McDonald’s Corp. (NYSE:MCD)

Total assets

The total assets exhibited minor fluctuations over the five-year period. Starting at $52,627 million in 2020, the figure increased slightly to $53,854 million in 2021, representing a modest upward trend. In 2022, total assets declined to $50,436 million, marking a noticeable contraction. However, the trend reversed in 2023 with a rise to $56,147 million, the highest point in the examined timeframe. The year 2024 saw a slight decrease to $55,182 million, though the figure remained significantly higher than 2020 and 2022 levels.

Adjusted total assets

The adjusted total assets followed a similar pattern to total assets but consistently remained lower each year. Beginning at $50,491 million in 2020, the value declined to $51,497 million in 2021, exhibiting a mild increase despite the mostly downward trend. In 2022, adjusted total assets decreased to $47,959 million, paralleling the decline observed in total assets. The figure rebounded to $53,124 million in 2023, reflecting recovery aligned with the total assets' movement. In 2024, adjusted total assets declined again to $51,639 million, mirroring the slight dip in total assets but maintaining a close correlation overall.

General observations

Both total assets and adjusted total assets demonstrate cyclical movements with decreases in 2022 followed by rebounds in 2023. The adjustment consistently results in a reduction of asset values, which suggests the exclusion of certain items or recalculations impacting the reported total. These trends indicate dynamic asset management or external factors influencing asset valuation, with an overall pattern of recovery after the mid-period decline.

The analysis of the annual liabilities data reveals several notable trends over the five-year period from December 31, 2020, to December 31, 2024.

Total liabilities

There is a general decline in total liabilities from 60,452 million US dollars at the end of 2020 to 58,980 million US dollars by the end of 2024, indicating a gradual reduction in overall debt obligations. However, this trend is not strictly linear, as an increase was recorded in 2023, with total liabilities rising to 60,854 million US dollars from the previous year's 56,439 million US dollars. This suggests a period of increased borrowing or accumulation of liabilities before decreasing again in 2024.

Adjusted total liabilities

A similar pattern is observed in adjusted total liabilities, which decreased from 57,724 million US dollars in 2020 to 56,288 million US dollars in 2024. The figures show a consistent downward trend from 2020 through 2022, reaching 53,684 million US dollars. However, analogous to total liabilities, there is a subsequent increase to 58,383 million US dollars in 2023 before declining once more in 2024. This fluctuation indicates adjustments related to certain liabilities possibly due to accounting reclassifications or refinement in measurement during the analyzed period.

The overall patterns suggest that while the company has experienced a net reduction in both total and adjusted liabilities over the five-year span, there were brief periods of increased liability levels, particularly noticeable in 2023. This could reflect strategic financial decisions such as leveraging for investment, covering operational costs, or other capital management activities. The consistency between the trends in total liabilities and adjusted total liabilities indicates alignment in reported figures, subject to necessary accounting adjustments.

Shareholders' Equity (Deficit)

The shareholders' equity deficit demonstrates a fluctuating but generally decreasing trend over the analyzed period. Starting at a significant negative value of -7,825 million in 2020, the deficit narrows considerably to -4,601 million in 2021, indicating an improvement in the company's net equity position. However, in 2022, there is a reversal as the deficit expands again to -6,003 million, suggesting some setbacks during that year. Subsequently, the deficit decreases to -4,707 million in 2023 and further to -3,797 million in 2024, demonstrating overall gradual recovery despite persistent negative equity.

Adjusted Shareholders' Equity (Deficit)

The adjusted shareholders’ equity deficit follows a broadly similar pattern to the unadjusted figures but consistently shows a slightly less negative position. In 2020, the deficit stood at -7,233 million, improving to -4,144 million in 2021. In 2022, it worsened to -5,725 million but showed continued improvement in the subsequent years, recording -5,259 million in 2023 and -4,648 million in 2024. This trend indicates that after adjusting for whatever factors are considered in this metric, the company’s financial condition still reflects a negative equity position but with a moderate and steady trend toward mitigation.

Overall Analysis

Both the reported and adjusted shareholders’ equity deficits suggest the company is experiencing challenges in achieving positive net equity, yet there is evidence of gradual improvement throughout the period. The notable reduction in deficit from 2020 to 2021 is offset somewhat by a resurgence in 2022, but subsequent years show a recovery trajectory. The persistent negative equity reflects ongoing financial pressures, but the trend indicates management’s efforts to strengthen the balance sheet may be yielding some positive outcomes over time.

The financial data reveals several notable trends for the periods ending from 2020 through 2024. An analysis of reported debt, shareholders' equity, and total capital, both in reported and adjusted terms, highlights changes in the company’s capital structure and financial position over time.

Total Reported Debt

The total reported debt displayed some fluctuations, decreasing from $37,440 million in 2020 to $35,623 million in 2021, then increasing again to reach a peak of $40,921 million in 2023, before slightly declining to $40,205 million in 2024. This indicates a general upward trend in debt levels over the five-year period, particularly after 2021.

Shareholders’ Equity (Deficit)

Shareholders’ equity showed persistent negative values throughout the period, indicating a sustained deficit. Although the deficit narrowed from -$7,825 million in 2020 to -$4,601 million in 2021, it widened again to -$6,003 million in 2022 before gradually improving to -$3,797 million by 2024. The movement suggests some volatility, with periods of improvement but an overall trend towards a less negative equity position by 2024.

Total Reported Capital

Total reported capital exhibited a generally increasing trend, rising from $29,616 million in 2020 to $36,408 million in 2024, with consistent growth especially notable after 2021. This reflects an expanding capital base over the analyzed years.

Adjusted Total Debt

Adjusted total debt decreased from $51,463 million in 2020 to $48,699 million in 2022, showing a reduction in leverage initially. However, like the reported debt, adjusted debt increased after 2022, reaching $53,091 million in 2023 before a slight decline to $51,948 million in 2024. The adjusted figures consistently exceed the reported debt levels, suggesting the inclusion of additional debt-like obligations or adjustments.

Adjusted Shareholders’ Equity (Deficit)

The adjusted shareholders’ equity similarly remained negative throughout the period, with a deficit that narrowed significantly in 2021 to -$4,144 million but thereafter fluctuated between -$5,259 million and -$4,648 million. The trend indicates some variability but no strong recovery, with persistent negative equity albeit at a relatively stable level in recent years.

Adjusted Total Capital

Adjusted total capital generally increased from $44,230 million in 2020 to a peak of $47,833 million in 2023, followed by a minor decrease to $47,300 million in 2024. The capital base, when considering adjustments, showed growth over the period, although with some volatility aligned with variations in equity and debt components.

In summary, both reported and adjusted data reveal an overarching increase in total capital and debt, with shareholders’ equity consistently negative but showing signs of gradual improvement toward the end of the period. The company’s financial structure exhibits leverage fluctuations, with a tendency towards increased debt levels after 2021, contrasted by a cautiously improving equity deficit. These patterns suggest ongoing efforts to manage capital and debt, though negative equity remains a notable concern across all years analyzed.

The annual financial data demonstrates a steady upward trend in both reported revenues and adjusted revenues over the five-year period ending in 2024. The revenues increased from US$19,208 million in 2020 to US$25,920 million in 2024, reflecting consistent growth each year with a notable increase particularly between 2022 and 2023.

Adjusted revenues followed a similar pattern, rising from US$19,249 million in 2020 to US$25,908 million in 2024. The difference between reported and adjusted revenues remains minimal across the years, indicating that adjustments made to revenues have not significantly altered the overall revenue recognition patterns.

Trend over years

There is a clear and continuous increase in revenue figures from 2020 through 2024, suggesting progressive growth in sales or service income.

Growth consistency

Despite minor fluctuations in growth rates, the general trend is positive without any apparent declines or stagnation, highlighting ongoing business expansion or successful revenue-generating activities.

Relationship between reported and adjusted revenues

The close alignment of reported and adjusted revenues implies that non-standard revenue adjustments have had a limited impact, supporting the reliability and consistency of the reported revenue figures.

The financial data over the five-year period indicates fluctuations in both net income and adjusted net income. Net income demonstrated an overall upward trajectory, starting at 4,731 million US dollars in 2020 and increasing substantially to 7,545 million US dollars in 2021. Following this peak, it experienced a decline to 6,177 million US dollars in 2022 before rising again to 8,469 million US dollars in 2023. In 2024, net income saw a slight decrease, settling at 8,223 million US dollars.

Adjusted net income shows a similar pattern, moving from 4,674 million US dollars in 2020 up to 7,166 million US dollars in 2021. It then decreased to 5,938 million US dollars in 2022 before rising to 7,845 million US dollars in 2023. In 2024, adjusted net income declined modestly to 7,541 million US dollars.

Net Income

Marked by notable volatility, the net income spiked impressively in 2021, decreased in the subsequent year, then rose sharply again in 2023 before a slight retraction in 2024.

Adjusted Net Income

The adjusted figures follow the same overall trend as net income but remain marginally lower each year, indicating some adjustments that reduce the final earnings reported.

Trend Analysis

This oscillating pattern suggests that while the company experienced periods of strong profitability, there were also setbacks or adjustments impacting earnings during the timeline observed. The general growth from 2020 to 2024, despite fluctuations, indicates resilience and the capacity to rebound after periods of lower profitability.