Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Long-term Activity Ratios (Summary)
McDonald’s Corp., long-term (investment) activity ratios
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).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio exhibited an upward trend from 0.77 in 2020 to 0.94 in 2021, indicating improved efficiency in utilizing fixed assets. A slight decline occurred in 2022 to 0.92, but the ratio recovered and stabilized at 0.95 in both 2023 and 2024, suggesting consistency in fixed asset performance during the latter years.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- This broader measure of fixed asset utilization showed a continuous gradual increase over the five-year period, rising from 0.50 in 2020 to 0.67 in 2024. The steady improvement indicates enhanced efficiency when factoring in leased assets, reflecting potentially better management or growth in asset usage related to leased property.
- Total Asset Turnover
- Total asset turnover demonstrated a generally positive trend, increasing from 0.36 in 2020 to 0.43 in 2021 and further to 0.46 in 2022. There was a minor decrease to 0.45 in 2023, followed by a rise to 0.47 in 2024. This pattern suggests gradual improvement in how effectively the company uses all its assets to generate revenue, with slight fluctuations reflecting operational variances.
- Equity Turnover
- Data for equity turnover was not available, limiting the ability to analyze this specific aspect of financial efficiency.
Net Fixed Asset Turnover
McDonald’s Corp., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | 25,920) | 25,494) | 23,183) | 23,223) | 19,208) | |
| Net property and equipment, including finance lease right-of-use asset | 27,315) | 26,698) | 25,287) | 24,721) | 24,958) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 0.95 | 0.95 | 0.92 | 0.94 | 0.77 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Airbnb Inc. | 75.52 | 61.98 | 69.41 | 38.27 | 12.50 | |
| Booking Holdings Inc. | 28.53 | 27.25 | 25.55 | 13.33 | 8.99 | |
| Chipotle Mexican Grill Inc. | 4.73 | 4.55 | 4.43 | 4.27 | 3.78 | |
| Starbucks Corp. | 4.17 | 4.87 | 4.92 | 4.56 | 3.77 | |
| Net Fixed Asset Turnover, Sector | ||||||
| Consumer Services | 2.75 | 2.76 | 2.59 | 2.27 | 1.74 | |
| Net Fixed Asset Turnover, Industry | ||||||
| Consumer Discretionary | 3.22 | 3.50 | 3.47 | 3.31 | 3.37 | |
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).
1 2024 Calculation
Net fixed asset turnover = Revenues ÷ Net property and equipment, including finance lease right-of-use asset
= 25,920 ÷ 27,315 = 0.95
2 Click competitor name to see calculations.
The financial data over the five-year period reveals several important trends regarding the company's operational scale and efficiency. Revenues have displayed a consistent upward trajectory, increasing from $19,208 million in 2020 to $25,920 million by the end of 2024. This represents a steady growth in sales over the period, with the most notable jump occurring between 2023 and 2024, albeit the increase is more moderate compared to the prior years.
Regarding the company's investment in fixed assets, the net property and equipment, including finance lease right-of-use assets, showed modest fluctuations initially, starting at $24,958 million in 2020 and slightly declining to $24,721 million in 2021. Subsequently, an increasing trend is observed, with the figure rising to $27,315 million by the end of 2024. This suggests gradual asset base expansion or reinvestment into property and equipment, supporting ongoing operations or future growth.
The net fixed asset turnover ratio, which indicates how efficiently the company is using its fixed assets to generate revenue, improved from 0.77 in 2020 to 0.94 in 2021. This highlights a significant increase in operational efficiency or asset utilization during that year. The ratio remained relatively stable around 0.92 to 0.95 in the following years through 2024, indicating consistent efficiency in generating revenues from the fixed asset base after the initial improvement.
- Revenues
- Consistent growth from $19,208 million in 2020 to $25,920 million in 2024, with steady annual increases.
- Net property and equipment
- Initial slight decline in 2021 followed by progressive increase to $27,315 million in 2024, indicating asset expansion.
- Net fixed asset turnover
- Marked improvement from 0.77 to 0.94 between 2020 and 2021, then stable efficiency around 0.92–0.95 through 2024.
Overall, the data points to a company experiencing revenue growth supported by a gradually expanding asset base, while maintaining enhanced and stable efficiency in the use of fixed assets to generate sales over the period analyzed.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
McDonald’s Corp., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | 25,920) | 25,494) | 23,183) | 23,223) | 19,208) | |
| Net property and equipment, including finance lease right-of-use asset | 27,315) | 26,698) | 25,287) | 24,721) | 24,958) | |
| Operating lease right-of-use asset, net | 11,319) | 11,724) | 11,052) | 13,552) | 13,828) | |
| Net property and equipment, including finance lease right-of-use asset (including operating lease, right-of-use asset) | 38,634) | 38,422) | 36,339) | 38,273) | 38,786) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 0.67 | 0.66 | 0.64 | 0.61 | 0.50 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Airbnb Inc. | 38.15 | 35.54 | 32.43 | 13.98 | 5.16 | |
| Booking Holdings Inc. | 17.07 | 14.35 | 13.01 | 8.31 | 5.29 | |
| Chipotle Mexican Grill Inc. | 1.77 | 1.72 | 1.64 | 1.54 | 1.38 | |
| Starbucks Corp. | 2.02 | 2.28 | 2.21 | 1.99 | 1.64 | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Consumer Services | 1.67 | 1.66 | 1.55 | 1.29 | 0.99 | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Consumer Discretionary | 2.51 | 2.68 | 2.66 | 2.51 | 2.57 | |
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).
1 2024 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenues ÷ Net property and equipment, including finance lease right-of-use asset (including operating lease, right-of-use asset)
= 25,920 ÷ 38,634 = 0.67
2 Click competitor name to see calculations.
The financial data reveals several notable trends over the five-year period under review.
- Revenues
- Revenues experienced a consistent upward trend from 2020 through 2024. Starting at $19,208 million in 2020, revenues increased substantially to $23,223 million in 2021, followed by a slight decrease to $23,183 million in 2022. Subsequently, revenues resumed growth, reaching $25,494 million in 2023 and further rising to $25,920 million in 2024. This pattern indicates an overall strengthening in sales, despite a minor dip in 2022.
- Net Property and Equipment, Including Finance Lease Right-of-Use Asset
- The net value of property and equipment, inclusive of finance lease and operating lease right-of-use assets, showed a fluctuating pattern with a general slight decline. Beginning at $38,786 million in 2020, the value decreased gradually to $38,273 million in 2021 and further declined to $36,339 million in 2022. In 2023 and 2024, the values rebounded somewhat to $38,422 million and $38,634 million respectively, suggesting reinvestment or asset revaluation activities after prior reductions.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- The turnover ratio exhibited a consistent upward trend throughout the period. Starting from 0.5 in 2020, the ratio improved annually to 0.61 in 2021, 0.64 in 2022, 0.66 in 2023, and reaching 0.67 in 2024. This indicates increasingly efficient use of net fixed assets to generate revenues over time, reflecting improved operational productivity or asset management.
Overall, the data indicates positive growth in revenue generation combined with an improving efficiency in asset utilization. The fluctuations in net property and equipment suggest periods of asset optimization or changes in asset base management. Despite some volatility in asset values, the firm appears to leverage its asset base more effectively to drive sales growth.
Total Asset Turnover
McDonald’s Corp., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | 25,920) | 25,494) | 23,183) | 23,223) | 19,208) | |
| Total assets | 55,182) | 56,147) | 50,436) | 53,854) | 52,627) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.47 | 0.45 | 0.46 | 0.43 | 0.36 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Airbnb Inc. | 0.53 | 0.48 | 0.52 | 0.44 | 0.32 | |
| Booking Holdings Inc. | 0.86 | 0.88 | 0.67 | 0.46 | 0.31 | |
| Chipotle Mexican Grill Inc. | 1.23 | 1.23 | 1.25 | 1.13 | 1.00 | |
| Starbucks Corp. | 1.15 | 1.22 | 1.15 | 0.93 | 0.80 | |
| Total Asset Turnover, Sector | ||||||
| Consumer Services | 0.75 | 0.74 | 0.71 | 0.59 | 0.49 | |
| Total Asset Turnover, Industry | ||||||
| Consumer Discretionary | 0.94 | 0.97 | 0.96 | 0.88 | 0.84 | |
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).
1 2024 Calculation
Total asset turnover = Revenues ÷ Total assets
= 25,920 ÷ 55,182 = 0.47
2 Click competitor name to see calculations.
The financial data over the five-year period reveals several notable trends regarding the company’s revenues, total assets, and total asset turnover.
- Revenues
- The revenue figures show a consistent upward trend, increasing from $19,208 million in 2020 to $25,920 million in 2024. There is a slight decline between 2021 and 2022, but this is marginal and followed by a rebound in subsequent years, indicating overall growth in operating performance and sales.
- Total Assets
- Total assets exhibit some variability over the years. After a slight increase from $52,627 million in 2020 to $53,854 million in 2021, assets decreased notably to $50,436 million in 2022. This reduction was followed by a recovery to $56,147 million in 2023, before declining slightly again to $55,182 million in 2024. The fluctuations suggest active asset management and possible disposals or investments impacting the asset base.
- Total Asset Turnover
- The total asset turnover ratio improves steadily from 0.36 in 2020 to 0.47 in 2024. This ratio measures efficiency in using assets to generate revenues. The increasing trend indicates enhanced operational efficiency, with the company generating more revenue per unit of asset over time, despite the fluctuations in total assets.
Overall, the data suggests positive momentum in revenue growth supported by increasing efficiency in asset utilization. While total assets have experienced some volatility, the firm appears to have managed its asset base effectively to improve turnover and generate higher sales.
Equity Turnover
McDonald’s Corp., equity turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | 25,920) | 25,494) | 23,183) | 23,223) | 19,208) | |
| Shareholders’ equity (deficit) | (3,797) | (4,707) | (6,003) | (4,601) | (7,825) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | — | — | — | — | — | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Airbnb Inc. | 1.32 | 1.21 | 1.51 | 1.25 | 1.16 | |
| Booking Holdings Inc. | — | — | 6.14 | 1.77 | 1.39 | |
| Chipotle Mexican Grill Inc. | 3.09 | 3.22 | 3.65 | 3.29 | 2.96 | |
| Starbucks Corp. | — | — | — | — | — | |
| Equity Turnover, Sector | ||||||
| Consumer Services | — | — | — | 23.06 | — | |
| Equity Turnover, Industry | ||||||
| Consumer Discretionary | 3.24 | 3.86 | 4.21 | 3.74 | 4.82 | |
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).
1 2024 Calculation
Equity turnover = Revenues ÷ Shareholders’ equity (deficit)
= 25,920 ÷ -3,797 = —
2 Click competitor name to see calculations.
The financial data reveals several notable trends over the five-year period ending in 2024. Revenues demonstrate a consistent upward trajectory, increasing from 19,208 million US dollars in 2020 to 25,920 million US dollars in 2024. This reflects a steady growth in the company's top-line performance with only a slight dip between 2021 and 2022, after which revenues resumed their growth pattern.
In contrast, shareholders' equity remains negative throughout the same period, indicating a deficit position. The deficit showed some improvement from -7,825 million US dollars in 2020 to -3,797 million US dollars in 2024, with fluctuations observed in intermediate years. This movement suggests efforts to reduce the equity deficit, although it remains a significant financial concern. The deficit decreased notably between 2020 and 2021, worsened somewhat in 2022, but improved again in the most recent years.
The absence of equity turnover data precludes analysis of how efficiently the company is utilizing its equity base relative to revenues.
- Revenues
- Exhibit steady growth from 19.2 billion US dollars in 2020 to nearly 26 billion US dollars in 2024.
- Shareholders’ Equity (Deficit)
- Consistently negative, showing improvement but still indicating a deficit of approximately 3.8 billion US dollars by 2024.
- Equity Turnover
- Data not available, limiting assessment of capital efficiency.