McDonald's Q3 Earnings Beat EPS and Raises Dividend Amid Mixed Sales

McDonald's (MCD) reported third-quarter adjusted earnings of $3.57 per share, up 11% and ahead of the $3.38 analysts expected, while revenue of $7.16 billion missed the $7.28 billion forecast. The shares closed 6.5% higher at $280.22 on Wednesday, per SentiSense price data, after trading up about 5% in the morning. Zacks attributed the beat to franchised restaurant margins, which rose 3% to $3.8 billion.

The sales picture was split by region. Global comparable sales rose 1.5%, led by international markets, while U.S. comparable sales slipped 0.2%, a smaller decline than the 0.5% Wall Street had forecast. Chief Executive Chris Kempczinski said U.S. comparable sales turned positive in September after slight declines in July and August, following the company's intervention on value.

Value is the main lever. McDonald's began an eight-week test of two new everyday affordable menu constructs in about 1,900 restaurants, and franchisees representing roughly 4,000 more restaurants are running similar bundles, together more than 40% of the U.S. system, with a goal of a national program in early 2027. Checks that include a specialty beverage run about 50% above the full-day average, and the company reiterated its goal of franchising 98% of its global restaurants by 2028.

McDonald's also raised its quarterly dividend 4% to $1.93 per share, its 50th straight annual increase. Points to watch are the results of the value test in early 2027 and whether U.S. guest counts keep improving; CFO Ian Borden cautioned on the call that he had not said fourth-quarter U.S. comps would be better.