McDonald's Corp. is facing significant challenges as it aims to revitalize its stock price, which has dropped almost 31% from its peak in February, marking its worst annual performance since 2002. The company is grappling with the perception that its menu is too expensive for cost-conscious diners.
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During an investor day event earlier this week, McDonald's projected "slightly negative" US sales for the current quarter. Last quarter, sales increased by just 0.8%, the slowest growth in over a year. Customers have expressed dissatisfaction over rising menu prices and the reduced in-store experience following the elimination of playgrounds and other popular elements.
Attempts to introduce value offerings have received mixed feedback, while a recently announced $8.5 billion multiyear initiative aimed at enhancing service and food quality has raised concerns about potential profit erosion, leading to further stock sell-offs. Jacob Aiken-Phillips of Melius Research, the only analyst with a "sell" rating on McDonald's, noted, "Their prices have gone up substantially, and it's no longer viewed as the best value in food." He pointed out that cheaper alternatives, such as Texas Roadhouse, offer a more appealing dining experience.
In response to criticism of their pricing, a McDonald's spokesperson emphasized the company's commitment to improving the US business by the end of 2026. In 2024, McDonald's addressed social media complaints about high prices, clarifying that a widely shared image showing an $18 Big Mac meal came from just one location out of over 13,700 nationwide. That year also saw the introduction of $5 meal deals to counter perceptions of rising costs. According to The Economist's Big Mac Index, the price of the sandwich in the US increased by approximately 23% from 2019 to the end of 2025. Price hikes began after the pandemic to manage surging costs for ingredients, labor, and fuel.