Earnings quality remains high, evidenced by a 2026Q1 OCF/NI ratio of 1.22, though significant capital allocation to dividends and buybacks totaling $1.7 billion in 2026Q1 limits balance sheet flexibility.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 |
|---|
| Cash from Operations | 10.54B | 10.55B | 9.45B | 9.61B | 7.39B | 9.14B | 6.27B | 8.12B | 6.97B | 5.55B | 6.06B | 6.54B | 6.73B | 7.12B | 6.97B | 7.15B | 6.34B | 5.75B | 5.92B | 4.88B | 4.34B | 4.34B | 3.9B | 3.27B | 2.89B | 2.69B | 2.75B | 3.01B | 2.77B | 2.44B | 2.46B |
| Operating CF Margin % | - | 39.24% | 36.45% | 37.7% | 31.86% | 39.36% | 32.62% | 38.02% | 32.77% | 24.33% | 24.61% | 25.73% | 24.53% | 25.34% | 25.27% | 26.48% | 26.34% | 25.29% | 25.16% | 21.4% | 20.78% | 22.69% | 20.99% | 19.07% | 18.76% | 18.08% | 19.32% | 22.69% | 22.27% | 21.41% | 23.03% |
| Operating CF Growth % | 45.44% | 11.69% | -1.72% | 30.12% | -19.2% | 45.91% | -22.86% | 16.58% | 25.5% | -8.39% | -7.33% | -2.84% | -5.48% | 2.22% | -2.57% | 12.75% | 10.27% | -2.81% | 21.35% | 12.32% | 0.11% | 11.1% | 19.42% | 13.1% | 7.51% | -2.3% | -8.55% | 8.77% | 13.27% | -0.76% | 7.18% |
| Net Income | 8.68B | 8.56B | 8.22B | 8.47B | 6.18B | 7.55B | 4.73B | 6.03B | 5.92B | 5.19B | 4.69B | 4.53B | 4.76B | 5.59B | 5.46B | 5.5B | 4.95B | 4.55B | 4.31B | 2.4B | 3.54B | 2.6B | 2.28B | 1.47B | 893.5M | 1.64B | 1.98B | 1.95B | 1.55B | 1.64B | 1.57B |
| Depreciation & Amortization | 2.25B | 2.2B | 2.1B | 1.98B | 1.87B | 1.87B | 1.75B | 1.62B | 1.48B | 1.36B | 1.52B | 1.56B | 1.64B | 1.59B | 1.49B | 1.42B | 1.28B | 1.22B | 1.21B | 1.21B | 1.25B | 1.25B | 1.2B | 1.15B | 1.05B | 1.09B | 1.01B | 956.3M | 881.1M | 793.8M | 742.9M |
| Stock-Based Compensation | 143M | 0 | 172M | 175.2M | 167M | 139.2M | 92.4M | 109.6M | 125.1M | 117.5M | 131.3M | 110M | 112.8M | 89.1M | 93.4M | 86.2M | 83.1M | 112.9M | 112.5M | 142.4M | 122.5M | 154.1M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | -20M | -126M | -574M | -686M | -345.7M | -428.3M | 6.4M | 149.7M | 102.6M | -36.4M | -538.6M | -1.4M | -90.7M | 25.2M | 134.5M | 188.4M | -75.7M | 203M | 101.5M | -39.1M | 28.7M | -38.3M | -171.9M | 181.4M | -44.6M | -87.6M | 60.5M | 52.9M | 35.4M | -1.1M | 32.9M |
| Other Non-Cash Items | -338M | -191M | -33M | -216M | 162.3M | -436.9M | -103.4M | -79M | -194.6M | -105.1M | 96.9M | 177.6M | 369.5M | 26.8M | -92M | -82.6M | 240.7M | -503.1M | -63.6M | 1.2B | -440.6M | -43M | 405.7M | 622M | 491.5M | 50.4M | -244.1M | -65.1M | 22.9M | -65.9M | 42.9M |
| Working Capital Changes | -173M | 106M | -438M | -108M | -644.6M | 454.2M | -212.1M | 298.5M | -472.7M | -980.5M | 167M | 167.9M | -63.6M | -191.4M | -123.1M | 40M | -129M | 171M | 245.8M | -36.2M | -163.2M | 412.3M | 190.3M | -191M | 400.3M | 2.6M | -52.9M | 116.9M | 276.8M | 73M | 69.7M |
| Change in Receivables | 0 | 231M | 10M | -161M | -264.1M | 309.9M | -6.8M | 27M | -479.4M | -340.7M | -159M | -180.6M | 27M | 56.2M | -29.4M | -160.8M | -50.1M | -42M | 16.1M | -100.2M | -90.8M | -56.5M | 64M | 64M | 1.6M | 0 | -67.2M | 0 | 0 | 0 | 0 |
| Change in Inventory | 0 | 0 | 71M | 16.7M | 5.6M | -62.2M | -68.6M | 128.8M | -1.9M | -37.3M | 28.1M | 44.9M | -4.9M | -44.4M | -27.2M | -52.2M | -50.8M | 1M | -11M | -29.6M | -1.6M | -29.4M | -14.9M | -30.2M | -38.1M | -62.9M | -29.6M | -47.7M | -18.1M | -34.5M | -18.7M |
| Change in Payables | 0 | 100M | -10M | 50.4M | 31.3M | 225M | -137.5M | -26.8M | 129.4M | -59.7M | 89.8M | -15M | -74.7M | -60.7M | 124.1M | 35.8M | -39.8M | -2.2M | -40.1M | -36.7M | 82.8M | 35.8M | -77.6M | -77.6M | -11.2M | 0 | 89.7M | 0 | 0 | 0 | 0 |
| Cash from Investing | -3.83B | -3.82B | -5.35B | -3.18B | -2.68B | -2.17B | -1.55B | -3.07B | -2.46B | 562M | -981.6M | -1.42B | -2.3B | -2.67B | -3.17B | -2.57B | -2.06B | -1.66B | -1.62B | -1.15B | -1.27B | -1.82B | -1.38B | -1.37B | -2.47B | -2.07B | -2.21B | -2.26B | -1.95B | -2.22B | -2.57B |
| Capital Expenditures | -3.5B | -3.37B | -2.77B | -2.36B | -1.9B | -2.04B | -1.64B | -2.39B | -2.74B | -1.85B | -1.82B | -1.81B | -2.58B | -2.82B | -3.05B | -2.73B | -2.14B | -1.95B | -2.14B | -1.95B | -1.74B | -1.61B | -1.57B | -1.68B | -2.55B | -2.24B | -2.37B | -2.21B | -2B | -2.22B | -2.51B |
| CapEx % of Revenue | 12.74% | 12.52% | 10.71% | 9.25% | 8.19% | 8.78% | 8.54% | 11.2% | 12.9% | 8.12% | 7.4% | 7.14% | 9.41% | 10.05% | 11.06% | 10.11% | 8.87% | 8.58% | 9.08% | 8.54% | 8.34% | 8.4% | 8.44% | 9.82% | 16.57% | 15.05% | 16.64% | 16.66% | 16.08% | 19.5% | 23.52% |
| Acquisitions | 175M | 244M | -2.19B | -246M | -322.2M | -178M | 37.6M | -48.9M | 589.5M | 2.49B | 866.1M | 413.6M | 319.4M | 259.1M | 236.2M | 325M | 194.5M | 260.3M | 331.8M | -228.8M | 358.8M | -343.5M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -506M | -701M | -376M | -581.2M | -456.7M | 52.3M | 57.4M | -628.5M | -302.9M | -79.1M | -26.6M | -19.7M | -40.9M | -108.2M | -354.3M | -166.1M | -115M | -108.4M | -50.2M | 1.03B | 109.7M | 132.5M | 185.9M | 313.6M | 85.6M | 169.6M | 158M | -53.3M | 49.5M | 7.6M | -57.3M |
| Cash from Financing | -6.81B | -7.13B | -7.5B | -4.37B | -6.58B | -5.6B | -2.25B | -4.99B | -5.95B | -5.31B | -11.26B | 735.3M | -4.62B | -4.04B | -3.85B | -4.53B | -3.73B | -4.42B | -4.11B | -4B | -5.19B | 361.6M | -1.63B | -1.74B | -511.2M | -623.7M | -536.7M | -626.8M | -860.3M | -213.6M | 104.4M |
| Debt Issued (Net) | 282M | -72M | -71M | 2.99B | 1.2B | -1.07B | 2.24B | 3.24B | 2.13B | 2.03B | 2.67B | 9.76B | 1.5B | 535.3M | 1.2B | 1B | 787.4M | 219.3M | 1.05B | 572.6M | -2.26B | 1.61B | -815.5M | -891.6M | 145.5M | 527.3M | 1.68B | 336.4M | 262.4M | 1B | 779.3M |
| Equity Issued (Net) | -1.75B | -1.77B | -2.82B | -3.05B | -3.9B | -845.5M | -907.8M | -4.98B | -5.21B | -4.69B | -11.17B | -6.1B | -3.2B | -1.78B | -2.62B | -3.36B | -2.24B | -2.8B | -3.92B | -3.94B | -1.98B | -433.9M | -40.5M | -219.8M | -670.2M | -1.07B | -2.02B | -891.5M | -1.09B | -1.11B | -599.9M |
| Dividends Paid | -5.17B | -5.12B | -4.87B | -4.53B | -4.17B | -3.92B | -3.75B | -3.58B | -3.26B | -3.09B | -3.06B | -3.23B | -3.22B | -3.11B | -2.9B | -2.61B | -2.41B | -2.24B | -1.82B | -1.77B | -1.22B | -842M | -695M | -503.5M | -297.4M | -287.7M | -280.7M | -264.7M | -240.5M | -247.7M | -232M |
| Share Repurchases | -1.98B | -2.06B | -2.82B | -3.05B | -3.9B | -845.5M | -907.8M | -4.98B | -5.21B | -4.69B | -11.17B | -6.1B | -3.2B | -1.78B | -2.62B | -3.36B | -2.7B | -2.8B | -3.92B | -3.94B | -2.96B | -1.2B | -621M | -391M | -670.2M | -1.07B | -2.02B | -891.5M | -1.09B | -1.11B | -599.9M |
| Other Financing | -167M | -167M | 270M | 220M | 286.4M | 239M | 173.5M | 327M | 383.2M | 436.3M | 296.4M | 309.6M | 293.5M | 314.1M | 457.3M | 435.9M | 127.4M | 392.6M | 582.5M | 1.14B | 272.6M | 25.2M | -82.5M | -121.9M | 310.9M | 204.8M | 88.9M | 193M | 207.6M | 145.7M | 157M |
| Net Change in Cash | -68M | -311M | -3.49B | 2B | -2.13B | 1.26B | 2.55B | 32.5M | -1.6B | 1.24B | -6.46B | 5.61B | -720.8M | 462.6M | 400K | -51.3M | 591M | -267.4M | 82.1M | -146.8M | -2.12B | 2.88B | 887M | 162.4M | -87.7M | -3.6M | 2.2M | 120.3M | -860.3M | -213.6M | 104.4M |
| Free Cash Flow | 7.04B | 7.19B | 6.67B | 7.25B | 5.49B | 7.1B | 4.62B | 5.73B | 4.22B | 3.7B | 4.24B | 4.73B | 4.15B | 4.3B | 3.92B | 4.42B | 4.21B | 3.8B | 3.78B | 2.93B | 2.6B | 2.73B | 2.33B | 1.59B | 337.9M | 450.5M | 380.9M | 800.4M | 768.6M | 217.5M | -52M |
| FCF Margin % | 25.65% | 26.73% | 25.74% | 28.45% | 23.67% | 30.58% | 24.08% | 26.81% | 19.88% | 16.2% | 17.21% | 18.59% | 15.11% | 15.29% | 14.21% | 16.37% | 17.47% | 16.7% | 16.08% | 12.86% | 12.44% | 14.28% | 12.56% | 9.25% | 2.19% | 3.03% | 2.67% | 6.04% | 6.19% | 1.91% | -0.49% |
| FCF Growth % | 5% | 7.7% | -8.03% | 32.2% | -22.73% | 53.57% | -19.27% | 35.58% | 14.27% | -12.76% | -10.3% | 13.95% | -3.47% | 9.68% | -11.39% | 5.09% | 10.72% | 0.46% | 29.07% | 12.7% | -4.78% | 16.94% | 47.24% | 369.25% | -24.99% | 18.27% | -52.41% | 4.14% | 253.38% | 518.27% | -122.37% |
| FCF per Share | 9.87 | 10.03 | 9.24 | 9.91 | 7.40 | 9.45 | 6.17 | 7.49 | 5.38 | 4.53 | 4.92 | 5.00 | 4.20 | 4.27 | 3.84 | 4.23 | 3.89 | 3.43 | 3.30 | 2.42 | 2.08 | 2.14 | 1.83 | 1.24 | 0.26 | 0.34 | 0.28 | 0.57 | 0.55 | 0.15 | -0.04 |
| FCF Conversion (FCF/Net Income) | 0.81x | 1.23x | 1.15x | 1.13x | 1.20x | 1.21x | 1.32x | 1.35x | 1.18x | 1.07x | 1.29x | 1.44x | 1.41x | 1.27x | 1.27x | 1.30x | 1.28x | 1.26x | 1.37x | 2.04x | 1.22x | 1.67x | 1.71x | 2.22x | 3.23x | 1.64x | 1.39x | 1.54x | 1.78x | 1.49x | 1.56x |
| Interest Paid | 0 | 0 | 1.52B | 1.29B | 1.18B | 1.2B | 1.14B | 1.07B | 959.6M | 885.2M | 873.5M | 640.8M | 573.2M | 532.7M | 533.7M | 489.3M | 457.9M | 468.7M | 507.8M | 392.7M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 2.97B | 2.99B | 3.02B | 2.4B | 1.44B | 1.59B | 1.73B | 2.79B | 2.39B | 1.99B | 2.39B | 2.55B | 2.45B | 2.06B | 1.71B | 1.68B | 1.29B | 1.44B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Debt-funded capital allocation
According to recent financial statements, MCD consistently demonstrates high-quality earnings, with the OCF/NI ratio frequently exceeding 1.20, as seen in the 1.22 multiple reported for 2026Q1, which highlights the company's ability to translate accounting profits into tangible cash flow through its asset-light franchise model.
The consistent premium of operating cash flow over net income suggests that non-cash charges and the structural nature of royalty collections provide a reliable cash buffer. Investors should monitor whether this conversion efficiency persists if inflationary pressures force the company to offer more aggressive rent concessions to franchisees.
As reported in quarterly filings, MCD's free cash flow margins have exhibited significant variance, ranging from a low of 16.3% in 2024Q2 to a peak of 34.1% in 2025Q3, reflecting the impact of lumpy capital expenditure cycles on the company's underlying cash generation capabilities.
While the absolute cash generation remains robust, the volatility in FCF margins suggests that management's timing of store modernizations and digital infrastructure investments creates periodic drags on liquidity. This fluctuation warrants further investigation into whether these capital outlays are yielding the expected incremental returns on invested capital.
Based on MCD's reported figures, capital expenditure as a percentage of revenue has fluctuated between 8.9% and 15.1% over the last ten quarters, indicating that the company continues to prioritize significant reinvestment into its global store footprint to maintain its competitive real estate advantage.
The elevated CapEx levels appear to be a strategic necessity to support the 'Accelerating the Arches' initiative and digital integration. Analysts should consider whether this level of capital intensity is sustainable without pressuring the company's already strained balance sheet, particularly if same-store sales growth begins to decelerate.
Data from recent cash flow statements indicates that MCD consistently prioritizes shareholder returns, with dividend payments and share repurchases frequently consuming a substantial portion of free cash flow, as evidenced by the $1.3 billion dividend payout and $396 million buyback recorded in 2026Q1.
The reliance on debt to fund these capital returns, combined with the company's negative book value of equity, suggests a highly aggressive financial posture. This strategy may limit the company's flexibility to navigate potential economic downturns or unexpected operational shocks without further increasing its leverage profile.
Quick answers to the most common questions about buying MCD stock.
McDonald's Corporation (MCD) generated $10.55B in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
McDonald's Corporation (MCD) generated $7.19B in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
McDonald's Corporation (MCD) spent $3.37B on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, McDonald's Corporation (MCD) returned $5.12B to shareholders via cash dividends and spent $2.06B on share repurchases. This shows the company's commitment to returning capital to its equity investors.