Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

McDonald’s Corp., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenues from franchised restaurants	15,715)	15,437)	14,106)	13,085)	10,726)
Sales by Company-operated restaurants	9,782)	9,742)	8,748)	9,787)	8,139)
Other revenues	423)	316)	328)	350)	343)
Revenues	25,920)	25,494)	23,183)	23,223)	19,208)
Franchised restaurants, occupancy expenses	(2,536)	(2,475)	(2,350)	(2,335)	(2,208)
Food & paper	(2,995)	(3,039)	(2,737)	(3,097)	(2,564)
Payroll & employee benefits	(2,959)	(2,886)	(2,617)	(2,677)	(2,416)
Occupancy & other operating expenses	(2,381)	(2,299)	(2,026)	(2,273)	(2,001)
Company-operated restaurant expenses	(8,335)	(8,224)	(7,381)	(8,047)	(6,981)
Other restaurant expenses	(339)	(233)	(245)	(260)	(267)
Gross margin	14,710)	14,563)	13,207)	12,580)	9,752)
Depreciation and amortization	(447)	(382)	(370)	(330)	(301)
Other	(2,412)	(2,435)	(2,492)	(2,378)	(2,245)
Selling, general & administrative expenses	(2,859)	(2,817)	(2,863)	(2,708)	(2,546)
Gains on sales of restaurant businesses	94)	103)	60)	97)	23)
Equity in earnings of unconsolidated affiliates	157)	153)	113)	177)	117)
Asset dispositions and other income (expense), net	(100)	7)	(137)	(75)	(291)
Impairment and other gains (charges), net	(290)	(362)	(1,010)	285)	268)
Other operating income (expense), net	(139)	(99)	(974)	483)	118)
Operating income	11,712)	11,647)	9,371)	10,356)	7,324)
Interest expense, net of capitalized interest	(1,506)	(1,361)	(1,207)	(1,186)	(1,218)
Nonoperating income (expense), net	139)	236)	(339)	(42)	35)
Income before provision for income taxes	10,345)	10,522)	7,825)	9,128)	6,141)
Provision for income taxes	(2,122)	(2,053)	(1,648)	(1,583)	(1,410)
Net income	8,223)	8,469)	6,177)	7,545)	4,731)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

The financial data reveals several notable trends over the five-year period from 2020 to 2024. Revenues from franchised restaurants displayed consistent growth each year, increasing from 10,726 million USD in 2020 to 15,715 million USD in 2024. Sales by company-operated restaurants experienced variability, rising initially from 8,139 million USD in 2020 to 9,787 million USD in 2021, then declining to 8,748 million USD in 2022, before recovering to 9,782 million USD in 2024. Other revenues remained relatively stable with a modest increase from 343 million USD in 2020 to 423 million USD in 2024. Overall revenues grew steadily from 19,208 million USD in 2020 to 25,920 million USD in 2024.

Expense categories generally increased, reflecting the growth in operations. Occupancy expenses for franchised restaurants rose from 2,208 million USD in 2020 to 2,536 million USD in 2024. Food and paper costs, after peaking at 3,097 million USD in 2021, decreased slightly to 2,995 million USD in 2024. Payroll and employee benefits expenses steadily increased, reaching 2,959 million USD in 2024. Occupancy and other operating expenses showed fluctuations but trended upward, ending at 2,381 million USD. Company-operated restaurant expenses followed a similar pattern to sales, with an initial rise and subsequent decrease, stabilizing around 8,335 million USD in 2024. Other restaurant expenses remained relatively low but showed a notable increase to 339 million USD in 2024.

Gross margin exhibited consistent growth, increasing from 9,752 million USD in 2020 to 14,710 million USD in 2024, indicating enhanced profitability from core operations despite rising expenses. Depreciation and amortization expenses increased steadily, reaching 447 million USD in 2024. Other operating income and expenses reflected volatility, particularly impairment and other charges, which showed a significant negative impact in 2022 and subsequent years, suggesting some one-time or non-recurring costs adversely affecting operating results during this period.

Operating income followed a positive trend overall, growing from 7,324 million USD in 2020 to 11,712 million USD in 2024, despite the fluctuations in impairment and other gains or charges. Interest expense gradually increased over the period, reaching 1,506 million USD in 2024, which could indicate higher debt levels or increased borrowing costs. Nonoperating income and expense figures fluctuated, with a notable negative figure in 2021 and improvements thereafter.

Income before taxes rose significantly from 6,141 million USD in 2020 to a peak of 10,522 million USD in 2023, followed by a slight decrease to 10,345 million USD in 2024. The provision for income taxes increased in line with pre-tax income, reaching 2,122 million USD in 2024. Net income showed a strong upward trend from 4,731 million USD in 2020 to 8,223 million USD in 2024, with a dip in 2022 but recovering substantially thereafter. This overall increase in net income highlights improved profitability and operational efficiency despite the challenging expense environment.

Summary of Key Financial Trends: Steady revenue growth driven primarily by franchised restaurants.; Variable but overall increased expenses across most categories.; Consistent improvement in gross margin and operating income.; Significant impairment charges in 2022 impacting operating income temporarily.; Gradual increase in interest expenses, suggesting higher financial costs.; Strong growth in net income over the five-year span, with recovery after the 2022 dip.

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McDonald’s Corp. (NYSE:MCD)

Income Statement