The Revenue LinesWide moat

McDonald's (MCD) — moat facet

Two landlord segments earn 98% of the profit; the licensed third holds nearly half the restaurants and books 9% of the revenue.

McDonald's reports three segments, and they are not three regions so much as three depths of the same business. In 2025 the United States had revenue of $10,825 million and operating income of $5,808 million; the International Operated Markets $13,633 million and $6,382 million; and International Developmental Licensed Markets & Corporate $2,427 million and $203 million 1. Two segments earn 98% of the operating income. The third holds 20,805 of the 45,356 restaurants in the system 2, 46% of them, and books 9% of the revenue 3.

Franchised revenue per dollar of franchised sales, 2025 (cents)International Operated Markets17.2cUnited States14.2cLicensed markets5.4cMcDonald's Form 10-K FY2025; franchised revenues / franchised sales by segment
Where McDonald's owns the corner it collects rent as well as a royalty; where it does not, a third as much.

The reason is what McDonald's owns in each. In the United States and the operated markets it usually owns or leases the land and the building, so the franchisee pays rent as well as a royalty. In the licensed markets the licensee owns the real estate and pays a royalty only 4. Measured as franchised revenue per dollar of franchised sales, McDonald's collected about 14.2 cents in the United States, 17.2 cents in the operated markets and 5.4 cents in the licensed markets in 2025 5. The same hamburger, sold under the same arches, is worth three different amounts to the company depending on who owns the corner.

Growth has run in a different order from size. From 2019 to 2025, on the restated basis McDonald's now reports, revenue compounded at about 5.2% a year in the United States, 2.9% in the operated markets and 4.3% in the licensed segment 6. The operated markets lost a year to the pandemic and another to the Russia exit, which cost $1,281 million of pre-tax charges in 2022 7. Those two setbacks are why the largest segment has grown slowest.

The third segment's thin profit is partly an accounting choice. It carries the corporate costs: $1,682 million of the company's $3,039 million of selling, general and administrative expense sat there in 2025 8. Its franchised margins alone were $1,897 million 9.

The leaves follow the chart's bands: the United States, the International Operated Markets, and the licensed markets with Corporate. Where a page already covers a subject, such as the rent model under Real Estate & the Landlord Model or the franchisee support under Franchisee Relations Can Turn Tense, the leaves point to it rather than repeat it. The test of the three together is whether the two landlord segments keep earning above 45% while the licensed estate keeps adding more than a thousand restaurants a year.

Moat trajectory: Holding steady

Operating income by segment grew 3%, 5% and fell in the June 2026 quarter; the mix barely moved.

The number that tests this moat
Moat Explorer calc
Share of operating income from the two landlord segments
98% in 2025 ($12,190m of $12,393m)

The licensed segment's growth in restaurants has not yet shown up as profit; a rising share for it would.

How it's calculated: (U.S. 5,808 + IOM 6,382) / 12,393
Source: McDonald's Form 10-K FY2025, segment note ↗
Dig deeper
DIG DEEPER 01
United States
A 54% margin on a market adding almost no restaurants: a toll road whose traffic is now falling.
DIG DEEPER 02
International Operated Markets
The largest segment, twice knocked back, now carrying most of the company's capital spending.
DIG DEEPER 03
International Developmental Licensed & Corporate
The purest royalty business McDonald's has, with the head office's costs stacked on top of it.
References
  1. ReportedIn 2025 the United States had revenue of $10,825 million and operating income of $5,808 million; the International Operated Markets $13,633 million and $6,382 million; and International Developmental Licensed Markets & Corporate $2,427 million and $203 million .
    McDonald's Form 10-K FY2025 - segment note (revenue, operating income, SG&A, assets and capital expenditures by segment, 2023-2025); franchised and company-operated revenues, franchised margins and franchised sales by segment; comparable sales and restaurants by segment — FY2023-FY2025 · publ. February 2026 · source ↗
  2. ReportedThe third holds 20,805 of the 45,356 restaurants in the system , 46% of them, and books 9% of the revenue .
    McDonald's Form 10-K FY2025 - segment note (revenue, operating income, SG&A, assets and capital expenditures by segment, 2023-2025); franchised and company-operated revenues, franchised margins and franchised sales by segment; comparable sales and restaurants by segment — FY2023-FY2025 · publ. February 2026 · source ↗
  3. Moat Explorer calcThe third holds 20,805 of the 45,356 restaurants in the system , 46% of them, and books 9% of the revenue .
    Moat Explorer calculation from McDonald's Forms 10-K FY2019-FY2025 and Q2 2026 filings: segment shares, margins, growth rates and franchised revenue per dollar of franchised sales — FY2019 to Q2 2026 · publ. 2026-09-23 · source ↗
  4. ReportedIn the licensed markets the licensee owns the real estate and pays a royalty only .
    McDonald's Form 10-K FY2025 - segment note (revenue, operating income, SG&A, assets and capital expenditures by segment, 2023-2025); franchised and company-operated revenues, franchised margins and franchised sales by segment; comparable sales and restaurants by segment — FY2023-FY2025 · publ. February 2026 · source ↗
  5. Moat Explorer calcMeasured as franchised revenue per dollar of franchised sales, McDonald's collected about 14.2 cents in the United States, 17.2 cents in the operated markets and 5.4 cents in the licensed markets in 2025 .
    Moat Explorer calculation from McDonald's Forms 10-K FY2019-FY2025 and Q2 2026 filings: segment shares, margins, growth rates and franchised revenue per dollar of franchised sales — FY2019 to Q2 2026 · publ. 2026-09-23 · source ↗
  6. Moat Explorer calcFrom 2019 to 2025, on the restated basis McDonald's now reports, revenue compounded at about 5.2% a year in the United States, 2.9% in the operated markets and 4.3% in the licensed segment .
    Moat Explorer calculation from McDonald's Forms 10-K FY2019-FY2025 and Q2 2026 filings: segment shares, margins, growth rates and franchised revenue per dollar of franchised sales — FY2019 to Q2 2026 · publ. 2026-09-23 · source ↗
  7. ReportedThe operated markets lost a year to the pandemic and another to the Russia exit, which cost $1,281 million of pre-tax charges in 2022 .
    McDonald's Form 10-K FY2023 - segment operating income 2021-2023; $1,281 million of pre-tax charges on the sale of the Russia business in 2022 and 855 restaurant closures — FY2021-FY2023 · publ. February 2024 · source ↗
  8. ReportedIt carries the corporate costs: $1,682 million of the company's $3,039 million of selling, general and administrative expense sat there in 2025 .
    McDonald's Form 10-K FY2025 - segment note (revenue, operating income, SG&A, assets and capital expenditures by segment, 2023-2025); franchised and company-operated revenues, franchised margins and franchised sales by segment; comparable sales and restaurants by segment — FY2023-FY2025 · publ. February 2026 · source ↗
  9. ReportedIts franchised margins alone were $1,897 million .
    McDonald's Form 10-K FY2025 - segment note (revenue, operating income, SG&A, assets and capital expenditures by segment, 2023-2025); franchised and company-operated revenues, franchised margins and franchised sales by segment; comparable sales and restaurants by segment — FY2023-FY2025 · publ. February 2026 · source ↗
Sources
Generated September 23, 2026