Top-line + comps: modest growth, but U.S. underperformed expectations - System-wide sales: +4% constant currency in Q2 (growth supported by new unit openings). - Global comparable sales: +1.3% in Q2; IOM/I.D.M. positive but consumer traffic in key markets remained flat-to-negative. - U.S. comparable sales: +0.8% in Q2 (and +2.3% for H1), explicitly called below expectations—management stressed it’s not a strategy problem, but an execution problem.

What went wrong in the U.S. (big negatives / drivers of the miss) - Value execution was inconsistent: the EDAP “10 items for under $3” launched in April. - Only ~60–65% of the system executed the recommended EDAP pricing architecture. - Customer awareness was below target, reducing incremental traffic. - A “bad trade” hit loyalty/offers: the business pulled back digital offers and removed “Buy One, Add One for $1”, which management said hurt visits from loyal customers. - 2/3 of the U.S. traffic underperformance was attributed to these value execution factors; the remainder was largely attributed to the June FIFA campaign underperforming vs expectations. - Operations pressure: restaurant teams were overwhelmed by too many deployments, worsening service times and contributing to lower satisfaction scores.

What management says is already being fixed (near-term actions + timing) - Operations: management expects the fastest improvement because it’s “within control,” focused on simplifying deployments/cadence for the rest of the year so crews can deliver better hospitality. - Marketing/value in the U.S.: - Starting next week: more national digital flash offers to re-energize high-frequency customers. - More personalized offers targeted to most loyal users. - Reallocate marketing dollars in H2 to support proven value programs like Extra Value Meals. - Marketing changes are expected to be limited in Q3 (programs already “in flight”), with greater adjustments in Q4; management guided that recovery should be fully back by 2027. - Franchise alignment mechanism: for EDAP pricing noncompliance, the system will use education + “business reviews” that can affect growth/eligibility (stronger enforcement signal).