10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended	June 30, 2021

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from             to

Commission File Number 1-5231

McDONALD’S CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Delaware		36-2361282
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)
110 North Carpenter Street		60607
Chicago,	Illinois
(Address of Principal Executive Offices)		(Zip Code)

(630) 623-3000

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	MCD	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☒  No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☒  No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☒	Accelerated Filer	☐
Non-accelerated Filer	☐	Smaller Reporting Company	☐
Emerging Growth Company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐  No  ☒

746,798,875

(Number of shares of common stock

outstanding as of 6/30/2021)

McDONALD’S CORPORATION

___________________________

INDEX

_______

	Page Reference
Part I. Financial Information
Item 1 – Financial Statements
Condensed Consolidated Balance Sheet, June 30, 2021 (unaudited) and December 31, 2020	3
Condensed Consolidated Statement of Income (unaudited), quarters and six months ended June 30, 2021 and 2020	4
Condensed Consolidated Statement of Comprehensive Income (unaudited), quarters and six months ended June 30, 2021 and 2020	5
Condensed Consolidated Statement of Cash Flows (unaudited), quarters and six months ended June 30, 2021 and 2020	6
Condensed Consolidated Statement of Shareholders' Equity (unaudited), quarters and six months ended June 30, 2021 and 2020	7
Notes to Condensed Consolidated Financial Statements (unaudited)	9
Item 2 – Management's Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3 – Quantitative and Qualitative Disclosures About Market Risk	38
Item 4 – Controls and Procedures	38
Part II. Other Information
Item 1 – Legal Proceedings	39
Item 1A – Risk Factors	39
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 6 – Exhibits	40
Signature	43

All trademarks used herein are the property of their respective owners and are used with permission.

2

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEET
	(unaudited)
In millions, except per share data	June 30, 2021		December 31, 2020
Assets
Current assets
Cash and equivalents	$	3,049.4	$	3,449.1
Accounts and notes receivable	1,808.3		2,110.3
Inventories, at cost, not in excess of market	47.8		51.1
Prepaid expenses and other current assets	795.7		632.7
Total current assets	5,701.2		6,243.2
Other assets
Investments in and advances to affiliates	1,196.8		1,297.2
Goodwill	2,778.1		2,773.1
Miscellaneous	3,889.5		3,527.4
Total other assets	7,864.4		7,597.7
Lease right-of-use asset, net	13,707.3		13,827.7
Property and equipment
Property and equipment, at cost	41,535.5		41,476.5
Accumulated depreciation and amortization	(16,915.3)		(16,518.3)
Net property and equipment	24,620.2		24,958.2
Total assets	$	51,893.1	$	52,626.8
Liabilities and shareholders’ equity
Current liabilities
Accounts payable	730.9		741.3
Lease liability	720.4		701.5
Income taxes	281.4		741.1
Other taxes	241.2		227.0
Accrued interest	323.8		388.4
Accrued payroll and other liabilities	1,137.1		1,138.3
Current maturities of long-term debt	500.0		2,243.6
Total current liabilities	3,934.8		6,181.2
Long-term debt	34,922.6		35,196.8
Long-term lease liability	13,119.0		13,321.3
Long-term income taxes	1,865.2		1,970.7
Deferred revenues - initial franchise fees	714.9		702.0
Other long-term liabilities	1,077.2		1,054.1
Deferred income taxes	2,067.4		2,025.6
Shareholders’ equity (deficit)
Preferred stock, no par value; authorized – 165.0 million shares; issued – none	—		—
Common stock, $.01 par value; authorized – 3.5 billion shares; issued – 1,660.6 million shares	16.6		16.6
Additional paid-in capital	8,046.0		7,903.6
Retained earnings	55,739.0		53,908.1
Accumulated other comprehensive income (loss)	(2,571.2)		(2,586.8)
Common stock in treasury, at cost; 913.8 and 915.2 million shares	(67,038.4)		(67,066.4)
Total shareholders’ equity (deficit)	(5,808.0)		(7,824.9)
Total liabilities and shareholders’ equity (deficit)	$	51,893.1	$	52,626.8

See Notes to condensed consolidated financial statements.

3

CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions, except per share data	2021		2020		2021		2020
Revenues
Sales by Company-operated restaurants	$	2,488.7	$	1,593.7	$	4,650.2	$	3,619.5
Revenues from franchised restaurants	3,306.2		2,088.0		6,183.6		4,696.0
Other revenues	93.0		79.8		178.7		160.4
Total revenues	5,887.9		3,761.5		11,012.5		8,475.9
Operating costs and expenses
Company-operated restaurant expenses	2,021.0		1,448.4		3,838.6		3,201.2
Franchised restaurants-occupancy expenses	579.1		524.5		1,150.6		1,078.7
Other restaurant expenses	68.3		63.3		135.5		128.8
Selling, general & administrative expenses
Depreciation and amortization	83.1		71.0		159.1		144.5
Other	572.4		576.0		1,062.8		1,092.3
Other operating (income) expense, net	(127.1)		117.2		(306.5)		175.7
Total operating costs and expenses	3,196.8		2,800.4		6,040.1		5,821.2
Operating income	2,691.1		961.1		4,972.4		2,654.7
Interest expense	296.5		319.1		596.5		599.1
Nonoperating (income) expense, net	18.6		(6.7)		47.2		(38.0)
Income before provision for income taxes	2,376.0		648.7		4,328.7		2,093.6
Provision for income taxes	156.7		164.9		572.2		502.9
Net income	$	2,219.3	$	483.8	$	3,756.5	$	1,590.7
Earnings per common share-basic	$	2.97	$	0.65	$	5.03	$	2.14
Earnings per common share-diluted	$	2.95	$	0.65	$	5.00	$	2.12
Dividends declared per common share	$	1.29	$	1.25	$	2.58	$	2.50
Weighted-average shares outstanding-basic	746.6		743.8		746.2		744.3
Weighted-average shares outstanding-diluted	752.1		748.6		751.6		749.6

See Notes to condensed consolidated financial statements.

4

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)
	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Net income	$	2,219.3	$	483.8	$	3,756.5	$	1,590.7
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments:
Gain (loss) recognized in accumulated other comprehensive income ("AOCI"), including net investment hedges	47.8		207.1		(39.9)		(259.1)
Reclassification of (gain) loss to net income	9.7		—		20.4		—
Foreign currency translation adjustments-net of tax benefit (expense) of $22.7, $66.1, ($67.6) and ($49.2)	57.5		207.1		(19.5)		(259.1)
Cash flow hedges:
Gain (loss) recognized in AOCI	(1.2)		(17.6)		21.9		(57.2)
Reclassification of (gain) loss to net income	13.4		(1.7)		28.4		(10.8)
Cash flow hedges-net of tax benefit (expense) of ($3.7), $5.8, ($14.9) and $20.5	12.2		(19.3)		50.3		(68.0)
Defined benefit pension plans:
Gain (loss) recognized in AOCI	0.1		(0.6)		0.8		(2.5)
Reclassification of (gain) loss to net income	(5.1)		2.9		(16.0)		6.0
Defined benefit pension plans-net of tax benefit (expense) of $0.1, $0.1, $0.1 and $0.5	(5.0)		2.3		(15.2)		3.5
Total other comprehensive income (loss), net of tax	64.7		190.1		15.6		(323.6)
Comprehensive income (loss)	$	2,284.0	$	673.9	$	3,772.1	$	1,267.1

See Notes to condensed consolidated financial statements.

5

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Operating activities
Net income	$	2,219.3	$	483.8	$	3,756.5	$	1,590.7
Adjustments to reconcile to cash provided by operations
Charges and credits:
Depreciation and amortization	463.4		425.7		917.3		847.0
Deferred income taxes	(368.9)		(42.1)		(370.4)		234.3
Share-based compensation	36.5		30.8		63.8		56.7
Other	(71.2)		119.2		(201.2)		31.3
Changes in working capital items	(545.9)		(1,230.5)		(308.8)		(1,427.1)
Cash provided by (used for) operations	1,733.2		(213.1)		3,857.2		1,332.9
Investing activities
Capital expenditures	(482.6)		(305.0)		(851.3)		(787.5)
Purchases of restaurant businesses	(49.4)		(23.7)		(88.1)		(43.3)
Sales of restaurant businesses	52.2		1.8		81.8		27.5
Sales of property	23.8		1.8		56.6		17.6
Other	42.5		(71.5)		142.9		(129.3)
Cash used for investing activities	(413.5)		(396.6)		(658.1)		(915.0)
Financing activities
Net short-term borrowings	1.4		(4.1)		7.9		107.7
Long-term financing issuances	—		0.8		—		5,540.2
Long-term financing repayments	(401.2)		(699.9)		(1,739.0)		(962.6)
Treasury stock purchases	(3.0)		(2.3)		(24.5)		(904.9)
Common stock dividends	(963.3)		(929.7)		(1,925.6)		(1,860.4)
Proceeds from stock option exercises	72.9		57.7		132.0		157.0
Other	(13.1)		(0.4)		(21.0)		(121.9)
Cash provided by (used for) financing activities	(1,306.3)		(1,577.9)		(3,570.2)		1,955.1
Effect of exchange rates on cash and cash equivalents	16.3		63.5		(28.6)		(15.8)
Cash and equivalents increase (decrease)	29.7		(2,124.1)		(399.7)		2,357.2
Cash and equivalents at beginning of period	3,019.7		5,379.8		3,449.1		898.5
Cash and equivalents at end of period	$	3,049.4	$	3,255.7	$	3,049.4	$	3,255.7

See Notes to condensed consolidated financial statements.

6

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
For the six months ended June 30, 2020
	Common stock issued										Accumulated other comprehensive income (loss)								Common stock in treasury			Total shareholders’ equity (deficit)
					Additional paid-in capital			Retained earnings		Pensions			Cash flow hedges			Foreign currency translation
In millions, except per share data	Shares	Amount																	Shares	Amount
Balance at December 31, 2019	1,660.6		$	16.6		$	7,653.9	$	52,930.5		$	(243.7)		$	12.0		$	(2,251.0)	(914.3)	$	(66,328.6)		$	(8,210.3)
Net income								1,590.7															1,590.7
Other comprehensive income (loss),     net of tax											3.5			(68.0)			(259.1)						(323.6)
Comprehensive income																							1,267.1
Common stock cash dividends     ($2.50 per share)								(1,860.4)															(1,860.4)
Treasury stock purchases																			(4.3)	(871.2)			(871.2)
Share-based compensation						56.7																	56.7
Stock option exercises and other						69.4													2.1	85.6			155.0
Balance at June 30, 2020	1,660.6		$	16.6		$	7,780.0	$	52,660.8		$	(240.2)		$	(56.0)		$	(2,510.1)	(916.5)	$	(67,114.2)		$	(9,463.1)

For the six months ended June 30, 2021
	Common stock issued										Accumulated other comprehensive income (loss)								Common stock in treasury			Total shareholders’ equity (deficit)
					Additional paid-in capital			Retained earnings		Pensions			Cash flow hedges			Foreign currency translation
In millions, except per share data	Shares	Amount																	Shares	Amount
Balance at December 31, 2020	1,660.6		$	16.6		$	7,903.6	$	53,908.1		$	(287.6)		$	(111.3)		$	(2,187.9)	(915.2)	$	(67,066.4)		$	(7,824.9)
Net income								3,756.5															3,756.5
Other comprehensive income (loss),     net of tax											(15.2)			50.3			(19.5)						15.6
Comprehensive income																							3,772.1
Common stock cash dividends     ($2.58 per share)								(1,925.6)															(1,925.6)
Treasury stock purchases																			(0.1)	(24.5)			(24.5)
Share-based compensation						63.8																	63.8
Stock option exercises and other						78.6													1.5	52.5			131.1
Balance at June 30, 2021	1,660.6		$	16.6		$	8,046.0	$	55,739.0		$	(302.8)		$	(61.0)		$	(2,207.4)	(913.8)	$	(67,038.4)		$	(5,808.0)

See Notes to condensed consolidated financial statements.

7

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
For the quarter ended June 30, 2020
	Common stock issued										Accumulated other comprehensive income (loss)								Common stock in treasury			Total shareholders’ equity (deficit)
					Additional paid-in capital			Retained earnings		Pensions			Cash flow hedges			Foreign currency translation
In millions, except per share data	Shares	Amount																	Shares	Amount
Balance at March 31, 2020	1,660.6		$	16.6		$	7,713.5	$	53,106.7		$	(242.5)		$	(36.7)		$	(2,717.2)	(917.1)	$	(67,133.8)		$	(9,293.4)
Net income								483.8															483.8
Other comprehensive income (loss),     net of tax											2.3			(19.3)			207.1						190.1
Comprehensive income																							673.9
Common stock cash dividends     ($1.25 per share)								(929.7)															(929.7)
Treasury stock purchases																			(0.1)	(2.3)			(2.3)
Share-based compensation						30.8																	30.8
Stock option exercises and other						35.7													0.7	21.9			57.6
Balance at June 30, 2020	1,660.6		$	16.6		$	7,780.0	$	52,660.8		$	(240.2)		$	(56.0)		$	(2,510.1)	(916.5)	$	(67,114.2)		$	(9,463.1)

For the quarter ended June 30, 2021
	Common stock issued										Accumulated other comprehensive income (loss)								Common stock in treasury			Total shareholders’ equity (deficit)
					Additional paid-in capital			Retained earnings		Pensions			Cash flow hedges			Foreign currency translation
In millions, except per share data	Shares	Amount																	Shares	Amount
Balance at March 31, 2021	1,660.6		$	16.6		$	7,959.1	$	54,483.0		$	(297.8)		$	(73.2)		$	(2,264.9)	(914.5)	$	(67,058.3)		$	(7,235.5)
Net income								2,219.3															2,219.3
Other comprehensive income (loss),     net of tax											(5.0)			12.2			57.5						64.7
Comprehensive income																							2,284.0
Common stock cash dividends     ($1.29 per share)								(963.3)															(963.3)
Treasury stock purchases																			—	(3.0)			(3.0)
Share-based compensation						36.5																	36.5
Stock option exercises and other						50.4													0.7	22.9			73.3
Balance at June 30, 2021	1,660.6		$	16.6		$	8,046.0	$	55,739.0		$	(302.8)		$	(61.0)		$	(2,207.4)	(913.8)	$	(67,038.4)		$	(5,808.0)

See Notes to condensed consolidated financial statements.

8

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

McDonald’s Corporation, the registrant, together with its subsidiaries, is referred to herein as the "Company." The Company, its franchisees and suppliers, are referred to herein as the "System."

Basis of Presentation

The accompanying condensed consolidated financial statements should be read in conjunction with the Consolidated Financial Statements contained in the Company’s December 31, 2020 Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation have been included. The results for the quarter and six months ended June 30, 2021 do not necessarily indicate the results that may be expected for the full year.

Restaurant Information

The following table presents restaurant information by ownership type:

Restaurants at June 30,	2021	2020
Conventional franchised	21,519	21,822
Developmental licensed	7,753	7,685
Foreign affiliated	7,445	6,864
Total Franchised	36,717	36,371
Company-operated	2,679	2,649
Total Systemwide restaurants	39,396	39,020

The results of operations of restaurant businesses purchased and sold in transactions with franchisees were not material either individually or in the aggregate to the condensed consolidated financial statements for the periods prior to purchase and sale.

Per Common Share Information

Diluted earnings per common share is calculated using net income divided by diluted weighted-average shares. Diluted weighted-average shares include weighted-average shares outstanding plus the dilutive effect of share-based compensation, calculated using the treasury stock method, of 5.5 million shares and 4.8 million shares for the quarters 2021 and 2020, respectively, and 5.4 million shares and 5.3 million shares for the six months 2021 and 2020, respectively. Share-based compensation awards that would have been antidilutive, and therefore were not included in the calculation of diluted weighted-average shares, totaled 3.0 million shares and 2.8 million shares for the quarters 2021 and 2020, respectively, and 3.0 million shares and 2.8 million shares for the six months 2021 and 2020, respectively.

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Income Taxes

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”), which simplifies the accounting for income taxes. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, including applicable interim periods. The Company adopted the new standard effective January 1, 2021. The adoption of the standard did not have a material impact on the Company's condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

Reference Rate Reform

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" (“ASU 2020-04”). The pronouncement provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate and other interbank offered rates to alternative reference rates. The guidance was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The adoption of ASU 2020-04 will not have a material impact on the Company's condensed consolidated financial statements.

9

Income Taxes

The effective income tax rate was 6.6% and 25.4% for the quarters ended 2021 and 2020, respectively, and 13.2% and 24.0% for the six months ended 2021 and 2020, respectively. The tax rate for the quarter and six months ended 2021 included a benefit of $364 million related to the remeasurement of deferred taxes as a result of a change in the U.K. statutory income tax rate.

Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value. Fair value disclosures are reflected in a three-level hierarchy, maximizing the use of observable inputs and minimizing the use of unobservable inputs. The Company did not have any significant changes to the valuation techniques used to measure fair value as described in the Company's December 31, 2020 Annual Report on Form 10-K.

At June 30, 2021, the fair value of the Company’s debt obligations was estimated at $40.3 billion, compared to a carrying amount of $35.4 billion. The fair value was based upon quoted market prices, Level 2 within the valuation hierarchy. The carrying amounts of cash and equivalents and notes receivable approximate fair value.

10

Financial Instruments and Hedging Activities

The Company is exposed to global market risks, including the effect of changes in interest rates and foreign currency fluctuations. The Company uses foreign currency denominated debt and derivative instruments to mitigate the impact of these changes. The Company does not hold or issue derivatives for trading purposes.

The following table presents the fair values of derivative instruments included on the Condensed Consolidated Balance Sheet:

	Derivative Assets					Derivative Liabilities
In millions	Balance Sheet Classification	June 30, 2021		December 31, 2020		Balance Sheet Classification	June 30, 2021		December 31, 2020
Derivatives designated as hedging instruments
Foreign currency	Prepaid expenses and other current assets	$	14.8			Accrued payroll and other liabilities	$	(24.4)	$	(64.5)
Interest rate	Prepaid expenses and other current assets	4.0				Accrued payroll and other liabilities
Foreign currency	Miscellaneous other assets	24.7		$	5.6	Other long-term liabilities	(0.3)		(15.0)
Interest rate	Miscellaneous other assets	21.7		35.8		Other long-term liabilities
Total derivatives designated as hedging instruments		$	65.2	$	41.4		$	(24.7)	$	(79.5)
Derivatives not designated as hedging instruments
Equity	Prepaid expenses and other current assets	$	202.1	$	185.6	Accrued payroll and other liabilities	$	—	$	(8.6)
Foreign currency	Prepaid expenses and other current assets					Accrued payroll and other liabilities	(4.9)		(9.4)
Equity	Miscellaneous other assets
Total derivatives not designated as hedging instruments		$	202.1	$	185.6		$	(4.9)	$	(18.0)
Total derivatives		$	267.3	$	227.0		$	(29.6)	$	(97.5)

    The following table presents the pre-tax amounts from derivative instruments affecting income and AOCI for the six months ended June 30, 2021 and 2020, respectively:

	Location of Gain or Loss Recognized in Income on Derivative	Gain (Loss) Recognized in AOCI				Gain (Loss) Reclassified into Income from AOCI				Gain (Loss) Recognized in Income on Derivative
In millions		2021		2020		2021		2020		2021		2020
Foreign currency	Nonoperating income/expense	$	28.4	$	16.4	$	(33.7)	$	16.4
Interest rate	Interest expense			(90.8)		(3.1)		(2.3)
Cash flow hedges		$	28.4	$	(74.4)	$	(36.8)	$	14.1
Foreign currency denominated debt	Nonoperating income/expense	$	274.0	$	91.3	$	32.4
Foreign currency derivatives	Nonoperating income/expense	26.5		15.0
Foreign currency derivatives(1)	Interest expense									$	7.3	$	7.3
Net investment hedges		$	300.5	$	106.3	$	32.4			$	7.3	$	7.3
Foreign currency	Nonoperating income/expense									$	4.5	$	(10.9)
Equity	Selling, general & administrative expenses									43.7		(23.6)
Equity	Other operating income/expense, net									(16.3)
Undesignated derivatives										$	31.9	$	(34.5)
(1)The amount of gain (loss) recognized in income related to components excluded from effectiveness testing.

11

Fair Value Hedges

The Company enters into fair value hedges to reduce the exposure to changes in fair values of certain liabilities. The Company enters into fair value hedges that convert a portion of its fixed rate debt into floating rate debt by use of interest rate swaps. At June 30, 2021, the carrying amount of fixed-rate debt that was effectively converted was $1.5 billion, which included an increase of $25.7 million of cumulative hedging adjustments. For the six months ended June 30, 2021, the Company recognized a $10.1 million loss on the fair value of interest rate swaps, and a corresponding gain on the fair value of the related hedged debt instrument to interest expense.

Cash Flow Hedges

The Company enters into cash flow hedges to reduce the exposure to variability in certain expected future cash flows. To protect against the reduction in value of forecasted foreign currency cash flows (such as royalties denominated in foreign currencies), the Company uses foreign currency forwards to hedge a portion of anticipated exposures. The hedges cover the next 18 months for certain exposures and are denominated in various currencies.

As of June 30, 2021, the Company had derivatives outstanding with an equivalent notional amount of $1.4 billion that hedged a portion of forecasted foreign currency denominated cash flows.

Based on market conditions at June 30, 2021, the $61.0 million in cumulative cash flow hedging losses, after tax, is not expected to have a significant effect on earnings over the next 12 months.

Net Investment Hedges

The Company primarily uses foreign currency denominated debt (third-party and intercompany) to hedge its investments in certain foreign subsidiaries and affiliates. Realized and unrealized translation adjustments from these hedges are included in shareholders' equity in the foreign currency translation component of Other comprehensive income ("OCI") and offset translation adjustments on the underlying net assets of foreign subsidiaries and affiliates, which also are recorded in OCI. As of June 30, 2021, $11.6 billion of the Company's third-party foreign currency denominated debt and $1.0 billion of the Company's intercompany foreign currency denominated debt was designated to hedge investments in certain foreign subsidiaries and affiliates.

Undesignated Derivatives

The Company enters into certain derivatives that are not designated for hedge accounting, therefore the changes in the fair value of these derivatives are recognized immediately in earnings together with the gain or loss from the hedged balance sheet position. As an example, the Company enters into equity derivative contracts, including total return swaps, to hedge market-driven changes in certain of its supplemental benefit plan liabilities. Changes in the fair value of these derivatives are recorded in Selling, general & administrative expenses together with the changes in the supplemental benefit plan liabilities. The Company may also use certain derivatives to mitigate the share price risk related to its sale of stock in McDonald’s Japan.  The changes in the fair value of the undesignated derivatives used for the most recent sale transaction were recognized immediately in earnings in Other Operating (income) expense, net. In addition, the Company uses foreign currency forwards to mitigate the change in fair value of certain foreign currency denominated assets and liabilities. The changes in the fair value of these derivatives are recognized in Nonoperating (income) expense, net, along with the currency gain or loss from the hedged balance sheet position.

Credit Risk

The Company is exposed to credit-related losses in the event of non-performance by its derivative counterparties. The Company did not have significant exposure to any individual counterparty at June 30, 2021 and has master agreements that contain netting arrangements. For financial reporting purposes, the Company presents gross derivative balances in the financial statements and supplementary data, including for counterparties subject to netting arrangements. Some of these agreements also require each party to post collateral if credit ratings fall below, or aggregate exposures exceed, certain contractual limits. At June 30, 2021, the Company was required to post an immaterial amount of collateral due to the negative fair value of certain derivative positions. The Company's counterparties were not required to post collateral on any derivative position, other than on certain hedges of the Company’s supplemental benefit plan liabilities where the counterparties were required to post collateral on their liability positions.

12

Franchise Arrangements

Revenues from franchised restaurants consisted of:

	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Rents	$	2,125.7	$	1,314.9	$	3,951.8	$	2,983.1
Royalties	1,167.8		762.0		2,206.5		1,690.8
Initial fees	12.7		11.1		25.3		22.1
Revenues from franchised restaurants	$	3,306.2	$	2,088.0	$	6,183.6	$	4,696.0

Segment Information

The Company operates under an organizational structure with the following global business segments reflecting how management reviews and evaluates operating performance:

•U.S. - the Company's largest market. The segment is 95% franchised as of June 30, 2021.

•International Operated Markets - comprised of markets or countries in which the Company operates and franchises restaurants, including Australia, Canada, France, Germany, Italy, the Netherlands, Russia, Spain and the U.K. The segment is 84% franchised as of June 30, 2021.

•International Developmental Licensed Markets & Corporate - comprised of primarily developmental licensee and affiliate markets in the McDonald’s system. Corporate activities are also reported in this segment. The segment is 98% franchised as of June 30, 2021.

The following table presents the Company’s revenues and operating income by segment:

	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Revenues
U.S.	$	2,278.8	$	1,758.6	$	4,354.3	$	3,629.6
International Operated Markets	3,078.7		1,612.5		5,634.9		4,016.8
International Developmental Licensed Markets & Corporate	530.4		390.4		1,023.3		829.5
Total revenues	$	5,887.9	$	3,761.5	$	11,012.5	$	8,475.9
Operating Income
U.S.	$	1,267.5	$	735.2	$	2,393.0	$	1,627.6
International Operated Markets	1,272.0		234.8		2,225.8		1,113.9
International Developmental Licensed Markets & Corporate *	151.6		(8.9)		353.6		(86.8)
Total operating income	$	2,691.1	$	961.1	$	4,972.4	$	2,654.7

*    Results included $98 million and $233 million for the quarter and six months, respectively, of net strategic gains primarily related to the sale of McDonald's Japan stock, which reduced the Company's total ownership by 3% for the quarter and 6% for the six months. As of June 30, 2021, the Company owned approximately 38% of McDonald's Japan. The proceeds were recorded within the other investing activities section of the Condensed Consolidated Statement of Cash Flows.

Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued and filed with the Securities and Exchange Commission. There were no subsequent events that required recognition or disclosure.

13

Item  2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

The Company franchises and operates McDonald’s restaurants, which serve a locally-relevant menu of quality food and beverages in 119 countries. Of the 39,396 restaurants at June 30, 2021, 36,717 were franchised, which is 93% of McDonald's restaurants.

The Company’s reporting segments are aligned with its strategic priorities and reflect how management reviews and evaluates operating performance. Significant reportable segments include the United States ("U.S.") and International Operated Markets. In addition, throughout this report we present the International Developmental Licensed Markets & Corporate segment, which includes markets in over 80 countries, as well as Corporate activities.

McDonald’s franchised restaurants are owned and operated under one of the following structures - conventional franchise, developmental license or affiliate. The optimal ownership structure for an individual restaurant, trading area or market (country) is based on a variety of factors, including the availability of individuals with entrepreneurial experience and financial resources, as well as the local, legal and regulatory environment in critical areas such as property ownership and franchising. The business relationship between McDonald’s and its independent franchisees is supported by adhering to standards and policies, including our newly defined Global Brand Standards, and is of fundamental importance to overall performance and to protecting the McDonald’s brand.

The Company is primarily a franchisor and believes franchising is paramount to delivering great-tasting food, locally relevant customer experiences and driving profitability. Franchising enables an individual to be their own employer and maintain control over all employment related matters, marketing and pricing decisions, while also benefiting from the strength of McDonald’s global brand, operating system and financial resources.

Directly operating McDonald’s restaurants contributes significantly to our ability to act as a credible franchisor. One of the strengths of the franchising model is that the expertise from operating Company-owned restaurants allows McDonald’s to improve the operations and success of all restaurants while innovations from franchisees can be tested and, when viable, efficiently implemented across relevant restaurants. Having Company-owned and operated restaurants provides Company personnel with a venue for restaurant operations training experience. In addition, in our Company-owned and operated restaurants, and in collaboration with franchisees, we are able to further develop and refine operating standards, marketing concepts and product and pricing strategies that will ultimately benefit McDonald’s restaurants.

The Company’s revenues consist of sales by Company-operated restaurants and fees from restaurants operated by franchisees. Fees vary by type of site, amount of Company investment, if any, and local business conditions. These fees, along with occupancy and operating rights, are stipulated in franchise/license agreements that generally have 20-year terms. The Company’s Other revenues are comprised of technology fees paid by franchisees, revenues from brand licensing arrangements and third-party revenues for the Dynamic Yield business.

COVID-19 resurgences throughout the quarter and six months have resulted in instances of government restrictions on restaurant operating hours, limited dine-in capacity and, in some cases, dining room closures. The Company has continued to follow the guidance of expert health authorities to apply the appropriate precautionary measures to protect the health and safety of our people and our customers and expects some operating restrictions in various markets so long as the COVID-19 pandemic continues.

Conventional Franchise

Under a conventional franchise arrangement, the Company generally owns or secures a long-term lease on the land and building for the restaurant location and the franchisee pays for equipment, signs, seating and décor. The Company believes that ownership of real estate, combined with the co-investment by franchisees, enables us to achieve restaurant performance levels that are among the highest in the industry.

Franchisees are responsible for reinvesting capital in their businesses over time. In addition, to accelerate implementation of certain initiatives, the Company may co-invest with franchisees to fund improvements to their restaurants or their operating systems. These investments, developed in collaboration with franchisees, are designed to cater to consumer preferences, improve local business performance and increase the value of our brand through the development of modernized, more attractive and higher revenue generating restaurants.

The Company requires franchisees to meet rigorous standards and generally does not work with passive investors. The business relationship with franchisees is designed to facilitate consistency and high quality at all McDonald’s restaurants. Conventional franchisees contribute to the Company’s revenue, primarily through the payment of rent and royalties based upon a percent of sales, with specified minimum rent payments, along with initial fees paid upon the opening of a new restaurant or grant of a new franchise. The Company's heavily franchised business model is designed to generate stable and predictable revenue, which is largely a function of franchisee sales, and resulting cash flow streams.

14

Developmental License or Affiliate

Under a developmental license or affiliate arrangement, licensees are responsible for operating and managing the business, providing capital (including the real estate interest) and developing and opening new restaurants. The Company generally does not invest any capital under a developmental license or affiliate arrangement, and it receives a royalty based on a percent of sales, and generally receives initial fees upon the opening of a new restaurant or grant of a new license.

While developmental license and affiliate arrangements are largely the same, affiliate arrangements are used in a limited number of foreign markets (primarily China and Japan) within the International Developmental Licensed Markets segment as well as a limited number of individual restaurants within the International Operated Markets segment, where the Company also has an equity investment and records its share of net results in Equity in earnings of unconsolidated affiliates.

15

Strategic Direction

In 2020, the Company announced the Accelerating the Arches (the “Strategy”) growth strategy. The Strategy encompasses all aspects of McDonald’s business as the leading global omni-channel restaurant brand, and includes a refreshed purpose, updated values, and growth pillars that build on the Company’s competitive advantages.

Purpose, Mission, & Values

Our values underpin our success and are at the very heart of our Strategy. The Company embraces and prioritizes its role and commitments to the communities in which it operates through our:

•Purpose to feed and foster communities,

•Mission to create delicious feel-good moments for everyone, and

•Core values that define who we are and how we run our business.

Growth Pillars

The growth pillars, rooted in the Company’s identity, MCD, build on historic strengths and articulate areas of further opportunity. Under the Strategy, the Company will:

•Maximize our Marketing by investing in new, culturally relevant approaches, such as our Famous Orders platform, to effectively communicate the story of our brand, food and purpose. This focuses on enhancing digital capabilities that provide a more personal connection with customers. The Company is also committed to a marketing strategy that highlights value at every tier of the menu, as affordability remains a cornerstone of the McDonald’s brand.

•Commit to the Core by tapping into customer demand for the familiar and focusing on serving delicious burgers, chicken and coffee. The Company is prioritizing chicken and beef offerings, as we expect they represent the largest growth opportunities. The Company recognizes there is significant opportunity to expand its chicken offerings by leveraging line extensions of customer favorites, such as the new Crispy Chicken Sandwich that launched in the U.S. at the end of February 2021. The Company is also implementing a series of operational and formulation changes designed to improve upon the great taste of our burgers. We also see a significant opportunity with coffee, and markets are leveraging the McCafe brand, experience, value and quality to drive long-term growth.

•Double Down on the 3D's: Digital, Delivery and Drive Thru by leveraging competitive strengths and building a powerful digital experience growth engine that provides a fast, easy experience for our customers. To unlock further growth, the Company is continuing to accelerate technology innovation so that, however customers choose to interact with McDonald’s, they can enjoy a fast, easy experience that meets their needs. In the first half of 2021, Systemwide sales from digital channels (which are comprised of the mobile app, delivery and kiosk) were nearly $8 billion across our top six markets, a 70% increase versus the first half of last year.

◦Digital: The Company’s digital experience growth engine, “MyMcDonald’s” is transforming its digital offerings across drive thru, takeaway, delivery, curbside pick-up and dine-in. Through the digital tools across this platform, customers receive tailored offers, can participate in a loyalty program and order and receive McDonald's food through the channel of their choice. The Company already has successful loyalty programs in many markets around the world. In July, the Company launched its loyalty program “MyMcDonald’s Rewards” in the U.S. and expects to launch in Germany and Canada before the end of 2021, followed by the U.K. and Australia in 2022.

◦Delivery: Over the past three years, the Company has expanded the number of McDonald’s restaurants offering delivery to nearly 32,000 or 80% of its restaurants, and delivery sales have grown significantly. The Company is building on this progress and enhancing the delivery experience for customers by adding the ability to order on the McDonald’s app, which is already available in several markets around the world, and optimizing operations with a focus on speed and accuracy.

◦Drive Thru: The Company has drive thru locations in over 25,000 restaurants globally, including nearly 95% of the over 13,000 locations in the U.S. This channel will remain of heightened importance and we expect that it will become even more critical to meet customers’ demand for flexibility and choice. The Company is building on its drive thru advantage, as the vast majority of new restaurant openings in the U.S. and International Operated Markets will include a drive thru.

The Company’s Strategy is underpinned by a relentless focus on running great restaurants to improve speed of service and enhance the customer experience. The Company believes this Strategy builds on our inherent strengths by harnessing our competitive advantages and investing in innovations that will enhance the customer experience and deliver long-term growth. To put even more emphasis on the customer experience, the Company announced in July 2021 the creation of a collaborative team that combines digital, marketing and operations with a focus on the end-to-end customer experience. The Company believes this enables us to deliver the seamless, omnichannel experience that our customers want and will transform the way they connect with and experience our brand.

16

Second Quarter and Six Months 2021 Financial Performance

Global comparable sales increased 40.5% for the quarter and 22.6% for the six months.

•U.S. comparable sales increased 25.9% for the quarter and 19.7% for the six months. Comparable sales results for both periods benefited from strong average check growth driven by larger order sizes and menu price increases. Strong national menu and marketing offerings, as well as growth in delivery and digital platforms, also contributed to the comparable sales growth.

•International Operated Markets segment comparable sales increased 75.1% for the quarter and 30.7% for the six months. Results for the quarter and six months reflected strong positive comparable sales in the U.K. and France due to significantly fewer restaurant closures and the continued easing of COVID-19 restrictions.

•International Developmental Licensed Markets segment comparable sales increased 32.3% for the quarter and 18.0% for the six months. Both periods reflected strong comparable sales in Japan and China, while the quarter also benefited from strong comparable sales in Brazil.

In addition to the comparable sales results, the Company had the following financial results for the quarter and six months 2021:

•Consolidated revenues increased 57% (49% in constant currencies) for the quarter and 30% (25% in constant currencies) for the six months.

•Systemwide sales increased 48% (42% in constant currencies) for the quarter and 29% (24% in constant currencies) for the six months.

•Consolidated operating income increased $1,730 million for the quarter and $2,318 million for the six months. Results included $98 million and $233 million of net strategic gains for the quarter and six months, respectively, primarily related to the sale of McDonald's Japan stock.

•Diluted earnings per share was $2.95 for the quarter and $5.00 for the six months. Refer to the Net Income and Diluted Earnings per Share section on page 21 for additional details.

Management reviews and analyzes business results excluding the effect of foreign currency translation, impairment and other strategic charges and gains, as well as material regulatory and other income tax impacts, and bases incentive compensation plans on these results because the Company believes this better represents underlying business trends.

17

The Following Definitions Apply to these Terms as Used Throughout this Form 10-Q:

•Constant currency results exclude the effects of foreign currency translation and are calculated by translating current year results at prior year average exchange rates. Management reviews and analyzes business results excluding the effect of foreign currency translation, impairment and other strategic charges and gains, as well as material regulatory and other income tax impacts, and bases incentive compensation plans on these results because the Company believes this better represents underlying business trends.

•Comparable sales are compared to the same period in the prior year and represent sales at all restaurants, whether operated by the Company or by franchisees, in operation at least thirteen months including those temporarily closed. Some of the reasons restaurants may be temporarily closed include reimaging or remodeling, rebuilding, road construction and natural disasters (including restaurants temporarily closed due to COVID-19). Comparable sales exclude the impact of currency translation and the sales of any market considered hyper-inflationary (generally identified as those markets whose cumulative inflation rate over a three-year period exceeds 100%), which management believes more accurately reflects the underlying business trends. Comparable sales are driven by changes in guest counts and average check, the latter of which is affected by changes in pricing and product mix.

•Comparable guest counts represent the number of transactions at all restaurants, whether operated by the Company or by franchisees, in operation at least thirteen months including those temporarily closed.

•Systemwide sales include sales at all restaurants, whether operated by the Company or by franchisees. While franchised sales are not recorded as revenues by the Company, management believes the information is important in understanding the Company's financial performance because these sales are the basis on which the Company calculates and records franchised revenues and are indicative of the financial health of the franchisee base. The Company's revenues consist of sales by Company-operated restaurants and fees from franchised restaurants operated by conventional franchisees, developmental licensees and affiliates. Changes in Systemwide sales are primarily driven by comparable sales and net restaurant unit expansion.

•Free cash flow, defined as cash provided by operations less capital expenditures, and free cash flow conversion rate, defined as free cash flow divided by net income (excluding the effect of impairment and other strategic charges and gains, as well as material regulatory and other income tax impacts), are measures reviewed by management in order to evaluate the Company’s ability to convert net profits into cash resources, after reinvesting in the core business, that can be used to pursue opportunities to enhance shareholder value.

18

CONSOLIDATED OPERATING RESULTS
	Quarter Ended					Six Months Ended
Dollars in millions, except per share data	June 30, 2021					June 30, 2021
	Amount			Increase/ (Decrease)		Amount			Increase/ (Decrease)
Revenues
Sales by Company-operated restaurants		$	2,488.7	56	%		$	4,650.2	28	%
Revenues from franchised restaurants		3,306.2		58			6,183.6		32
Other revenues		93.0		17			178.7		11
Total revenues		5,887.9		57			11,012.5		30
Operating costs and expenses
Company-operated restaurant expenses		2,021.0		40			3,838.6		20
Franchised restaurants-occupancy expenses		579.1		10			1,150.6		7
Other restaurant expenses		68.3		8			135.5		5
Selling, general & administrative expenses
Depreciation and amortization		83.1		17			159.1		10
Other		572.4		(1)			1,062.8		(3)
Other operating (income) expense, net		(127.1)		n/m			(306.5)		n/m
Total operating costs and expenses		3,196.8		14			6,040.1		4
Operating income		2,691.1		n/m			4,972.4		87
Interest expense		296.5		(7)			596.5		0
Nonoperating (income) expense, net		18.6		n/m			47.2		n/m
Income before provision for income taxes		2,376.0		n/m			4,328.7		n/m
Provision for income taxes		156.7		(5)			572.2		14
Net income		$	2,219.3	n/m			$	3,756.5	n/m
Earnings per common share-basic		$	2.97	n/m			$	5.03	n/m
Earnings per common share-diluted		$	2.95	n/m			$	5.00	n/m

n/m Not meaningful

19

Impact of Foreign Currency Translation

While changes in foreign currency exchange rates affect reported results, McDonald's mitigates exposures, where practical, by purchasing goods and services in local currencies, financing in local currencies and hedging certain foreign-denominated cash flows. Results excluding the effect of foreign currency translation (referred to as constant currency) are calculated by translating current year results at prior year average exchange rates.

IMPACT OF FOREIGN CURRENCY TRANSLATION
Dollars in millions, except per share data
					Currency Translation Benefit/ (Cost)
Quarters Ended June 30,	2021		2020			2021
Revenues	$	5,887.9	$	3,761.5		$	279.2
Company-operated margins	467.7		145.3			23.7
Franchised margins	2,727.1		1,563.5			128.2
Selling, general & administrative expenses	655.5		647.0			(15.4)
Operating income	2,691.1		961.1			134.7
Net income	2,219.3		483.8			99.2
Earnings per share-diluted	$	2.95	$	0.65		$	0.13
					Currency Translation Benefit/ (Cost)
Six Months Ended June 30,	2021		2020			2021
Revenues	$	11,012.5	$	8,475.9		$	434.0
Company-operated margins	811.6		418.3			35.5
Franchised margins	5,033.0		3,617.3			209.1
Selling, general & administrative expenses	1,221.9		1,236.8			(26.7)
Operating income	4,972.4		2,654.7			216.8
Net income	3,756.5		1,590.7			143.3
Earnings per share-diluted	$	5.00	$	2.12		$	0.19

•The impact of foreign currency translation on consolidated operating results for the quarter and six months primarily reflected the strengthening of the Euro, British Pound and Australian Dollar.

20

Net Income and Diluted Earnings per Share

For the quarter, net income was $2,219.3 million, and diluted earnings per share was $2.95. Foreign currency translation had a positive impact of $0.13 on diluted earnings per share.

For the six months, net income was $3,756.5 million, and diluted earnings per share was $5.00. Foreign currency translation had a positive impact of $0.19 on diluted earnings per share.

Results for the quarter and six months reflected stronger operating performance across all segments due to higher sales-driven restaurant margins as a result of fewer restaurant closures and the easing of COVID-19 restrictions compared with the prior year.

Results for the quarter included the following:

•Net pre-tax strategic gains of $98 million, or $0.10 per share, primarily related to the sale of McDonald's Japan stock

•$364 million, or $0.48 per share, of income tax benefits related to the remeasurement of deferred taxes as a result of a change in the U.K. statutory income tax rate

Results for the six months included the following:

•Net pre-tax strategic gains of $233 million, or $0.23 per share, primarily related to the sale of McDonald's Japan stock

•$364 million, or $0.48 per share, of income tax benefits related to the remeasurement of deferred taxes as a result of a change in the U.K. statutory income tax rate

EARNINGS PER SHARE-DILUTED RECONCILIATION

	Quarters Ended June 30,								Six Months Ended June 30,
	2021		2020		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation		2021		2020		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
GAAP earnings per share-diluted	$	2.95	$	0.65	n/m	%	n/m	%	$	5.00	$	2.12	n/m	%	n/m	%
Strategic (gains) charges	(0.10)		0.01						(0.23)		0.01
Income tax benefits	(0.48)		—						(0.48)		—
Non-GAAP earnings per share-diluted	$	2.37	$	0.66	n/m	%	n/m	%	$	4.29	$	2.13	n/m	%	n/m	%

n/m Not meaningful

Excluding the strategic gains and income tax benefits, net income was $1,784.8 million and diluted earnings per share was $2.37 for the quarter, and net income was $3,223.1 million and diluted earnings per share was $4.29 for the six months.

In the second quarter, the Company paid a quarterly dividend of $1.29 per share, or $963.3 million, bringing total dividends paid for the six months to $1.9 billion.

Revenues

The Company's revenues consist of sales by Company-operated restaurants and fees from restaurants operated by franchisees, developmental licensees and affiliates. Revenues from conventional franchised restaurants include rent and royalties based on a percent of sales with minimum rent payments, and initial fees. Revenues from restaurants licensed to developmental licensees and affiliates include a royalty based on a percent of sales, and generally include initial fees. The Company’s Other revenues are comprised of fees paid by franchisees to recover a portion of costs incurred by the Company for various technology platforms, revenues from brand licensing arrangements to market and sell consumer packaged goods using the McDonald’s brand, and third-party revenues for the Dynamic Yield business.

Franchised restaurants represented 93% of McDonald's restaurants worldwide at June 30, 2021. The Company's heavily franchised business model is designed to generate stable and predictable revenue, which is largely a function of franchisee sales, and resulting cash flow streams.

COVID-19 resurgences throughout the quarter and six months have resulted in instances of government restrictions on restaurant operating hours, limited dine-in capacity and, in some cases, dining room closures. The Company has continued to follow the guidance of expert health authorities to apply the appropriate precautionary measures to protect the health and safety of our people and our customers and expects some operating restrictions in various markets so long as the COVID-19 pandemic continues.

21

REVENUES
Dollars in millions
Quarters Ended June 30,	2021		2020		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
Company-operated sales
U.S.	$	668.2	$	551.8	21	%	21	%
International Operated Markets	1,635.3		882.8		85		73
International Developmental Licensed Markets & Corporate	185.2		159.1		16		7
Total	$	2,488.7	$	1,593.7	56	%	49	%
Franchised revenues
U.S.	$	1,567.7	$	1,165.2	35	%	35	%
International Operated Markets	1,410.5		706.5		100		79
International Developmental Licensed Markets & Corporate	328.0		216.3		52		46
Total	$	3,306.2	$	2,088.0	58	%	51	%
Total Company-operated sales and Franchised revenues
U.S.	$	2,235.9	$	1,717.0	30	%	30	%
International Operated Markets	3,045.8		1,589.3		92		76
International Developmental Licensed Markets & Corporate	513.2		375.4		37		29
Total	$	5,794.9	$	3,681.7	57	%	50	%
Total Other revenues	$	93.0	$	79.8	17	%	12	%
Total Revenues	$	5,887.9	$	3,761.5	57	%	49	%
Six Months Ended June 30,	2021		2020		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
Company-operated sales
U.S.	$	1,286.5	$	1,131.0	14	%	14	%
International Operated Markets	3,015.0		2,188.1		38		31
International Developmental Licensed Markets & Corporate	348.7		300.4		16		7
Total	$	4,650.2	$	3,619.5	28	%	24	%
Franchised revenues
U.S.	$	2,988.2	$	2,415.9	24	%	24	%
International Operated Markets	2,554.9		1,780.5		43		30
International Developmental Licensed Markets & Corporate	640.5		499.6		28		25
Total	$	6,183.6	$	4,696.0	32	%	26	%
Total Company-operated sales and Franchised revenues
U.S.	$	4,274.7	$	3,546.9	21	%	21	%
International Operated Markets	5,569.9		3,968.6		40		31
International Developmental Licensed Markets & Corporate	989.2		800.0		24		18
Total	$	10,833.8	$	8,315.5	30	%	25	%
Total Other revenues	$	178.7	$	160.4	11	%	8	%
Total Revenues	$	11,012.5	$	8,475.9	30	%	25	%

•Total Company-operated sales and franchised revenues increased 57% (50% in constant currencies) for the quarter and 30% (25% in constant currencies) for the six months. Both periods reflected strong sales performance in the International Operated Markets segment driven by the U.K., France and Russia, as well as in the U.S., as government-imposed COVID-19 restrictions were gradually lifted. Both periods also reflected strong sales performance in the International Developmental Licensed Markets driven by China.

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Comparable Sales

The following table presents the percent change in comparable sales for the quarters and six months ended June 30, 2021 and 2020:

	Increase/(Decrease)
	Quarters Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
U.S.	25.9	%	(8.7)	%	19.7	%	(4.5)	%
International Operated Markets	75.1		(41.4)		30.7		(24.8)
International Developmental Licensed Markets & Corporate	32.3		(24.2)		18.0		(14.4)
Total	40.5	%	(23.9)	%	22.6	%	(14.0)	%

Systemwide Sales and Franchised Sales

The following table presents the percent change in Systemwide sales for the quarters and six months ended June 30, 2021:

SYSTEMWIDE SALES*
	Quarter Ended June 30, 2021				Six Months Ended June 30, 2021
	Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
U.S.	25	%	25	%	19	%	19	%
International Operated Markets	97		78		45		33
International Developmental Licensed Markets & Corporate	42		37		25		21
Total	48	%	42	%	29	%	24	%

*    Unlike comparable sales, the Company has not excluded sales from hyper-inflationary markets from Systemwide sales as these sales are the basis on which the Company calculates and records revenues.

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Franchised sales are not recorded as revenues by the Company, but are the basis on which the Company calculates and records franchised revenues and are indicative of the financial health of the franchisee base. The following table presents Franchised sales and the related increases/(decreases):

FRANCHISED SALES
Dollars in millions
Quarters Ended June 30,	2021		2020		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
U.S.	$	11,174.9	$	8,889.9	26	%	26	%
International Operated Markets	8,351.0		4,184.9		100		79
International Developmental Licensed Markets & Corporate	6,266.2		4,381.7		43		38
Total	$	25,792.1	$	17,456.5	48	%	42	%
Ownership type
Conventional franchised	$	19,428.6	$	13,051.1	49	%	42	%
Developmental licensed	3,565.2		2,056.9		73		66
Foreign affiliated	2,798.3		2,348.5		19		16
Total	$	25,792.1	$	17,456.5	48	%	42	%
Six Months Ended June 30,	2021		2020		Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
U.S.	$	21,264.7	$	17,763.6	20	%	20	%
International Operated Markets	15,231.6		10,377.6		47		33
International Developmental Licensed Markets & Corporate	12,314.2		9,828.7		25		22
Total	$	48,810.5	$	37,969.9	29	%	24	%
Ownership type
Conventional franchised	$	36,336.2	$	28,037.5	30	%	24	%
Developmental licensed	6,845.4		5,284.9		30		27
Foreign affiliated	5,628.9		4,647.5		21		17
Total	$	48,810.5	$	37,969.9	29	%	24	%

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Restaurant Margins

Franchised restaurant margins are measured as revenues from franchised restaurants less franchised restaurant occupancy costs. Franchised revenues include rent and royalties based on a percent of sales, and initial fees. Franchised restaurant occupancy costs include lease expense and depreciation, as the Company generally owns or secures a long-term lease on the land and building for the restaurant location.

Company-operated restaurant margins are measured as sales from Company-operated restaurants less costs for food & paper,

payroll & employee benefits and occupancy & other operating expenses necessary to run an individual restaurant. Company-operated

margins exclude costs that are not allocated to individual restaurants, primarily payroll & employee benefit costs of non-restaurant support staff, which are included in selling, general and administrative expenses.

RESTAURANT MARGINS
Dollars in millions
	Amount				Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
Quarters Ended June 30,	2021		2020
Franchised
U.S.	$	1,275.8	$	882.7	45	%	45	%
International Operated Markets	1,129.5		470.5		n/m		n/m
International Developmental Licensed Markets & Corporate	321.8		210.3		53		47
Total	$	2,727.1	$	1,563.5	74	%	66	%
Company-operated
U.S.	$	148.1	$	83.3	78	%	78	%
International Operated Markets	312.1		57.1		n/m		n/m
International Developmental Licensed Markets & Corporate	n/m		n/m		n/m		n/m
Total	$	467.7	$	145.3	n/m		n/m
Total restaurant margins
U.S.	$	1,423.9	$	966.0	47	%	47	%
International Operated Markets	1,441.6		527.6		n/m		n/m
International Developmental Licensed Markets & Corporate	n/m		n/m		n/m		n/m
Total	$	3,194.8	$	1,708.8	87	%	78	%
	Amount				Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
Six Months Ended June 30,	2021		2020
Franchised
U.S.	$	2,406.9	$	1,844.0	31	%	31	%
International Operated Markets	1,998.1		1,285.8		55		40
International Developmental Licensed Markets & Corporate	628.0		487.5		29		25
Total	$	5,033.0	$	3,617.3	39	%	33	%
Company-operated
U.S.	$	273.2	$	163.8	67	%	67	%
International Operated Markets	530.1		254.8		n/m		94
International Developmental Licensed Markets & Corporate	n/m		n/m		n/m		n/m
Total	$	811.6	$	418.3	94	%	86	%
Total restaurant margins
U.S.	$	2,680.1	$	2,007.8	33	%	33	%
International Operated Markets	2,528.2		1,540.6		64		49
International Developmental Licensed Markets & Corporate	n/m		n/m		n/m		n/m
Total	$	5,844.6	$	4,035.6	45	%	39	%

n/m Not meaningful

•Total restaurant margins increased $1,486.0 million or 87% (78% in constant currencies) for the quarter and $1,809.0 million or 45% (39% in constant currencies) for the six months, primarily due to strong sales performance across all segments. Franchised margins represented over 85% of restaurant margin dollars for the quarter and six months.

•U.S. franchised margins for both periods reflected higher depreciation costs related to investments in restaurant modernization and the comparison to prior year support provided for marketing to accelerate recovery and drive growth.

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•Total restaurant margins included $379.0 million and $755.6 million of depreciation and amortization expense for the quarter and six months, respectively.

Selling, General & Administrative Expenses

•Selling, general and administrative expenses increased $8.5 million or 1% (decreased 1% in constant currencies) for the quarter and decreased $14.9 million or 1% (3% in constant currencies) for the six months. Both periods reflected a benefit from the comparison to incremental marketing contributions in the prior year, partly offset by higher incentive-based compensation and higher costs for investments in restaurant technology.

•Selling, general and administrative expenses as a percent of Systemwide sales was 2.3% and 3.0% for the six months ended 2021 and 2020, respectively.

Other Operating (Income) Expense, Net

OTHER OPERATING (INCOME) EXPENSE, NET
Dollars in millions
	Quarters Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Gains on sales of restaurant businesses	$	(27.1)	$	(0.3)	$	(44.7)	$	(2.8)
Equity in earnings of unconsolidated affiliates	(42.8)		(4.5)		(77.9)		(19.2)
Asset dispositions and other (income) expense, net	40.6		110.0		49.1		184.4
Impairment and other charges (gains), net	(97.8)		12.0		(233.0)		13.3
Total	$	(127.1)	$	117.2	$	(306.5)	$	175.7

•Gains on sales of restaurant businesses increased for the quarter and six months due to a higher number of restaurant sales, primarily in the U.S. and Australia.

•Equity in earnings of unconsolidated affiliates increased for the quarter and six months due to recovery from the impact of COVID-19 in the prior year.

•Asset dispositions and other expense, net decreased for the quarter and six months. Prior year results reflected increased reserves for bad debts related to COVID-19 of $45 million for the quarter and $92 million for the six months. Prior year results for both periods also reflected $31 million of payments to distribution centers for obsolete inventory to support franchisee liquidity.

•Impairment and other charges (gains), net for the quarter and six months 2021 reflected $98 million and $233 million, respectively, primarily due to strategic gains related to the sale of McDonald’s Japan stock, which reduced the Company's total ownership by 3% for the quarter and 6% for the six months. As of June 30, 2021, the Company owned approximately 38% of McDonald's Japan. Results for the quarter and six months 2020 reflected the write-off of impaired software of $12 million and $26 million, respectively. The six months 2020 was partly offset by $13 million of income primarily comprised of a reversal of a reserve associated with the Company's sale of its business in the India Delhi market.

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Operating Income

OPERATING INCOME & OPERATING MARGIN
Dollars in millions
Quarters Ended June 30,	2021			2020			Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
U.S.	$	1,267.5		$	735.2		72	%	72	%
International Operated Markets	1,272.0			234.8			n/m		n/m
International Developmental Licensed Markets & Corporate	151.6			(8.9)			n/m		n/m
Total	$	2,691.1		$	961.1		n/m		n/m
Six Months Ended June 30,	2021			2020			Inc/ (Dec)		Inc/ (Dec) Excluding Currency Translation
U.S.	$	2,393.0		$	1,627.6		47	%	47	%
International Operated Markets	2,225.8			1,113.9			100		81
International Developmental Licensed Markets & Corporate	353.6			(86.8)			n/m		n/m
Total	$	4,972.4		$	2,654.7		87	%	79	%
Operating margin	45.2		%	31.3		%
Non-GAAP operating margin	43.0		%	31.5		%

n/m Not meaningful

•Operating Income: Operating income increased to $2,691.1 million for the quarter and $4,972.4 million for the six months. Results included $98 million and $233 million for the quarter and six months, respectively, of net strategic gains primarily related to the sale of McDonald's Japan stock.

•U.S.: The operating income increase for the quarter and six months was driven by strong sales performance and higher gains on sales of restaurant businesses in the current year.

•International Operated Markets: The operating income increase for the quarter and six months was driven by strong sales performance, primarily in the U.K. and France.

•International Developmental Licensed Markets & Corporate: Excluding the strategic gains, results for the quarter and six months reflected strong sales performance driven by Japan and China and the benefit from comparisons to prior year reserves for bad debts, partly offset by higher Corporate general and administrative expenses due to increased incentive-based compensation in the current year.

•Operating Margin: Operating margin is defined as operating income as a percent of total revenues. The contributions to operating margin differ by segment due to each segment's ownership structure, primarily due to the relative percentage of franchised versus Company-operated restaurants. Additionally, temporary restaurant closures, which vary by segment, impact the contribution of each segment to the consolidated operating margin.

Excluding the strategic gains, the increase in operating margin percent for the quarter and six months was driven by stronger sales performance and higher other operating income.

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Interest Expense

•Interest expense decreased 7% (9% in constant currencies) for the quarter and was flat (decreased 2% in constant currencies) for the six months, primarily due to lower average debt balances partly offset by the impact of foreign currency translation and higher average interest rates.

Nonoperating (Income) Expense, Net

NONOPERATING (INCOME) EXPENSE, NET
Dollars in millions
	Quarters Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Interest income	$	(2.4)	$	(5.0)	$	(4.2)	$	(10.4)
Foreign currency and hedging activity	19.1		(0.6)		39.4		(18.4)
Other expense, net	1.9		(1.1)		12.0		(9.2)
Total	$	18.6	$	(6.7)	$	47.2	$	(38.0)

Income Taxes

•The effective income tax rate was 6.6% and 25.4% for the quarters ended 2021 and 2020, respectively, and 13.2% and 24.0% for the six months ended 2021 and 2020, respectively.

•Excluding a benefit of $364 million related to the remeasurement of deferred taxes as a result of a change in the U.K. statutory income tax rate and the tax impact of the strategic gains, the non-GAAP effective income tax rate was 21.7% for the quarter and 21.3% for the six months.

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Cash Flows

The Company has a long history of generating significant cash from operations and has substantial credit capacity to fund operating and discretionary spending such as capital expenditures, debt repayments, dividends and share repurchases.

Cash provided by operations totaled $3.9 billion and exceeded capital expenditures by $3.0 billion for the six months 2021. Cash provided by operations increased $2.5 billion compared with the six months 2020, primarily due to improved operating results and changes in working capital, partly offset by higher income tax payments.

Cash used for investing activities totaled $658.1 million for the six months 2021, a decrease of $256.9 million compared with the six months 2020. The decrease was primarily due to current year proceeds received from the sale of McDonald's Japan stock.

Cash used for financing activities totaled $3.6 billion for the six months 2021, which included $1.7 billion in debt repayments. Cash provided by financing activities totaled $2.0 billion for the six months 2020 due to long-term debt issuances of $5.5 billion, which were used to bolster our cash position in anticipation of the adverse macroeconomic and business conditions associated with COVID-19.

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Outlook for 2021

Based on current conditions, the following is provided to assist in forecasting the Company's future results for 2021.

•The Company expects 2021 Systemwide sales growth, in constant currencies, in the mid-to-high teens, and expects net restaurant unit expansion to contribute about 1% to 2021 Systemwide sales growth.

•The Company expects operating margin percent to be in the low-to-mid 40% range.

•The Company expects full year 2021 selling, general and administrative expenses of approximately 2.4% of Systemwide sales.

•Based on current interest and foreign currency exchange rates, the Company expects full year 2021 interest expense to decrease about 1% to 3% due primarily to lower average debt balances as the Company expects to reduce current debt levels to return to pre-COVID-19 leverage ratios.

•The Company expects the effective income tax rate for the second half of 2021 to be in the 21% to 23% range. Some volatility may result in a quarterly tax rate outside of this range.

•The Company expects 2021 capital expenditures to be approximately $2.3 billion, about half of which will be directed towards new unit expansion across the U.S. and International Operated Markets.

In 2021, about $1.1 billion will be dedicated to our U.S. business, about $550 million of which will be allocated to about 1,300 restaurant modernization projects. Globally, the Company expects to open over 1,300 restaurants. We will open over 450 restaurants in the U.S. and International Operated Markets segments, and our developmental licensee and affiliates will contribute capital towards over 850 restaurant openings in their respective markets. Additionally, the U.S. expects to close roughly 325 restaurants in 2021, a majority of which are lower sales volume McDonald's in Walmart locations. The Company expects about 650 net restaurant additions in 2021.

•The Company expects to achieve a free cash flow conversion rate greater than 90%.

Recent Accounting Pronouncements

Recent accounting pronouncements are discussed in Part I, Item 1, page 9 of this Form 10-Q.

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Risk Factors and Cautionary Statement Regarding Forward-Looking Statements

The information in this report includes forward-looking statements about future events and circumstances and their effects upon revenues, expenses and business opportunities. Generally speaking, any statement in this report not based upon historical fact is a forward-looking statement. Forward-looking statements can also be identified by the use of forward-looking or conditional words, such as “could,” “should,” “can,” “continue,” “estimate,” “forecast,” “intend,” “look,” “may,” “will,” “expect,” “believe,” “anticipate,” “plan,” “remain,” “confident” and “commit” or similar expressions. In particular, statements regarding our plans, strategies, prospects and expectations regarding our business and industry are forward-looking statements. They reflect our expectations, are not guarantees of performance and speak only as of the date the statement is made. Except as required by law, we do not undertake to update such forward-looking statements. Our business results are subject to a variety of risks, including those that are reflected in the following considerations and risks, as well as elsewhere in our filings with the SEC. The considerations and risks that follow are organized within relevant headings but may be relevant to other headings as well. If any of these considerations or risks materialize, our expectations (or the underlying assumptions) may change and our performance may be adversely affected. You should not rely unduly on forward-looking statements.

GLOBAL PANDEMIC

The COVID-19 pandemic has adversely affected and is expected to continue to adversely affect our financial results, condition and outlook.

Health epidemics or pandemics can adversely affect consumer spending and confidence levels and supply availability and costs, as well as the local operations in impacted markets, all of which can affect our financial results, condition and outlook. Importantly, the global pandemic resulting from COVID-19 has disrupted global health, economic and market conditions, consumer behavior and McDonald’s global restaurant operations since early 2020. Local and national governmental mandates or recommendations and public perceptions of the risks associated with the COVID-19 pandemic have caused, and we expect will continue to cause, consumer behavior to change and worsening or volatile economic conditions in certain markets, each of which could continue to adversely affect our business. In addition, our global operations have been disrupted to varying degrees in different markets and may continue to be disrupted to varying degrees given the unpredictability of the virus, its resurgences and variants and government responses thereto as well as potentially permanent changes to the industry in which we operate. While we cannot predict the duration or scope of the COVID-19 pandemic, the resurgence of infections or the emergence of new variants in one or more markets, the availability or acceptance of vaccines or vaccination rates across the globe, the COVID-19 pandemic has negatively impacted our business and is expected to continue to impact our financial results, condition and outlook in a way that may be material.

The COVID-19 pandemic may also heighten other risks disclosed in these Risk Factors, such as, but not limited to, those related to consumer behavior, consumer perceptions of our brand, competition, supply chain interruptions, commodity costs and labor availability and cost.

STRATEGY AND BRAND

If we do not successfully evolve and execute against our business strategies, including the Accelerating the Arches strategy, we may not be able to drive business growth.

To drive Systemwide sales, operating income and free cash flow growth, our business strategies must be effective in maintaining and strengthening customer appeal and capturing additional market share. Whether these strategies are successful depends mainly on our System’s ability to:

•Capitalize on our global scale, iconic brand and local market presence to build upon our historic strengths and competitive advantages, such as our marketing, core menu items and digital, delivery and drive thru;

•Continue to innovate and differentiate the McDonald's experience, including by preparing and serving our food in a way that balances value and convenience to our customers with profitability;

•Accelerate technology investments for a fast and easy customer experience;

•Continue to run great restaurants by driving efficiencies and expanding capacities while continuing to prioritize health and safety;

•Identify and develop restaurant sites consistent with our plans for net growth of Systemwide restaurants;

•Accelerate our existing strategies, including through growth opportunities and potential acquisitions, investments and partnerships; and

•Evolve and adjust our business strategies in response to, among other things, changing consumer behavior, operational restrictions and impacts to our results of operations and liquidity, including as a result of the COVID-19 pandemic.

If we are delayed or unsuccessful in executing our strategies, or if our strategies do not yield the desired results, our business, financial condition and results of operations may suffer.

31

Failure to preserve the value and relevance of our brand could have an adverse impact on our financial results.

To be successful in the future, we believe we must preserve, enhance and leverage the value of our brand, including our corporate purpose, mission and values. Brand value is based in part on consumer perceptions. Those perceptions are affected by a variety of factors, including the nutritional content and preparation of our food, the ingredients we use, the manner in which we source commodities, and general business practices across the System, including the people practices at McDonald's restaurants. Consumer acceptance of our offerings is subject to change for a variety of reasons, and some changes can occur rapidly. For example, nutritional, health, environmental and other scientific studies and conclusions, which constantly evolve and may have contradictory implications, drive popular opinion, litigation and regulation (including initiatives intended to drive consumer behavior) in ways that affect the “informal eating out” (“IEO”) segment or perceptions of our brand, generally or relative to available alternatives. Consumer perceptions may also be affected by adverse commentary from third parties, including through social media or conventional media outlets, regarding the quick-service category of the IEO segment, our brand, our culture, our operations, our suppliers, or our franchisees. If we are unsuccessful in addressing adverse commentary or perceptions, whether or not accurate, our brand and our financial results may suffer.

Additionally, the ongoing relevance of our brand may depend on the success of our sustainability initiatives, which require Systemwide coordination and alignment. We are working to manage risks and costs to us, our franchisees and our supply chain of any effects of climate change, greenhouse gases, and diminishing energy and water resources. These risks include any increased public focus, including by governmental and nongovernmental organizations, on these and other environmental sustainability matters, such as packaging and waste, animal health and welfare, deforestation and land use. These risks also include any increased pressure to make commitments, set targets or establish additional goals and take actions to meet them, which could expose us to market, operational and execution costs or risks.

Our brand trust also depends on how we address social risks, including through our increased focus on human capital initiatives and diversity, equity and inclusion (DEI). We expect our DEI strategy to represent a step change in how we view equitable opportunity across our System. Additionally, we have announced Global Brand Standards that will apply to McDonald’s operations worldwide, including both Company-owned and franchised restaurants.

If we are not effective in addressing social and environmental responsibility matters or achieving relevant social or sustainability goals, our brand trust may suffer. In particular, business incidents or practices, whether actual or perceived, that erode consumer trust or confidence, particularly if such incidents or practices receive considerable publicity or result in litigation, can significantly reduce brand value and have a negative impact on our financial results.

If we do not anticipate and address evolving consumer preferences and effectively execute our pricing, promotional and marketing plans, our business could suffer.

Our continued success depends on our System’s ability to build upon our historic strengths and competitive advantages. In order to do so, we need to anticipate and respond effectively to continuously shifting consumer demographics and trends in food sourcing, food preparation, food offerings and consumer preferences and behaviors in the IEO segment. If we are not able to predict, or quickly and effectively respond to, these changes, or our competitors predict or respond more effectively, our financial results could be adversely impacted.

Our ability to build upon our strengths and advantages also depends on the impact of pricing, promotional and marketing plans across the System, and the ability to adjust these plans to respond quickly and effectively to evolving customer preferences, as well as shifting economic and competitive conditions. Existing or future pricing strategies and marketing plans, as well as the value proposition they represent, are expected to continue to be important components of our business strategy; however, they may not be successful, or may not be as successful as the efforts of our competitors, and could negatively impact sales, guest counts and market share.

Additionally, we operate in a complex and costly advertising environment. Our marketing and advertising programs may not be successful in reaching our customers in the way we intend. Our success depends in part on whether the allocation of our advertising and marketing resources across different channels, including digital marketing, allows us to reach our customers effectively and efficiently, and in ways that are meaningful to them. If the advertising and marketing programs are not successful, or are not as successful as those of our competitors, our sales, guest counts and market share could decrease.

Our investments to enhance the customer experience, including through technology, may not generate the expected results.

Our long-term business objectives depend on the successful Systemwide execution of our strategies. We continue to build upon our investments in technology and modernization, digital engagement and delivery, in order to transform the customer experience. As part of these investments, we are placing renewed emphasis on improving our service model and strengthening relationships with customers, in part through digital channels and loyalty initiatives, mobile ordering and payment systems, and enhancing our drive thru technologies, which may not generate expected results. We also continue to offer and refine our delivery initiatives, including through growing awareness and trial. Utilizing a third-party delivery service may not have the same level of profitability as a non-delivery transaction, and may introduce additional food quality and customer satisfaction risks. If these customer experience initiatives are not well executed, or if we do not fully realize the intended benefits of these significant investments, our business results may suffer.

32

We face intense competition in our markets, which could hurt our business.

We compete primarily in the IEO segment, which is highly competitive. We also face sustained, intense competition from traditional, fast casual and other competitors, which may include many non-traditional market participants such as convenience stores, grocery stores and coffee shops as well as online retailers. We expect our environment to continue to be highly competitive, and our results in any particular reporting period may be impacted by a contracting IEO segment or by new or continuing actions, product offerings or consolidation of our competitors and third-party partners, which may have a short- or long-term impact on our results.

We compete on the basis of product choice, quality, affordability, service and location. In particular, we believe our ability to compete successfully in the current market environment depends on our ability to improve existing products, successfully develop and introduce new products, price our products appropriately, deliver a relevant customer experience, manage the complexity of our restaurant operations, manage our investments in technology and modernization, and respond effectively to our competitors’ actions or offerings or to unforeseen disruptive actions. There can be no assurance these strategies will be effective, and some strategies may be effective at improving some metrics while adversely affecting other metrics, which could have the overall effect of harming our business.

We may not be able to adequately protect our intellectual property or adequately ensure that we are not infringing the intellectual property of others, which could harm the value of the McDonald’s brand and our business.

The success of our business depends on our continued ability to use our existing trademarks and service marks in order to increase brand awareness and further develop our branded products in both domestic and international markets. We rely on a combination of trademarks, copyrights, service marks, trade secrets, patents and other intellectual property rights to protect our brand and branded products.

We have registered certain trademarks and have other trademark registrations pending in the U.S. and certain foreign jurisdictions. The trademarks that we currently use have not been registered in all of the countries outside of the U.S. in which we do business or may do business in the future and may never be registered in all of these countries. It may be costly and time consuming to protect our intellectual property, and the steps we have taken to protect our intellectual property in the U.S. and foreign countries may not be adequate. In addition, the steps we have taken may not adequately ensure that we do not infringe the intellectual property of others, and third parties may claim infringement by us in the future. In particular, we may be involved in intellectual property claims, including often aggressive or opportunistic attempts to enforce patents used in information technology systems, which might affect our operations and results. Any claim of infringement, whether or not it has merit, could be time-consuming, result in costly litigation and harm our business.

We cannot ensure that franchisees and other third parties who hold licenses to our intellectual property will not take actions that hurt the value of our intellectual property.

OPERATIONS

The global scope of our business subjects us to risks that could negatively affect our business.

We encounter differing cultural, regulatory, geopolitical and economic environments within and among the more than 100 countries where McDonald’s restaurants operate, and our ability to achieve our business objectives depends on the System's success in these environments. Meeting customer expectations is complicated by the risks inherent in our global operating environment, and our global success is partially dependent on our System’s ability to leverage operating successes across markets and brand perceptions. Planned initiatives may not have appeal across multiple markets with McDonald's customers and could drive unanticipated changes in customer perceptions and guest counts.

Disruptions in operations or price volatility in a market can also result from governmental actions, such as price, foreign exchange or changes in trade-related tariffs or controls, sanctions and counter sanctions, government-mandated closure of our, our franchisees’ or our suppliers’ operations, and asset seizures. Trade policies, tariffs and other regulations affecting trade between the U.S. and other countries could adversely affect our business and operations. These and other government actions may impact our results and could cause reputational or other harm. Our international success depends in part on the effectiveness of our strategies and brand-building initiatives to reduce our exposure to such governmental actions.

Additionally, challenges and uncertainties are associated with operating in developing markets, which may entail a relatively higher risk of political instability, economic volatility, crime, corruption and social and ethnic unrest. Such challenges may be exacerbated in many cases by a lack of an independent and experienced judiciary and uncertainties in how local law is applied and enforced, including in areas most relevant to commercial transactions and foreign investment. An inability to manage effectively the risks associated with our international operations could have a material adverse effect on our business and financial condition.

We may also face challenges and uncertainties in developed markets. For example, the U.K.’s exit from the European Union has caused increased regulatory complexities and uncertainty in European economic conditions, and it is possible that it may also cause uncertainty in worldwide economic conditions. The decision created volatility in certain foreign currency exchange rates that may or may not continue, and may result in increased supply chain costs for items that are imported from other countries. Any of these effects, and others we cannot anticipate, could adversely affect our business, results of operations, financial condition and cash flows.

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Supply chain interruptions may increase costs or reduce revenues.

We depend on the effectiveness of our supply chain management to assure reliable and sufficient supply of quality products on favorable terms. Although many of the products we sell are sourced from a wide variety of suppliers in countries around the world, certain products have limited suppliers, which may increase our reliance on those suppliers. Supply chain interruptions, including as a result of shortages and transportation issues or unexpected increases in demand, and price increases can adversely affect us as well as our suppliers and franchisees, whose performance may have a significant impact on our results. Such shortages or disruptions could be caused by factors beyond the control of our suppliers, franchisees or us. If we experience interruptions in our System’s supply chain, or if contingency planning is not effective, our costs could increase and it could limit the availability of products critical to our System’s operations.

Our franchise business model presents a number of risks.

The Company's success as a heavily franchised business relies to a large degree on the financial success and cooperation of our franchisees, including our developmental licensees and affiliates. Our restaurant margins arise from two sources: fees from franchised restaurants (e.g., rent and royalties based on a percentage of sales) and, to a lesser degree, sales from Company-operated restaurants. Our franchisees and developmental licensees manage their businesses independently, and therefore are responsible for the day-to-day operation of their restaurants. The revenues we realize from franchised restaurants are largely dependent on the ability of our franchisees to grow their sales. Business risks affecting our operations also affect our franchisees. In particular, our franchisees have also been significantly impacted by the COVID-19 pandemic and the volatility associated with the pandemic. If franchisee sales trends worsen or volatility persists, our financial results will continue to be negatively affected, which may be material.

Our success also relies on the willingness and ability of our independent franchisees and affiliates to implement major initiatives, which may include financial investment, and to remain aligned with us on operating, value/promotional and capital-intensive reinvestment plans. The ability of franchisees to contribute to the achievement of our plans is dependent in large part on the availability to them of funding at reasonable interest rates and may be negatively impacted by the financial markets in general, by the creditworthiness of our franchisees or the Company or by banks’ lending practices. If our franchisees are unwilling or unable to invest in major initiatives or are unable to obtain financing at commercially reasonable rates, or at all, our future growth and results of operations could be adversely affected.

Our operating performance could also be negatively affected if our franchisees experience food safety or other operational problems or project an image inconsistent with our brand and values, particularly if our contractual and other rights and remedies are limited, costly to exercise or subjected to litigation and potential delays. If franchisees do not successfully operate restaurants in a manner consistent with our required standards, our brand’s image and reputation could be harmed, which in turn could hurt our business and operating results.

Our ownership mix also affects our results and financial condition. The decision to own restaurants or to operate under franchise or license agreements is driven by many factors whose interrelationship is complex. The benefits of our more heavily franchised structure depend on various factors including whether we have effectively selected franchisees, licensees and/or affiliates that meet our rigorous standards, whether we are able to successfully integrate them into our structure and whether their performance and the resulting ownership mix supports our brand and financial objectives.

Challenges with respect to labor, including availability and cost, could impact our business and results of operations.

Our success depends in part on our System’s ability to proactively recruit, motivate and retain qualified individuals to work in McDonald’s restaurants and to maintain appropriately-staffed restaurants in an intensely competitive labor market. If we or our franchisees are unable to adequately staff McDonald's restaurants, it could negatively impact our operations, including speed of service to customers, and customer satisfaction levels. The System’s ability to meet its labor needs is generally subject to external factors, including the availability of sufficient workforce in the markets in which we operate, unemployment levels in those markets and prevailing wage rates.

Further, increased costs and competition associated with recruiting, motivating and retaining qualified employees to work in our Company-operated restaurants, as well as costs to promote awareness of the opportunities of working at our restaurants, could have a negative impact on our Company-operated margins. Similar concerns apply to our franchisees’ profitability.

We are also impacted by the costs and other effects of compliance with U.S. and international regulations affecting our workforce, which includes our staff and employees working in our Company-operated restaurants. These regulations are increasingly focused on employment issues, including wage and hour, healthcare, immigration, retirement and other employee benefits and workplace practices. Claims of non-compliance with these regulations could result in liability and expense to us. Our potential exposure to reputational and other harm regarding our workplace practices or conditions or those of our independent franchisees or suppliers, including those giving rise to claims of harassment or discrimination (or perceptions thereof) or workplace safety could have a negative impact on consumer perceptions of us and our business. Additionally, economic action, such as boycotts, protests, work stoppages or campaigns by labor organizations, could adversely affect us (including our ability to recruit and retain talent) or the franchisees and suppliers that are also part of the McDonald’s System and whose performance may have a material impact on our results.

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Effective succession planning is important to our continued success.

Effective succession planning is important to our long-term success. Failure to effectively identify, develop and retain key personnel, recruit high-quality candidates and ensure smooth management and personnel transitions could disrupt our business and adversely affect our results.

Food safety concerns may have an adverse effect on our business.

Our ability to increase sales and profits depends on our System’s ability to meet expectations for safe food and on our ability to manage the potential impact on McDonald’s of food-borne illnesses and food or product safety issues that may arise in the future, including in the supply chain, restaurants or delivery. Food safety is a top priority, and we dedicate substantial resources to ensure that our customers enjoy safe food products, including as our menu and service model evolve. However, food safety events, including instances of food-borne illness, occur within the food industry and our System from time to time and could occur in the future. Instances of food tampering, food contamination or food-borne illness, whether actual or perceived, could adversely affect our brand and reputation as well as our revenues and profits.

If we do not effectively manage our real estate portfolio, our operating results may be negatively impacted.

We have significant real estate operations, primarily in connection with our restaurant business. We generally own or secure a long-term lease on the land and building for conventional franchised and Company-operated restaurant sites. We seek to identify and develop restaurant locations that offer convenience to customers and long-term sales and profit potential. As we generally secure long-term real estate interests for our restaurants, we have limited flexibility to quickly alter our real estate portfolio. The competitive business landscape continues to evolve in light of changing business trends; consumer preferences; trade area demographics; consumer use of digital, delivery and drive thru; local competitive positions and other economic factors. If our restaurants are not located in desirable locations, or if we do not evolve in response to these factors, it could adversely affect Systemwide sales and profitability.

Our real estate values and the costs associated with our real estate operations are also impacted by a variety of other factors, including governmental regulations; insurance; zoning, tax and eminent domain laws; interest rate levels and the cost of financing. A significant change in real estate values, or an increase in costs as a result of any of these factors, could adversely affect our operating results.

Information technology system failures or interruptions, or breaches of network security, may impact our operations or cause reputational harm.

We are increasingly reliant upon technology systems, such as point-of-sale, technologies supporting McDonald’s digital and delivery solutions, and technologies that facilitate communication and collaboration with affiliated entities, customers, employees, franchisees, suppliers, service providers or other independent third parties to conduct our business, whether developed and maintained by us or provided by third parties. Any failure or interruption of these systems could significantly impact our operations, our franchisees’ operations, or our customers’ experience and perceptions.

Security incidents or breaches have from time to time occurred and may in the future occur involving our systems, the systems of the parties we communicate or collaborate with (including franchisees), or those of third-party providers. These may include such things as unauthorized access, phishing attacks, account takeovers, denial of service, computer viruses, introduction of malware or ransomware and other disruptive problems caused by hackers. These technology systems contain personal, financial and other information that is entrusted to us by our customers, our employees, our franchisees, our business customers and other third parties, as well as financial, proprietary and other confidential information related to our business. Despite response procedures and measures in place in the event of an incident, a security breach could result in disruptions, shutdowns, theft or unauthorized disclosure of personal, financial, proprietary or other confidential information. The actual or alleged occurrence of any of these incidents could result in mitigation costs, reputational damage, adverse publicity, loss of consumer confidence, reduced sales and profits, complications in executing our growth initiatives and regulatory and legal risk, including criminal penalties or civil liabilities.

We also provide certain technology systems to businesses that are unaffiliated with the McDonald’s System and a failure, interruption or breach of these systems may cause harm to those unaffiliated parties, which may result in liability to the Company or reputational harm.

Despite the implementation of security measures, any of these technology systems could become vulnerable to damage, disability or failures due to theft, fire, power loss, telecommunications failure or other catastrophic events. Certain technology systems may also become vulnerable, unreliable or inefficient in cases where technology vendors limit or terminate product support and maintenance. Our increasing reliance on third-party systems also subjects us to risks faced by the third-party’s business, including the operational, security and credit risks of those parties. If technology systems were to fail or otherwise be unavailable, or if business continuity or disaster recovery plans were not effective, and we were unable to recover in a timely manner, we could experience an interruption in our or our franchisees’ operations.

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LEGAL AND REGULATORY

Increasing regulatory and legal complexity may adversely affect our business and financial results.

Our regulatory and legal environment worldwide exposes us to complex compliance, litigation and similar risks that could affect our operations and results in material ways. Many of our markets are subject to increasing, conflicting and highly prescriptive regulations involving, among other matters, restaurant operations, product packaging, marketing, the nutritional and allergen content and safety of our food and other products, labeling and other disclosure practices. Compliance efforts with those regulations may be affected by ordinary variations in food preparation among our own restaurants and the need to rely on the accuracy and completeness of information from third-party suppliers. We also are subjected to increased public focus, including by governmental and nongovernmental organizations, regarding environmental and social initiatives. Our success depends in part on our ability to manage the impact of regulations and other initiatives that can affect our business plans and operations, and have increased our costs of doing business and exposure to litigation, governmental investigations or other proceedings.

We are also subject to legal proceedings that may adversely affect our business, including class actions, administrative proceedings, government investigations and proceedings, shareholder proceedings, employment and personal injury claims, landlord/ tenant disputes, supplier-related disputes, and claims by current or former franchisees. Regardless of whether claims against us are valid or whether we are found to be liable, claims may be expensive to defend and may divert management's attention away from operations.

Litigation and regulatory action concerning our relationship with franchisees and the legal distinction between our franchisees and us for employment law or other purposes, if determined adversely, could increase costs, negatively impact our business operations and the business prospects of our franchisees and subject us to incremental liability for their actions. Similarly, although our commercial relationships with our suppliers remain independent, there may be attempts to challenge that independence, which, if determined adversely, could also increase costs, negatively impact the business prospects of our suppliers, and subject us to incremental liability for their actions.

Our results could also be affected by the following:

•The relative level of our defense costs, which vary from period to period depending on the number, nature and procedural status of pending proceedings;

•The cost and other effects of settlements, judgments or consent decrees, which may require us to make disclosures or take other actions that may affect perceptions of our brand and products; and

•Adverse results of pending or future litigation, including litigation challenging the composition and preparation of our products, or the appropriateness or accuracy of our marketing or other communication practices.

A judgment significantly in excess of any applicable insurance coverage or third-party indemnity could materially adversely affect our financial condition or results of operations. Further, adverse publicity resulting from claims may hurt our business. If we are unable to effectively manage the risks associated with our complex regulatory and legal environment, it could have a material adverse effect on our business and financial condition.

Changes in tax laws and unanticipated tax liabilities could adversely affect the taxes we pay and our profitability.

We are subject to income and other taxes in the U.S. and foreign jurisdictions, and our operations, plans and results are affected by tax and other initiatives around the world. In particular, we are affected by the impact of changes to tax laws or policy or related authoritative interpretations. We are also impacted by settlements of pending or any future adjustments proposed by taxing and governmental authorities inside and outside of the U.S. in connection with our tax audits, all of which will depend on their timing, nature and scope. Any significant increases in income tax rates, changes in income tax laws or unfavorable resolution of tax matters could have a material adverse impact on our financial results.

Changes in accounting standards or the recognition of impairment or other charges may adversely affect our future operations and results.

New accounting standards or changes in financial reporting requirements, accounting principles or practices, including with respect to our critical accounting estimates, could adversely affect our future results. We may also be affected by the nature and timing of decisions about underperforming markets or assets, including decisions that result in impairment or other charges that reduce our earnings. In assessing the recoverability of our long-lived assets, we consider changes in economic conditions and make assumptions regarding estimated future cash flows and other factors. These estimates are highly subjective and can be significantly impacted by many factors such as global and local business and economic conditions, operating costs, inflation, competition, consumer and demographic trends, and our restructuring activities. If our estimates or underlying assumptions change in the future, we may be required to record impairment charges. If we experience any such changes, they could have a significant adverse effect on our reported results for the affected periods.

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If we fail to comply with privacy and data collection laws, we could be subject to legal proceedings and penalties, which could negatively affect our financial results or brand perceptions.

We are subject to legal and compliance risks and associated liability related to privacy and data collection, protection and management, as it relates to information associated with our technology-related services and platforms made available to business partners, customers, employees, franchisees or other third parties. For example, the General Data Protection Regulation (“GDPR”) requires entities processing the personal data of individuals in the European Union to meet certain requirements regarding the handling of that data. We are also subject to U.S. federal and state and foreign laws and regulations in this area such as the California Consumer Privacy Act (“CCPA”). These regulations have been subject to frequent change, and there may be markets or jurisdictions that propose or enact new or emerging data privacy requirements in the future. Failure to comply with GDPR, CCPA or other privacy and data collection laws could result in legal proceedings and substantial penalties, and materially adversely impact our financial results or brand perceptions.

MACROECONOMIC AND MARKET CONDITIONS

Unfavorable general economic conditions could adversely affect our business and financial results.

Our results of operations are substantially affected by economic conditions, including inflationary pressures, which can vary significantly by market and can impact consumer disposable income levels and spending habits. Economic conditions can also be impacted by a variety of factors including hostilities, epidemics, pandemics and actions taken by governments to manage national and international economic matters, whether through austerity, stimulus measures or trade measures, and initiatives intended to control wages, unemployment, credit availability, inflation, taxation and other economic drivers. Sustained adverse economic conditions or periodic adverse changes in economic conditions in our markets could pressure our operating performance and our business continuity disruption planning, and our business and financial results may suffer.

Our results of operations are also affected by fluctuations in currency exchange rates and unfavorable currency fluctuations could adversely affect reported earnings.

Changes in commodity and other operating costs could adversely affect our results of operations.

The profitability of our Company-operated restaurants depends in part on our ability to anticipate and react to changes in commodity costs, including food, paper, supplies, fuel, utilities and distribution, and other operating costs, including labor. Any volatility in certain commodity prices or fluctuation in labor costs could adversely affect our operating results by impacting restaurant profitability. The commodity markets for some of the ingredients we use, such as beef and chicken, are particularly volatile due to factors such as seasonal shifts, climate conditions, industry demand, international commodity markets, food safety concerns, product recalls and government regulation, all of which are beyond our control and, in many instances, unpredictable. Our System can only partially address future price risk through hedging and other activities, and therefore increases in commodity costs could have an adverse impact on our profitability.

A decrease in our credit ratings or an increase in our funding costs could adversely affect our profitability.

Our credit ratings may be negatively affected by our results of operations or changes in our debt levels. As a result, our interest expense, the availability of acceptable counterparties, our ability to obtain funding on favorable terms, collateral requirements and our operating or financial flexibility could all be negatively affected, especially if lenders impose new operating or financial covenants.

Our operations may also be impacted by regulations affecting capital flows, financial markets or financial institutions, which can limit our ability to manage and deploy our liquidity or increase our funding costs. If any of these events were to occur, they could have a material adverse effect on our business and financial condition.

Trading volatility and the price of our common stock may be adversely affected by many factors.

Many factors affect the volatility and price of our common stock in addition to our operating results and prospects. The most important of these factors, some of which are outside our control, are the following:

•The unpredictable nature of global economic and market conditions;

•Governmental action or inaction in light of key indicators of economic activity or events that can significantly influence financial markets, particularly in the U.S., which is the principal trading market for our common stock, and media reports and commentary about economic, trade or other matters, even when the matter in question does not directly relate to our business;

•Trading activity in our common stock or trading activity in derivative instruments with respect to our common stock or debt securities, which can be affected by market commentary (including commentary that may be unreliable or incomplete); unauthorized disclosures about our performance, plans or expectations about our business; our actual performance and creditworthiness; investor confidence, driven in part by expectations about our performance; actions by shareholders and others seeking to influence our business strategies; portfolio transactions in our stock by significant shareholders; or trading activity that results from the ordinary course rebalancing of stock indices in which McDonald’s may be included, such as the S&P 500 Index and the Dow Jones Industrial Average;

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•The impact of our stock repurchase program or dividend rate; and

•The impact on our results of corporate actions and market and third-party perceptions and assessments of such actions, such as those we may take from time to time as we implement our strategies, including through acquisitions, in light of changing business, legal and tax considerations and evolve our corporate structure.

Events such as severe weather conditions, natural disasters, hostilities and social unrest, among others, can adversely affect our results and prospects.

Severe weather conditions, natural disasters, hostilities and social unrest, climate change or terrorist activities (or expectations about them) can adversely affect consumer spending and confidence levels and supply availability and costs, as well as the local operations in impacted markets, all of which can affect our results and prospects. Our receipt of proceeds under any insurance we maintain with respect to some of these risks may be delayed or the proceeds may be insufficient to cover our losses fully.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There were no material changes to the disclosures made in our Annual Report on Form 10-K for the year ended December 31, 2020 regarding this matter.

Item 4. Controls and Procedures

Disclosure Controls

An evaluation was conducted under the supervision and with the participation of the Company’s management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")) as of June 30, 2021. Based on that evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures were effective as of such date to provide reasonable assurances that information required to be disclosed by the Company in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and is accumulated and communicated to the Company's management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting

The Company's management, including the CEO and CFO, confirm there was no change in the Company's internal control over financial reporting during the quarter ended June 30, 2021 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

There were no material changes to the disclosure made in our Annual Report on Form 10-K for the year ended December 31, 2020 regarding these matters.

Item 1A. Risk Factors

For a discussion of risk factors affecting our business, refer to statements appearing under the caption “Risk Factors and Cautionary Statement Regarding Forward-Looking Statements” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 of this Form 10-Q.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities*

The following table presents information related to repurchases of common stock the Company made during the quarter ended June 30, 2021:

Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)
April 1-30, 2021	2,430	$	230.82	2,430	$	14,103,786,081
May 1-31, 2021	5,891	229.22		5,891	14,102,435,744
June 1-30, 2021	4,435	231.49		4,435	14,101,409,092
Total	12,756	$	230.31	12,756

*    Subject to applicable law, the Company may repurchase shares directly in the open market, in privately negotiated transactions or pursuant to derivative instruments and plans complying with Rule 10b5-1 under the Exchange Act, among other types of transactions and arrangements.

(1)On December 31, 2019, the Company's Board of Directors approved a share repurchase program, effective January 1, 2020, that authorized the purchase of up to $15 billion of the Company's outstanding common stock. The Company did not repurchase any shares in the open market during the quarter. Therefore, the table above reflects only shares withheld for taxes under the Company’s equity compensation program.

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Item 6. Exhibits
Exhibit Number			Description
	(3)	(a)	Restated Certificate of Incorporation, effective as of May 23, 2019, incorporated herein by reference from Exhibit 3(a) of Form 10-Q (File No. 001-05231), filed August 6, 2019.
		(b)	By-Laws, as amended and restated with effect as of December 6, 2019, incorporated herein by reference from Exhibit 3 of Form 8-K (File No. 001-05231), filed December 10, 2019.
	(4)	Instruments defining the rights of security holders, including Indentures:*
		(a)	Senior Debt Securities Indenture, dated as of October 19, 1996, incorporated herein by reference from Exhibit (4)(a) of Form S-3 Registration Statement (File No. 333-14141), filed October 15, 1996.
		(b)	Subordinated Debt Securities Indenture, dated as of October 18, 1996, incorporated herein by reference from Exhibit (4)(b) of Form S-3 Registration Statement (File No. 333-14141), filed October 15, 1996.
	(10)	Material Contracts
		(a)	Directors' Deferred Compensation Plan, amended and restated effective as of May 26, 2016, incorporated herein by reference from Exhibit 10(a)(i) of Form 10-Q (File No. 001-05231), for the quarter ended June 30, 2016.**
		(b)	McDonald’s Deferred Compensation Plan, effective January 1, 2017, incorporated herein by reference from Exhibit 10(b) of Form 10-K (file No. 001-05231), for the year ended December 31, 2016.**
			(i)	First Amendment to the McDonald's Deferred Compensation Plan, effective as of May 1, 2018, incorporated herein by reference from Exhibit 10(b)(i) of Form 10-Q (File No. 001-05231), for the quarter ended September 30, 2018.**
		(c)	McDonald's Amended and Restated Deferred Compensation Plan, effective as of May 26, 2020, incorporated herein by reference from Exhibit 10(c) of Form 10-Q (File No. 001-05231), for the quarter ended June 30, 2020.**
		(d)	McDonald’s Corporation Supplemental Profit Sharing and Savings Plan, effective as of September 1, 2001, incorporated herein by reference from Exhibit 10(c) of Form 10-K (File No. 001-05231), for the year ended December 31, 2001.**
			(i)	First Amendment to the McDonald’s Corporation Supplemental Profit Sharing and Savings Plan, effective as of January 1, 2002, incorporated herein by reference from Exhibit 10(c)(i) of Form 10-K (File No. 001-05231), for the year ended December 31, 2002.**
			(ii)	Second Amendment to the McDonald’s Corporation Supplemental Profit Sharing and Savings Plan, effective January 1, 2005, incorporated herein by reference from Exhibit 10(c)(ii) of Form 10-K (File No. 001-05231), for the year ended December 31, 2004.**
		(e)	McDonald’s Corporation Amended and Restated 2001 Omnibus Stock Ownership Plan, effective July 1, 2008, incorporated herein by reference from Exhibit 10(h) of Form 10-Q (File No. 001-05231), for the quarter ended June 30, 2009.**
			(i)	First Amendment to the McDonald’s Corporation Amended and Restated 2001 Omnibus Stock Ownership Plan, incorporated herein by reference from Exhibit 10(h)(i) of Form 10-K (File No. 001-05231), for the year ended December 31, 2008.**
			(ii)	Second Amendment to the McDonald’s Corporation Amended and Restated 2001 Omnibus Stock Ownership Plan as amended, effective February 9, 2011, incorporated herein by reference from Exhibit 10(h)(ii) of Form 10-K (File No. 001-05231), for the year ended December 31, 2010.**
		(f)	McDonald's Corporation 2012 Omnibus Stock Ownership Plan, effective June 1, 2012, incorporated herein by reference from Exhibit 10(h) of Form 10-Q (File No. 001-05231), for the quarter ended September 30, 2012.**
		(g)	McDonald's Corporation Amended and Restated 2012 Omnibus Stock Ownership Plan, effective May 21, 2020, incorporated herein by reference from Exhibit 10(g) of Form 10-Q (File No. 001-05231), for the quarter ended June 30, 2020.**
		(h)	Form of Executive Stock Option Grant Agreement in connection with the Amended and Restated 2001 Omnibus Stock Ownership Plan, as amended, incorporated herein by reference from Exhibit 10(j) of Form 10-K (File No. 001-05231), for the year ended December 31, 2011.**
		(i)	Form of 2013 Executive Stock Option Award Agreement in connection with the 2012 Omnibus Stock Ownership Plan, incorporated herein by reference from Exhibit 10(n) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2013.**
		(j)	Form of 2014 Executive Stock Option Award Agreement in connection with the 2012 Omnibus Stock Ownership Plan, incorporated herein by reference from Exhibit 10(z) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2014.**

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	(k)	Form of Executive Confidentiality, Intellectual Property and Restrictive Covenant Agreement, incorporated herein by reference from Exhibit 10(o) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2017.**
	(l)	Form of 2018 Executive Stock Option Award Agreement in connection with the 2012 Omnibus Stock Ownership Plan, incorporated herein by reference from Exhibit 10(q) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2018. **
	(m)	Separation Agreement and General Release between Douglas Goare and the Company, dated January 7, 2019, incorporated herein by reference from Exhibit 10(r) of Form 10-K (File No. 001-05231), for the year ended December 31, 2018. **
	(n)	McDonald's Corporation Target Incentive Plan, effective as of January 1, 2013, as Amended and Restated February 13, 2019, incorporated herein by reference from Exhibit 10(p) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2019.**
	(o)	McDonald's Corporation Officer Severance Plan, as Amended and Restated, effective January 1, 2019, incorporated herein by reference from Exhibit 10(q) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2019.**
	(p)	Form of 2019 Executive Stock Option Award Agreement in connection with the 2012 Omnibus Stock Ownership Plan, incorporated herein by reference from Exhibit 10(r) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2019.**
	(q)	Form of 2019 Executive Performance-Based Restricted Stock Unit Award Agreement in connection with the 2012 Omnibus Stock Ownership Plan, incorporated herein by reference from Exhibit 10(s) of Form 10-Q (File No. 001-05231), for the quarter ended March 31, 2019.**
	(r)	Separation Agreement and General Release between Stephen Easterbrook and the Company, dated October 31, 2019, incorporated herein by reference from Exhibit 10.1 of Form 8-K (File No. 001-05231), filed November 4, 2019.
	(s)	Separation Agreement and General Release between Silvia Lagnado and the Company, dated August 14, 2019, incorporated herein by reference from Exhibit 10(t) of Form 10-Q (File No. 001-05231), for the quarter ended June 30, 2020.**
	(t)	Separation Agreement and General Release between Silvia Lagnado and the Company, dated October 31, 2019, incorporated herein by reference from Exhibit 10(u) of Form 10-Q (File No. 001-05231), for the quarter ended June 30, 2020.**
	(u)	Separation Agreement and General Release between Jerome N. Krulewitch and the Company, dated October 13, 2020, incorporated herein by reference from Exhibit 10(v) of Form 10-K (File No. 001-05231), for the year ended December 31, 2020.**
	(v)	Form of Executive Time-Based Restricted Stock Unit Award Agreement in connection with the Amended and Restated 2012 Omnibus Stock Ownership Plan, filed herewith.**
(31.1)	Rule 13a-14(a) Certification of Chief Executive Officer.
(31.2)	Rule 13a-14(a) Certification of Chief Financial Officer.
(32.1)	Certification pursuant to 18 U.S.C. Section 1350 by the Chief Executive Officer, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(32.2)	Certification pursuant to 18 U.S.C. Section 1350 by the Chief Financial Officer, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(101.INS)	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
(101.SCH)	Inline XBRL Taxonomy Extension Schema Document.
(101.CAL)	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
(101.DEF)	Inline XBRL Taxonomy Extension Definition Linkbase Document.
(101.LAB)	Inline XBRL Taxonomy Extension Label Linkbase Document.
(101.PRE)	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
(104)	Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.

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*

Other instruments defining the rights of holders of long-term debt of the registrant, and all of its subsidiaries for which consolidated financial statements are required to be filed and which are not required to be registered with the Commission, are not included herein as the securities authorized under these instruments, individually, do not exceed 10% of the total assets of the registrant and its subsidiaries on a consolidated basis. An agreement to furnish a copy of any such instruments to the Commission upon request has been filed with the Commission.

**

Denotes compensatory plan.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		McDONALD’S CORPORATION         (Registrant)
		/s/ Kevin M. Ozan
Date:	August 4, 2021	Kevin M. Ozan
		Corporate Executive Vice President and Chief Financial Officer

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EX-10.V

Exhibit 10(v)

McDONALD’S CORPORATION

AMENDED AND RESTATED 2012 OMNIBUS STOCK OWNERSHIP PLAN

TIME-BASED RESTRICTED STOCK UNIT AWARD AGREEMENT

EXECUTIVE OFFICERS

McDONALD’S CORPORATION (the “Company” or “McDonald’s”), hereby grants to the individual named in the chart below (the “Grantee”), the number of restricted stock units (“RSUs”) with respect to shares of the Company’s Stock set forth in the chart below. Each RSU represents the equivalent in value of one share of Stock. The RSUs shall vest according to the vesting schedule and termination provisions described below in this Restricted Stock Unit Award Agreement, including any Appendices (the “Agreement”). The RSUs shall be subject to the terms and conditions set forth in this Agreement and in the McDonald’s Corporation Amended and Restated 2012 Omnibus Stock Ownership Plan (the “Plan”).

Capitalized terms not otherwise defined in this Agreement shall have the meaning provided in the Plan. The Plan is incorporated into, and made a part of, this Agreement.

Important Notice: If the Grantee does not wish to receive the RSUs and/or does not consent and agree to the terms and conditions on which the RSUs are offered, as set forth in this Agreement and the Plan, then the Grantee must reject the RSUs via the Merrill Lynch website at www.benefits.ml.com no later than 60 days following the Grant Date specified in the chart below. If the Grantee rejects the RSUs, the RSUs will be cancelled. The Grantee’s failure to reject the RSUs within this 60 day period will constitute the Grantee’s acceptance of the RSUs and the Grantee’s agreement with all terms and conditions of the RSUs, as set forth in this Agreement and the Plan.

The Grantee:
Number of RSUs:
Grant Date:	May 17, 2021
Vesting Schedule:	100% on the third anniversary of the Grant Date
Vesting Period:	May 17, 2021 – May 17, 2024

1.Vesting of RSUs. As set forth in the chart above, the RSUs will vest on the third anniversary of the Grant Date (the “Vesting Date”), as long as the Grantee remains continuously employed by the Company or a Subsidiary until the Vesting Date, unless otherwise provided by Sections 5 or 8 below. The Grantee will have no rights to the shares of Stock until the RSUs have vested. Prior to settlement, the RSUs represent an unfunded and unsecured obligation of the Company.

2.Settlement of RSUs. On the Vesting Date, or no later than 90 days thereafter, the Company will issue and deliver to the Grantee (at the Company’s sole discretion) either the number of shares of Stock equal to the number of vested RSUs or the cash equivalent value based on the New York Stock Exchange closing price of a share of Stock on the Vesting Date (or if the Vesting Date is a date on which the Stock is not traded, based on the closing price on the last date immediately preceding the Vesting Date on which the Stock was traded), subject to satisfaction of applicable tax and/or other obligations as described in Section 7 below. Notwithstanding the foregoing, if the RSUs vest upon the Grantee’s Termination of Employment, the RSUs will be settled within 90 days of the Grantee’s Termination of Employment, and if the RSUs vest upon a Change in Control, the RSUs will be

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settled as provided in Section 8(a) below, unless otherwise provided in Section 10 below. For purposes of the settlement timing provisions of this Section 2 and Sections 8 and 10 below, if the 60th or 90th day, as applicable, following the settlement event is not a business day, the vested RSUs will be settled on or prior to the business day immediately preceding the 60th or 90th day, as applicable.

3.Dividend Equivalents. Until such time as the RSUs vest in full, the Grantee shall be credited with an amount equal to all cash and stock dividends (whether ordinary or extraordinary) (“Dividend Equivalents”) that would have been paid to the Grantee if one share of Stock had been issued on the Grant Date for each RSU granted to the Grantee as set forth in this Agreement and that remains outstanding. In its discretion, the Company may reinvest any cash Dividend Equivalents into additional shares of Stock. Dividend Equivalents shall be subject to the same vesting restrictions, forfeiture and other conditions as the RSUs to which they are attributable and shall be paid, if at all, on the same date that the RSUs to which they are attributable are settled in accordance with Section 2 hereof. Dividend Equivalents that are held for the benefit of the Grantee shall be distributed in cash or in the discretion of the Company, in shares of Stock based on the closing price of a share of Stock on the Vesting Date.

4.Rights as a Stockholder. If the RSUs and any Dividend Equivalents are settled in shares of Stock, upon and following the date of such settlement, the Grantee shall be the record owner of the shares of Stock underlying the RSUs and any Dividend Equivalents unless and until such shares are sold or otherwise disposed of, and shall be entitled to all of the rights of a stockholder of the Company including the right to vote such shares and receive all dividends or other distributions paid with respect to such shares. Notwithstanding the foregoing, any dividends or other distributions shall be subject to the same restrictions, including transferability and vesting, as the underlying shares of Stock.

The treatment of the RSUs upon Termination of Employment is governed by Section 5 below for all Grantees.

5.Termination of Employment. For purposes of this Section 5, the date of Termination of Employment will be the last date that the Grantee is classified as an employee in the payroll system of the Company or applicable Subsidiary, provided that in the case of a Grantee who is subject to U.S. federal income tax (a “U.S. Taxpayer”), the date of Termination of Employment will be the date that the Grantee experiences a “separation from service,” in accordance with the requirements of Code Section 409A. The Company shall have the exclusive discretion to determine when the Grantee is no longer employed for purposes of the RSUs and any Dividend Equivalents, this Agreement and the Plan. Subject to Section 6:

(a)Termination within Four Months of the Grant Date. If the Grantee has a Termination of Employment for any reason other than (i) death or Disability or (ii) to work for a developmental licensee, prior to the four-month anniversary of the Grant Date, the RSUs and any Dividend Equivalents will be immediately forfeited.

(b)Termination for Cause or Policy Violation. If the Grantee has a Termination of Employment for Cause, including on account of a Policy Violation (as determined by the Committee or its delegee in its sole and absolute discretion), the RSUs and Dividend Equivalents will be immediately forfeited. For purposes of this Agreement, “Policy Violation” means Termination of Employment resulting from the commission of any act or acts which violate the Standards of Business Conduct of the Company or a Subsidiary or any successor thereto

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(including underlying policies or policies specifically referenced therein), as the same is in effect and applicable to the Grantee at the time of the Grantee’s violation.

(c)Termination on Account of Death or Disability. If the Grantee has a Termination of Employment on account of death or Disability (even during the first four months following the Grant Date), the RSUs and any Dividend Equivalents will immediately vest upon such Termination of Employment (such date, if applicable, also a Vesting Date) and will be settled in accordance with Section 2 above, unless otherwise provided in Section 11(b) below.

(d)Termination with At Least 68 Years of Combined Age and Service. If the Grantee voluntarily terminates employment and (i) the Grantee’s combined age and years of Company Service (which means the Grantee’s aggregate number of years of employment with the Company and any Subsidiary including employment with any Subsidiary during the period before it became a Subsidiary) is equal to or greater than 68, (ii) the Grantee provides four months advance written notice of his or her intention to terminate employment to both the Corporate Vice President – Global Total Rewards and the Grantee’s manager, (iii) the Grantee executes and delivers (and does not revoke) a release agreement satisfactory to the Company and (iv) the Grantee executes and delivers a non-competition agreement satisfactory to the Company (as the Committee or its delegee may require):

(i)    In the event that Termination of Employment occurs on or after the four month anniversary of the Grant Date but prior to the 12 month anniversary of the Grant Date, 50% of the RSUs and their corresponding Dividend Equivalents shall vest (and the remaining 50% and their corresponding dividend equivalents shall be forfeited); or

(ii)    In the event that Termination of Employment occurs on or after the 12 month anniversary of the Grant Date, all of the RSUs and Dividend Equivalents shall vest.

Settlement of the vested RSUs and Dividend Equivalents vesting pursuant to (i) or (ii) above will occur in accordance with Section 2 above, unless otherwise provided in Section 10(a) or (b) below. If the Grantee executes and delivers a non-competition agreement, and then violates the provisions of that agreement, the Company may seek to administratively or judicially enforce the covenants under the non-competition agreement and any failure to enforce that right does not waive that right.

(e)Termination on Account of Special Circumstances or Disaffiliation of a Subsidiary. If the Grantee has a Termination of Employment due to Special Circumstances (which means, a Termination of Employment due to the Grantee becoming an owner-operator of a McDonald’s restaurant in connection with his or her Termination of Employment or a Termination of Employment by the Company or a Subsidiary without Cause) or a Disaffiliation of a Subsidiary and (i) in the case of a Termination of Employment due to Special Circumstances only, the Grantee’s combined age and years of Company Service (as defined above) is equal to or greater than 48, (ii) the Grantee executes and delivers (and does not revoke) a release agreement satisfactory to the Company and (iii) the Grantee executes and delivers a non-competition agreement in a form satisfactory to the Company as permitted by applicable law (as the Committee or its delegee may require), a pro-rata portion of the RSUs and any Dividend Equivalents shall vest, as determined in accordance with Section 6 below. Settlement of the vested RSUs and Dividend Equivalents will occur in accordance with Section 2 above, unless otherwise provided in Section 10(a) or (b) below. For purposes of this Agreement, “Disaffiliation of a Subsidiary” means the Subsidiary’s ceasing to be a Subsidiary for any reason (including,

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without limitation, as a result of a public offering, or a spinoff or sale by the Company, of the stock or all of the assets of the Subsidiary).

(f)Termination with Company Approval to Work for a Developmental Licensee. If the Grantee has a Termination of Employment in order to work for a developmental licensee (even during the first four months following the Grant Date) and (i) the Company approves of the Grantee’s resignation, (ii) the Grantee executes and delivers (and does not revoke) a release agreement satisfactory to the Company and (iii) the Grantee executes and delivers a non-competition agreement covering a period of 12 months in a form satisfactory to the Company as permitted by applicable law (as the Committee or its delegee may require), all of the RSUs and any Dividend Equivalents shall vest. Settlement of the vested RSUs and Dividend Equivalents will occur in accordance with Section 2 above, unless otherwise provided in Section 10(a) or (b) below. If the Grantee executes and delivers a non-competition agreement, and then violates the provisions of that agreement, the Company may seek to administratively or judicially enforce the covenants under the non-competition agreement and any failure to enforce that right does not waive that right.

(g)Any Other Reason. If the Grantee has a Termination of Employment for a reason other than those specified in Sections 5(a)-(f) above, all unvested RSUs and Dividend Equivalents shall be immediately forfeited.

(h)Selection of Rule. If the Grantee’s Termination of Employment is covered by more than one of the foregoing rules, the applicable rule that is the most favorable to the Grantee shall apply, except that (i) in the case of a Termination of Employment as described in Section 5(a), Section 5(a) shall apply; (ii) in the case of a Termination of Employment as described in Section 5(b), Section 5(b) shall apply; and (iii) in the case of a Termination of Employment as described in Section 5(f), Section 5(f) shall apply.

6.Pro-Rata Vesting Formula. The number of RSUs and any Dividend Equivalents that shall vest on a pro-rata basis as the result of the Grantee’s Termination of Employment in accordance with Section 5(e) above is determined by multiplying the number of RSUs granted to the Grantee (as set forth on the first page of this Agreement) and Dividend Equivalents as applicable by the number of months (counting partial months as whole months) from the Grant Date through the date of the Grantee’s Termination of Employment, and dividing the product by the total number of months between the Grant Date and the Vesting Date, as is illustrated below:

Number of Granted RSUs and Dividend Equivalents x Number of Months Worked in Vesting

Period

Total Number of Months in Vesting Period (36 months)

Any fractional share amount determined upon application of the above formula will be rounded up to the next whole share.

7.Responsibility for Taxes.

(a)    Grantee’s Liability for Tax-Related Items. Except to the extent prohibited by law, the Grantee acknowledges that regardless of any action the Company or, if different, the Grantee’s employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related

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to the Grantee’s participation in the Plan and legally applicable to the Grantee or deemed by the Company or the Employer in their discretion to be an appropriate charge to the Grantee even if legally applicable to the Company or the Employer (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility and may exceed the amount actually withheld by the Company or the Employer, if any. The Grantee further acknowledges that the Company and/or the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the RSUs and any Dividend Equivalents, including the grant, vesting or settlement of the RSUs and any Dividend Equivalents, the subsequent sale of any shares of Stock acquired as a result of such settlement and/or the receipt of any dividends after settlement; and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of the RSUs and any Dividend Equivalents to reduce or eliminate the Grantee’s liability for Tax-Related Items or achieve any particular tax result. Furthermore, the Grantee acknowledges that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

(b)    Tax-Related Items Withholding Procedures. The Grantee authorizes the use of the withholding procedures set forth below in this subsection (b) to satisfy all Tax-Related Items obligations of the Company and/or the Employer that may arise upon the vesting of the RSUs and any Dividend Equivalents or any other taxable or tax withholding event. In the event that any amount of such Tax-Related Items cannot be satisfied by the means set forth in this subsection (b), the Grantee shall be required to pay such amount to the Company or the Employer. The Company shall not be required to issue or deliver the shares of Stock or the cash equivalent (if applicable) if the Grantee fails to comply with his or her obligations in connection with the Tax-Related Items. Further, the Company may withhold or account for Tax-Related Items by considering minimum statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case the Grantee will receive a refund of any over-withheld amount in cash and will have no entitlement to the Stock equivalent.

(i)    Stock Settlement. If the RSUs and any Dividend Equivalents are settled in shares of Stock and the Grantee is not subject to the short-swing profit rules of Section 16(b) of the 1934 Act, the Grantee authorizes the Company to satisfy the obligations with regard to all Tax-Related Items by withholding shares of Stock that would otherwise be issued upon settlement of the RSUs and any Dividend Equivalents. Alternatively, or in addition, the Grantee authorizes the Company and/or the Employer, or their respective agents, at their discretion, to satisfy the obligations with regard to Tax-Related Items by one or a combination of the following: (A) withholding from proceeds of the sale of shares of Stock acquired upon settlement of the RSUs and any Dividend Equivalents, either through a voluntary sale or through a mandatory sale arranged by the Company (on the Grantee’s behalf pursuant to this authorization); or (B) withholding from the Grantee’s wages or other cash compensation paid to the Grantee by the Company and/or the Employer. If the RSUs and any Dividend Equivalents are settled in shares of Stock and the Grantee is subject to the short-swing profit rules of Section 16(b) of the 1934 Act, the Company will withhold shares of Stock upon the relevant tax withholding event, unless the use of such withholding method is prevented by applicable law or has materially adverse accounting or tax consequences, in which case, the withholding obligation for any Tax Related Items may be satisfied by one or a combination of methods (A) and (B) above.

If the obligation for Tax-Related Items is satisfied by withholding in shares of Stock, for tax purposes, the Grantee is deemed to have been issued the full number of shares of Stock subject to the vested RSUs and any Dividend Equivalents, notwithstanding that a number

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of the shares of Stock are held back solely for the purpose of paying the applicable Tax-Related Items.

(ii)    Cash Settlement. If the RSUs are settled in cash, the Grantee authorizes the Company and/or the Employer, or their respective agents, at their discretion, to satisfy any obligation for Tax-Related Items by withholding from the cash amount paid to the Grantee in settlement of the RSUs and any Dividend Equivalents, or from the Grantee’s wages or other cash compensation paid to the Grantee by the Company and/or the Employer.

8.Change in Control.

(a)    Treatment of RSUs and Dividend Equivalents Upon a Change in Control. In the event of a Change in Control, notwithstanding any other provision of this Agreement, the RSUs and the related Dividend Equivalents will immediately vest upon such Change in Control (such date, if applicable, also a Vesting Date) and be settled at such time or within 60 days after the Change in Control if (i) after such Change in Control, the Stock ceases to be publicly-traded and (ii) the Grantee does not receive Replacement Awards with respect to the RSUs and any Dividend Equivalents. Notwithstanding the foregoing, if the Change in Control does not qualify as a change in control for purposes of Code Section 409A, any RSUs and Dividend Equivalents held by a U.S. Taxpayer will be settled within 90 days following the earliest of (A) the Vesting Date; (B) the Grantee’s Termination of Employment (or the date that is six months after the Grantee’s Termination of Employment if the Grantee is a Specified Employee, as defined in Section 10(b) below) or (C) the Grantee’s death or “disability” within the meaning of Code Section 409A.

(b)    Termination After Change in Control. If the immediate vesting described in the preceding paragraph does not apply, but the Company or a Subsidiary terminates the Grantee’s employment for any reason other than Cause within two years following the Change in Control, the RSUs and the related Dividend Equivalents will immediately vest upon such Termination of Employment (such date, if applicable, also a Vesting Date) and will be settled within 90 days of Termination of Employment in accordance with Section 2 above, unless otherwise provided in Section 10(b) below.

9.Settlement Upon Death of the Grantee. In any case under this Agreement in which the RSUs are to be settled following the Grantee’s death, the shares of Stock or cash due in settlement of the RSUs and any Dividend Equivalents shall be issued to (i) the Grantee’s personal representative or the person to whom the RSUs and any Dividend Equivalents are transferred by will or the applicable laws of descent and distribution or (ii) the Grantee’s beneficiary designated in accordance with Section 8 of the Plan.

10.Code Section 409A.

(a)    Settlement Conditioned upon Termination Requirements. Notwithstanding any provision in this Agreement to the contrary (but except as provided in Section 10(b) hereof), in the event that (i) the vesting and settlement of RSUs and any Dividend Equivalents in connection with a Termination of Employment is conditioned on the Grantee’s execution and delivery of a release or a non-competition agreement and (ii) the settlement period commences in one calendar year and ends in the next calendar year (where the portion of the settlement period in the next calendar year contains at least one business day), the RSUs and any Dividend Equivalents held by a U.S. Taxpayer will be settled in the second calendar year.

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(b)    Specified Employee Termination of Employment. Notwithstanding any provision in this Agreement to the contrary, if the Grantee is a U.S. Taxpayer and a specified employee under the Company’s Specified Key Employee Policy (Grantees meeting both criteria are referred to herein as “Specified Employees”) on the date of the Grantee’s Termination of Employment, any settlement of the RSUs and any Dividend Equivalents that the Grantee is entitled to receive under this Agreement upon Termination of Employment will be made as follows:

(i)    Settlement Due to Termination Pursuant to Section 5. If the Grantee’s Termination of Employment is covered by (1) Section 5(c) and the Grantee’s Disability does not constitute a “disability” for purposes of Code Section 409A, or (2) Sections 5(d) through 5(f), the RSUs and any Dividend Equivalents will be settled within 90 days following the later of (A) the Vesting Date and (B) the date that is six months after the Grantee’s Termination of Employment; however, in the event of the Grantee's death, then upon the date of the Grantee’s death. For avoidance of doubt, if the Grantee’s Termination of Employment is covered by Section 5(c) and the Grantee’s Disability does constitute a “disability” for purposes of Code Section 409A, then the Grantee’s vested RSUs and any Dividend Equivalents will be settled within 90 days of the Grantee’s Termination of Employment.

(ii)    Settlement Due to Termination After Change in Control. If the Grantee’s Termination of Employment is covered by Section 8(b), the RSUs and any Dividend Equivalents will be settled within 90 days following the later of (A) the Vesting Date and (B) the date that is six months after the Grantee’s Termination of Employment; however, in the event of the Grantee’s death, then upon the date of the Grantee’s death.

(c)    No Company Liability. All RSUs and any Dividend Equivalents granted hereunder are intended to be compliant with Code Section 409A, and this Agreement and the Plan shall be interpreted, construed and operated to reflect this intent. Notwithstanding the foregoing, this Agreement and the Plan may be amended at any time, without the consent of any party, to the extent that is necessary or desirable to satisfy any of the requirements under Code Section 409A, but the Company shall not be under any obligation to make any such amendment. Nothing in this Agreement or the Plan shall provide a basis for any person to take action against the Company or any Subsidiary based on matters covered by Code Section 409A, including the tax treatment of any amount paid or RSUs and any Dividend Equivalents granted under this Agreement, and neither the Company nor any of its Subsidiaries shall under any circumstances have any liability to the Grantee or his or her estate or any other party for any taxes, penalties or interest due on amounts paid or payable under this Agreement, including taxes, penalties or interest imposed under Code Section 409A.

11.Repayment/Forfeiture.

(a)Compliance with Applicable Law and/or Company Clawback Policy. Any benefits the Grantee may receive hereunder shall be subject to repayment or forfeiture as may be required to comply with (i) any applicable listing standards of a national securities exchange adopted in accordance with Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (regarding recovery of erroneously awarded compensation) and any implementing rules and regulations of the U.S. Securities and Exchange Commission adopted thereunder, (ii) similar rules under the laws of any other jurisdiction and (iii) any policies adopted by the Company to implement such requirements, all to the extent determined by the Company in its discretion to be applicable to the Grantee.

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(b)Detrimental Conduct. Any RSUs and any Dividend Equivalents granted pursuant to this Agreement and the Plan are intended to align the Grantee’s long-term interests with the long-term interests of the Company. If the Company determines that the Grantee has (i) engaged in willful fraud that causes harm to the Company or any of its Subsidiaries or that is intended to manipulate the Performance Goals, either during employment with the Company or after such employment terminates for any reason or (ii) violated the provisions of a non-competition agreement (any such act shall be referred to as “Detrimental Conduct”), the Grantee shall be deemed to have acted contrary to the long-term interests of the Company. Accordingly, the following rules shall apply:

(i)In the event that the Company determines, in its sole and absolute discretion, that the Grantee engaged in Detrimental Conduct, the Company may, in its sole and absolute discretion, (A) terminate such Grantee’s participation in the Plan and/or (B) send a notice of recapture (a “Recapture Notice”) that (1) cancels all or a portion of any future-vesting or settling RSUs and Dividend Equivalents, (2) requires the return of any cash or shares of Stock received at settlement upon or after vesting of the RSUs and any Dividend Equivalents and/or (3) requires the reimbursement to the Company of any net proceeds received from the sale of any shares of Stock acquired as a result of such settlement and/or the receipt of any dividends after settlement.

(ii)The Company has sole and absolute discretion to take action or not to take action pursuant to this Section 11 upon determination of Detrimental Conduct, and its decision not to take action in any particular instance shall not in any way limit its authority to send a Recapture Notice in any other instance.

(iii)Upon vesting of any RSUs and Dividend Equivalents, the Grantee shall, if requested by the Company, certify on a form acceptable to the Company, that he or she is not, and has not previously been, engaged in Detrimental Conduct.

(iv)Notwithstanding any provision of this Section 11, if any provision of this Section 11 is determined to be unenforceable or invalid under any applicable law, such provision will be applied to the maximum extent permitted by applicable law, and shall automatically be deemed amended in a manner consistent with its objectives to the extent necessary to conform to any limitations required under applicable law; provided, that this Section 11 shall not apply in any manner to individuals subject to the laws of France.

(v)Any action taken by the Company pursuant to this Section 11 is without prejudice to any other action the Company, or any of its Subsidiaries, may choose to take upon determination that the Grantee has engaged in Detrimental Conduct.

(vi)This Section 11 will cease to apply after a Change in Control.

12.No Employment or Service Contract. Nothing in this Agreement or in the Plan shall confer upon the Grantee any right to continue in the employ of the Company or any Subsidiary for any period of specific duration or interfere with or restrict in any way the right of the Company or any Subsidiary, which is hereby expressly reserved, to remove, terminate or discharge the Grantee at any time for any reason whatsoever, with or without Cause and with or without advance notice.

13.Governing Law and Choice of Venue. The RSUs and any Dividend Equivalents are governed by, and subject to, United States federal and Illinois state law (without

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regard to the conflict of law provisions) and the requirements of the New York Stock Exchange as well as the terms and conditions set forth in the Plan and this Agreement. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by the RSUs and any Dividend Equivalents or this Agreement, the parties hereby submit to and consent to the exclusive jurisdiction of the State of Illinois, agree that such litigation shall be conducted in the courts of DuPage County, Illinois, or the federal courts for the United States for the Northern District of Illinois, where this grant is made and/or to be performed.

14.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means and/or require the Grantee to accept this grant of RSUs and any Dividend Equivalents or any future restricted stock unit grant by electronic means. The Grantee hereby consents to receive such documents by electronic delivery and, if required by the Company, agrees to accept this grant and any future grant of RSUs and any Dividend Equivalents through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

15.Severability. The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.

16.Waiver. The waiver by the Company with respect to compliance of any provision of this Agreement by the Grantee shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach of such party of a provision of this Agreement.

17.Headings. The headings in this Agreement have been inserted for convenience of reference only, and are to be ignored in any construction of the provisions of this Agreement.

18.Appendices. The Appendices constitute part of this Agreement. Notwithstanding the provisions in this Agreement, the RSUs and any Dividend Equivalents shall be subject to any special terms and conditions set forth in the Appendices to this Agreement. Moreover, if the Grantee relocates to one of the jurisdictions included in Appendix C, the special terms and conditions for such jurisdiction will apply to the Grantee, to the extent that the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons.

19.Entire Agreement. This Agreement and the Plan reflect the exclusive agreement between the parties regarding the subject matter herein and supersedes any prior understandings or agreements, whether oral or written, in respect of such subject matter.

BY ACCEPTING THE RSUS, THE GRANTEE AGREES TO THE TERMS OF THIS AGREEMENT AND THE PLAN.

BY:

PRINT NAME:

DATE:

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EX-31.1

Exhibit 31.1

Rule 13a-14(a) Certification of Chief Executive Officer

I, Christopher J. Kempczinski, certify that:

(1)I have reviewed this quarterly report on Form 10-Q of McDonald’s Corporation;

(2)Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3)Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4)The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5)The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2021

/s/ Christopher J. Kempczinski

Christopher J. Kempczinski

President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Rule 13a-14(a) Certification of Chief Financial Officer

I, Kevin M. Ozan, certify that:

(1)I have reviewed this quarterly report on Form 10-Q of McDonald’s Corporation;

(2)Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3)Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4)The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5)The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2021

/s/ Kevin M. Ozan

Kevin M. Ozan

Corporate Executive Vice President and
Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification pursuant to 18 U.S.C. Section 1350 by the Chief Executive Officer, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), the undersigned officer of McDonald’s Corporation (the “Company”), does hereby certify, to such officer’s knowledge, that the Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 4, 2021

/s/ Christopher J. Kempczinski

Christopher J. Kempczinski

President and Chief Executive Officer

EX-32.2

Exhibit 32.2

Certification pursuant to 18 U.S.C. Section 1350 by the Chief Financial Officer, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), the undersigned officer of McDonald’s Corporation (the “Company”), does hereby certify, to such officer’s knowledge, that the Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 4, 2021

/s/ Kevin M. Ozan

Kevin M. Ozan

Corporate Executive Vice President and
Chief Financial Officer

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Document and Entity Information	6 Months Ended
	Jun. 30, 2021 shares
Entity Information [Line Items]
Document Type	10-Q
Document Fiscal Period Focus	Q2
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Amendment Flag	false
Document Fiscal Year Focus	2021
Current Fiscal Year End Date	--12-31
Entity File Number	1-5231
Entity Registrant Name	MCDONALDS CORP
Entity Central Index Key	0000063908
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-2361282
Entity Address, Address Line One	110 North Carpenter Street
Entity Address, City or Town	Chicago,
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60607
City Area Code	630
Local Phone Number	623-3000
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	MCD
Security Exchange Name	NYSE
Entity Common Stock, Shares Outstanding	746,798,875

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Condensed Consolidated Balance Sheet - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Current assets
Cash and equivalents	$ 3,049.4	$ 3,449.1
Accounts and notes receivable	1,808.3	2,110.3
Inventories, at cost, not in excess of market	47.8	51.1
Prepaid expenses and other current assets	795.7	632.7
Total current assets	5,701.2	6,243.2
Other assets
Investments in and advances to affiliates	1,196.8	1,297.2
Goodwill	2,778.1	2,773.1
Miscellaneous	3,889.5	3,527.4
Total other assets	7,864.4	7,597.7
Lease right-of-use asset, net	13,707.3	13,827.7
Property and equipment
Property and equipment, at cost	41,535.5	41,476.5
Accumulated depreciation and amortization	(16,915.3)	(16,518.3)
Net property and equipment	24,620.2	24,958.2
Total assets	51,893.1	52,626.8
Current liabilities
Accounts payable	730.9	741.3
Lease liability	720.4	701.5
Income taxes	281.4	741.1
Other taxes	241.2	227.0
Accrued interest	323.8	388.4
Accrued payroll and other liabilities	1,137.1	1,138.3
Current maturities of long-term debt	500.0	2,243.6
Total current liabilities	3,934.8	6,181.2
Long-term debt	34,922.6	35,196.8
Long-term lease liability	13,119.0	13,321.3
Long-term income taxes	1,865.2	1,970.7
Deferred revenues - initial franchise fees	714.9	702.0
Other long-term liabilities	1,077.2	1,054.1
Deferred income taxes	2,067.4	2,025.6
Shareholders' equity (deficit)
Preferred stock, no par value; authorized—165.0 million shares; issued—none	0.0	0.0
Common stock, $.01 par value; authorized—3.5 billion shares; issued—1,660.6 million shares	16.6	16.6
Additional paid-in capital	8,046.0	7,903.6
Retained earnings	55,739.0	53,908.1
Accumulated other comprehensive income (loss)	(2,571.2)	(2,586.8)
Common stock in treasury, at cost; 913.8 and 915.2 million shares	(67,038.4)	(67,066.4)
Total shareholders' equity (deficit)	(5,808.0)	(7,824.9)
Total liabilities and shareholders' equity (deficit)	$ 51,893.1	$ 52,626.8

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Condensed Consolidated Balance Sheet (Parenthetical) - $ / shares	Jun. 30, 2021	Dec. 31, 2020
Preferred stock, par value	$ 0	$ 0
Preferred stock, authorized	165,000,000.0	165,000,000.0
Preferred stock, issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, authorized	3,500,000,000.0	3,500,000,000.0
Common stock, issued	1,660,600,000	1,660,600,000
Common stock in treasury, shares	913,800,000	915,200,000

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Condensed Consolidated Statement of Income - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Revenues
Sales by Company-operated restaurants	$ 2,488.7	$ 1,593.7	$ 4,650.2	$ 3,619.5
Revenues from franchised restaurants	3,306.2	2,088.0	6,183.6	4,696.0
Other Revenues	93.0	79.8	178.7	160.4
Total revenues	5,887.9	3,761.5	11,012.5	8,475.9
Operating costs and expenses
Company-operated restaurant expenses	2,021.0	1,448.4	3,838.6	3,201.2
Franchised restaurants-occupancy expenses	579.1	524.5	1,150.6	1,078.7
Other Restaurant Expenses	68.3	63.3	135.5	128.8
Depreciation and Amortization	83.1	71.0	159.1	144.5
Other Selling, General and Administrative Expense	572.4	576.0	1,062.8	1,092.3
Other operating (income) expense, net	(127.1)	117.2	(306.5)	175.7
Total operating costs and expenses	3,196.8	2,800.4	6,040.1	5,821.2
Operating income	2,691.1	961.1	4,972.4	2,654.7
Interest expense	296.5	319.1	596.5	599.1
Nonoperating (income) expense, net	18.6	(6.7)	47.2	(38.0)
Income before provision for income taxes	2,376.0	648.7	4,328.7	2,093.6
Provision for income taxes	156.7	164.9	572.2	502.9
Net income	$ 2,219.3	$ 483.8	$ 3,756.5	$ 1,590.7
Earnings per common share-basic	$ 2.97	$ 0.65	$ 5.03	$ 2.14
Earnings per common share-diluted	2.95	0.65	5.00	2.12
Dividends declared per common share	$ 1.29	$ 1.25	$ 2.58	$ 2.50
Weighted average shares outstanding-basic	746.6	743.8	746.2	744.3
Weighted average shares outstanding-diluted	752.1	748.6	751.6	749.6

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Condensed Consolidated Statement of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Document Fiscal Year Focus			2021
Net income	$ 2,219.3	$ 483.8	$ 3,756.5	$ 1,590.7
Foreign currency translation adjustments:
Gain (loss) recognized in accumulated other comprehensive income (AOCI), including net investment hedges	47.8	207.1	(39.9)	(259.1)
Reclassification of (gain) loss to net income	9.7	0.0	20.4	0.0
Foreign currency translation adjustments-net of tax benefit (expense) of $22.7, $66.1, ($67.6) and ($49.2)	57.5	207.1	(19.5)	(259.1)
Cash flow hedges:
Gain (loss) recognized in AOCI	(1.2)	(17.6)	21.9	(57.2)
Reclassification of (gain) loss to net income	13.4	(1.7)	28.4	(10.8)
Cash flow hedges-net of tax benefit (expense) of ($3.7), $5.8, ($14.9) and $20.5	12.2	(19.3)	50.3	(68.0)
Defined benefit pension plans:
Gain (loss) recognized in AOCI	0.1	(0.6)	0.8	(2.5)
Reclassification of (gain) loss to net income	(5.1)	2.9	(16.0)	6.0
Defined benefit pension plans-net of tax benefit (expense) of $0.1, $0.1, $0.1 and $0.5	(5.0)	2.3	(15.2)	3.5
Total other comprehensive income (loss), net of tax	64.7	190.1	15.6	(323.6)
Comprehensive income (loss)	$ 2,284.0	$ 673.9	$ 3,772.1	$ 1,267.1

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Condensed Consolidated Statement of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Other comprehensive income (loss), foreign currency translation adjustment, tax	$ 22.7	$ 66.1	$ (67.6)	$ (49.2)
Other comprehensive income (loss), derivatives qualifying as hedges, tax	(3.7)	5.8	(14.9)	20.5
Other comprehensive income (loss), pension and other postretirement benefit plans, tax	$ 0.1	$ 0.1	$ 0.1	$ 0.5

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Condensed Consolidated Statement of Cash Flows - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Operating activities
Net income	$ 2,219.3	$ 483.8	$ 3,756.5	$ 1,590.7
Charges and credits:
Depreciation and amortization	463.4	425.7	917.3	847.0
Deferred income taxes	(368.9)	(42.1)	(370.4)	234.3
Share-based compensation	36.5	30.8	63.8	56.7
Other	(71.2)	119.2	(201.2)	31.3
Changes in working capital items	(545.9)	(1,230.5)	(308.8)	(1,427.1)
Cash provided by (used for) operations	1,733.2	(213.1)	3,857.2	1,332.9
Investing activities
Capital expenditures	(482.6)	(305.0)	(851.3)	(787.5)
Purchases of restaurant businesses	(49.4)	(23.7)	(88.1)	(43.3)
Sales of restaurant businesses	52.2	1.8	81.8	27.5
Sales of property	23.8	1.8	56.6	17.6
Other	42.5	(71.5)	142.9	(129.3)
Cash used for investing activities	(413.5)	(396.6)	(658.1)	(915.0)
Financing activities
Net short-term borrowings	1.4	(4.1)	7.9	107.7
Long-term financing issuances	0.0	0.8	0.0	5,540.2
Long-term financing repayments	(401.2)	(699.9)	(1,739.0)	(962.6)
Treasury stock purchases	(3.0)	(2.3)	(24.5)	(904.9)
Common stock dividends	(963.3)	(929.7)	(1,925.6)	(1,860.4)
Proceeds from stock option exercises	72.9	57.7	132.0	157.0
Other	(13.1)	(0.4)	(21.0)	(121.9)
Cash provided by (used for) financing activities	(1,306.3)	(1,577.9)	(3,570.2)	1,955.1
Effect of exchange rates on cash and cash equivalents	16.3	63.5	(28.6)	(15.8)
Cash and equivalents increase (decrease)	29.7	(2,124.1)	(399.7)	2,357.2
Cash and equivalents at beginning of period	3,019.7	5,379.8	3,449.1	898.5
Cash and equivalents at end of period	$ 3,049.4	$ 3,255.7	$ 3,049.4	$ 3,255.7

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Condensed Consolidated Statement of Shareholders' Equity - USD ($) shares in Millions, $ in Millions	Total	Common stock issued	Additional paid-in capital	Retained earnings	Pensions	Cash Flow Hedges	Foreign currency translation	Common stock in treasury
Beginning Balance (in shares) at Dec. 31, 2019		1,660.6						(914.3)
Beginning Balance at Dec. 31, 2019	$ (8,210.3)	$ 16.6	$ 7,653.9	$ 52,930.5	$ (243.7)	$ 12.0	$ (2,251.0)	$ (66,328.6)
Net income	1,590.7			1,590.7
Other comprehensive income (loss), net of tax	(323.6)				3.5	(68.0)	(259.1)
Comprehensive income	1,267.1
Common stock cash dividends	(1,860.4)			(1,860.4)
Treasury stock purchases (in shares)								(4.3)
Treasury stock purchases	(871.2)							$ (871.2)
Share-based compensation	56.7		56.7
Stock option exercises and other (in shares)								2.1
Stock option exercises and other	155.0		69.4					$ 85.6
Ending Balance (in shares) at Jun. 30, 2020		1,660.6						(916.5)
Ending Balance at Jun. 30, 2020	(9,463.1)	$ 16.6	7,780.0	52,660.8	(240.2)	(56.0)	(2,510.1)	$ (67,114.2)
Beginning Balance (in shares) at Mar. 31, 2020		1,660.6						(917.1)
Beginning Balance at Mar. 31, 2020	(9,293.4)	$ 16.6	7,713.5	53,106.7	(242.5)	(36.7)	(2,717.2)	$ (67,133.8)
Net income	483.8			483.8
Other comprehensive income (loss), net of tax	190.1				2.3	(19.3)	207.1
Comprehensive income	673.9
Common stock cash dividends	(929.7)			(929.7)
Treasury stock purchases (in shares)								(0.1)
Treasury stock purchases	(2.3)							$ (2.3)
Share-based compensation	30.8		30.8
Stock option exercises and other (in shares)								0.7
Stock option exercises and other	57.6		35.7					$ 21.9
Ending Balance (in shares) at Jun. 30, 2020		1,660.6						(916.5)
Ending Balance at Jun. 30, 2020	(9,463.1)	$ 16.6	7,780.0	52,660.8	(240.2)	(56.0)	(2,510.1)	$ (67,114.2)
Beginning Balance (in shares) at Dec. 31, 2020		1,660.6						(915.2)
Beginning Balance at Dec. 31, 2020	(7,824.9)	$ 16.6	7,903.6	53,908.1	(287.6)	(111.3)	(2,187.9)	$ (67,066.4)
Net income	3,756.5			3,756.5
Other comprehensive income (loss), net of tax	15.6				(15.2)	50.3	(19.5)
Comprehensive income	3,772.1
Common stock cash dividends	(1,925.6)			(1,925.6)
Treasury stock purchases (in shares)								(0.1)
Treasury stock purchases	(24.5)							$ (24.5)
Share-based compensation	63.8		63.8
Stock option exercises and other (in shares)								1.5
Stock option exercises and other	131.1		78.6					$ 52.5
Ending Balance (in shares) at Jun. 30, 2021		1,660.6						(913.8)
Ending Balance at Jun. 30, 2021	(5,808.0)	$ 16.6	8,046.0	55,739.0	(302.8)	(61.0)	(2,207.4)	$ (67,038.4)
Beginning Balance (in shares) at Mar. 31, 2021		1,660.6						(914.5)
Beginning Balance at Mar. 31, 2021	(7,235.5)	$ 16.6	7,959.1	54,483.0	(297.8)	(73.2)	(2,264.9)	$ (67,058.3)
Net income	2,219.3			2,219.3
Other comprehensive income (loss), net of tax	64.7				(5.0)	12.2	57.5
Comprehensive income	2,284.0
Common stock cash dividends	(963.3)			(963.3)
Treasury stock purchases (in shares)								0.0
Treasury stock purchases	(3.0)							$ (3.0)
Share-based compensation	36.5		36.5
Stock option exercises and other (in shares)								0.7
Stock option exercises and other	73.3		50.4					$ 22.9
Ending Balance (in shares) at Jun. 30, 2021		1,660.6						(913.8)
Ending Balance at Jun. 30, 2021	$ (5,808.0)	$ 16.6	$ 8,046.0	$ 55,739.0	$ (302.8)	$ (61.0)	$ (2,207.4)	$ (67,038.4)

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Condensed Consolidated Statement of Shareholders' Equity Consolidated Statement of Shareholders Equity (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Statement of Stockholders' Equity [Abstract]
Dividends declared per common share	$ 1.29	$ 1.25	$ 2.58	$ 2.50

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Basis of Presentation

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

McDonald’s Corporation, the registrant, together with its subsidiaries, is referred to herein as the "Company." The Company, its franchisees and suppliers, are referred to herein as the "System."

Basis of Presentation

The accompanying condensed consolidated financial statements should be read in conjunction with the Consolidated Financial Statements contained in the Company’s December 31, 2020 Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation have been included. The results for the quarter and six months ended June 30, 2021 do not necessarily indicate the results that may be expected for the full year.

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Restaurant Information

6 Months Ended

Jun. 30, 2021

Disclosure Restaurant Information By Ownership Type [Abstract]

Restaurant Information

Restaurant Information

The following table presents restaurant information by ownership type:

Restaurants at June 30,	2021	2020
Conventional franchised	21,519	21,822
Developmental licensed	7,753	7,685
Foreign affiliated	7,445	6,864
Total Franchised	36,717	36,371
Company-operated	2,679	2,649
Total Systemwide restaurants	39,396	39,020

The results of operations of restaurant businesses purchased and sold in transactions with franchisees were not material either individually or in the aggregate to the condensed consolidated financial statements for the periods prior to purchase and sale.

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Per Common Share Information	6 Months Ended
	Jun. 30, 2021
Earnings Per Share [Abstract]
Earnings Per Share [Text Block]	Diluted earnings per common share is calculated using net income divided by diluted weighted-average shares. Diluted weighted-average shares include weighted-average shares outstanding plus the dilutive effect of share-based compensation, calculated using the treasury stock method, of 5.5 million shares and 4.8 million shares for the quarters 2021 and 2020, respectively, and 5.4 million shares and 5.3 million shares for the six months 2021 and 2020, respectively. Share-based compensation awards that would have been antidilutive, and therefore were not included in the calculation of diluted weighted-average shares, totaled 3.0 million shares and 2.8 million shares for the quarters 2021 and 2020, respectively, and 3.0 million shares and 2.8 million shares for the six months 2021 and 2020, respectively.

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Income Taxes

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Income Tax Disclosure

Income Taxes

The effective income tax rate was 6.6% and 25.4% for the quarters ended 2021 and 2020, respectively, and 13.2% and 24.0% for the six months ended 2021 and 2020, respectively. The tax rate for the quarter and six months ended 2021 included a benefit of $364 million related to the remeasurement of deferred taxes as a result of a change in the U.K. statutory income tax rate.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value. Fair value disclosures are reflected in a three-level hierarchy, maximizing the use of observable inputs and minimizing the use of unobservable inputs. The Company did not have any significant changes to the valuation techniques used to measure fair value as described in the Company's December 31, 2020 Annual Report on Form 10-K.

At June 30, 2021, the fair value of the Company’s debt obligations was estimated at $40.3 billion, compared to a carrying amount of $35.4 billion. The fair value was based upon quoted market prices, Level 2 within the valuation hierarchy. The carrying amounts of cash and equivalents and notes receivable approximate fair value.

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Financial Instruments and Hedging Activities

6 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial Instruments and Hedging Activities

Financial Instruments and Hedging Activities

The Company is exposed to global market risks, including the effect of changes in interest rates and foreign currency fluctuations. The Company uses foreign currency denominated debt and derivative instruments to mitigate the impact of these changes. The Company does not hold or issue derivatives for trading purposes.

The following table presents the fair values of derivative instruments included on the Condensed Consolidated Balance Sheet:

	Derivative Assets					Derivative Liabilities
In millions	Balance Sheet Classification	June 30, 2021		December 31, 2020		Balance Sheet Classification	June 30, 2021		December 31, 2020
Derivatives designated as hedging instruments
Foreign currency	Prepaid expenses and other current assets	$	14.8			Accrued payroll and other liabilities	$	(24.4)	$	(64.5)
Interest rate	Prepaid expenses and other current assets	4.0				Accrued payroll and other liabilities
Foreign currency	Miscellaneous other assets	24.7		$	5.6	Other long-term liabilities	(0.3)		(15.0)
Interest rate	Miscellaneous other assets	21.7		35.8		Other long-term liabilities
Total derivatives designated as hedging instruments		$	65.2	$	41.4		$	(24.7)	$	(79.5)
Derivatives not designated as hedging instruments
Equity	Prepaid expenses and other current assets	$	202.1	$	185.6	Accrued payroll and other liabilities	$	—	$	(8.6)
Foreign currency	Prepaid expenses and other current assets					Accrued payroll and other liabilities	(4.9)		(9.4)
Equity	Miscellaneous other assets
Total derivatives not designated as hedging instruments		$	202.1	$	185.6		$	(4.9)	$	(18.0)
Total derivatives		$	267.3	$	227.0		$	(29.6)	$	(97.5)

    The following table presents the pre-tax amounts from derivative instruments affecting income and AOCI for the six months ended June 30, 2021 and 2020, respectively:

	Location of Gain or Loss Recognized in Income on Derivative	Gain (Loss) Recognized in AOCI				Gain (Loss) Reclassified into Income from AOCI				Gain (Loss) Recognized in Income on Derivative
In millions		2021		2020		2021		2020		2021		2020
Foreign currency	Nonoperating income/expense	$	28.4	$	16.4	$	(33.7)	$	16.4
Interest rate	Interest expense			(90.8)		(3.1)		(2.3)
Cash flow hedges		$	28.4	$	(74.4)	$	(36.8)	$	14.1
Foreign currency denominated debt	Nonoperating income/expense	$	274.0	$	91.3	$	32.4
Foreign currency derivatives	Nonoperating income/expense	26.5		15.0
Foreign currency derivatives(1)	Interest expense									$	7.3	$	7.3
Net investment hedges		$	300.5	$	106.3	$	32.4			$	7.3	$	7.3
Foreign currency	Nonoperating income/expense									$	4.5	$	(10.9)
Equity	Selling, general & administrative expenses									43.7		(23.6)
Equity	Other operating income/expense, net									(16.3)
Undesignated derivatives										$	31.9	$	(34.5)
(1)The amount of gain (loss) recognized in income related to components excluded from effectiveness testing.

Fair Value Hedges

The Company enters into fair value hedges to reduce the exposure to changes in fair values of certain liabilities. The Company enters into fair value hedges that convert a portion of its fixed rate debt into floating rate debt by use of interest rate swaps. At June 30, 2021, the carrying amount of fixed-rate debt that was effectively converted was $1.5 billion, which included an increase of $25.7 million of cumulative hedging adjustments. For the six months ended June 30, 2021, the Company recognized a $10.1 million loss on the fair value of interest rate swaps, and a corresponding gain on the fair value of the related hedged debt instrument to interest expense.

Cash Flow Hedges

The Company enters into cash flow hedges to reduce the exposure to variability in certain expected future cash flows. To protect against the reduction in value of forecasted foreign currency cash flows (such as royalties denominated in foreign currencies), the Company uses foreign currency forwards to hedge a portion of anticipated exposures. The hedges cover the next 18 months for certain exposures and are denominated in various currencies.

As of June 30, 2021, the Company had derivatives outstanding with an equivalent notional amount of $1.4 billion that hedged a portion of forecasted foreign currency denominated cash flows.

Based on market conditions at June 30, 2021, the $61.0 million in cumulative cash flow hedging losses, after tax, is not expected to have a significant effect on earnings over the next 12 months.

Net Investment Hedges

The Company primarily uses foreign currency denominated debt (third-party and intercompany) to hedge its investments in certain foreign subsidiaries and affiliates. Realized and unrealized translation adjustments from these hedges are included in shareholders' equity in the foreign currency translation component of Other comprehensive income ("OCI") and offset translation adjustments on the underlying net assets of foreign subsidiaries and affiliates, which also are recorded in OCI. As of June 30, 2021, $11.6 billion of the Company's third-party foreign currency denominated debt and $1.0 billion of the Company's intercompany foreign currency denominated debt was designated to hedge investments in certain foreign subsidiaries and affiliates.

Undesignated Derivatives

The Company enters into certain derivatives that are not designated for hedge accounting, therefore the changes in the fair value of these derivatives are recognized immediately in earnings together with the gain or loss from the hedged balance sheet position. As an example, the Company enters into equity derivative contracts, including total return swaps, to hedge market-driven changes in certain of its supplemental benefit plan liabilities. Changes in the fair value of these derivatives are recorded in Selling, general & administrative expenses together with the changes in the supplemental benefit plan liabilities. The Company may also use certain derivatives to mitigate the share price risk related to its sale of stock in McDonald’s Japan.  The changes in the fair value of the undesignated derivatives used for the most recent sale transaction were recognized immediately in earnings in Other Operating (income) expense, net. In addition, the Company uses foreign currency forwards to mitigate the change in fair value of certain foreign currency denominated assets and liabilities. The changes in the fair value of these derivatives are recognized in Nonoperating (income) expense, net, along with the currency gain or loss from the hedged balance sheet position.

Credit Risk

The Company is exposed to credit-related losses in the event of non-performance by its derivative counterparties. The Company did not have significant exposure to any individual counterparty at June 30, 2021 and has master agreements that contain netting arrangements. For financial reporting purposes, the Company presents gross derivative balances in the financial statements and supplementary data, including for counterparties subject to netting arrangements. Some of these agreements also require each party to post collateral if credit ratings fall below, or aggregate exposures exceed, certain contractual limits. At June 30, 2021, the Company was required to post an immaterial amount of collateral due to the negative fair value of certain derivative positions. The Company's counterparties were not required to post collateral on any derivative position, other than on certain hedges of the Company’s supplemental benefit plan liabilities where the counterparties were required to post collateral on their liability positions.

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Segment Information

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company operates under an organizational structure with the following global business segments reflecting how management reviews and evaluates operating performance:

•U.S. - the Company's largest market. The segment is 95% franchised as of June 30, 2021.

•International Operated Markets - comprised of markets or countries in which the Company operates and franchises restaurants, including Australia, Canada, France, Germany, Italy, the Netherlands, Russia, Spain and the U.K. The segment is 84% franchised as of June 30, 2021.

•International Developmental Licensed Markets & Corporate - comprised of primarily developmental licensee and affiliate markets in the McDonald’s system. Corporate activities are also reported in this segment. The segment is 98% franchised as of June 30, 2021.

The following table presents the Company’s revenues and operating income by segment:

	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Revenues
U.S.	$	2,278.8	$	1,758.6	$	4,354.3	$	3,629.6
International Operated Markets	3,078.7		1,612.5		5,634.9		4,016.8
International Developmental Licensed Markets & Corporate	530.4		390.4		1,023.3		829.5
Total revenues	$	5,887.9	$	3,761.5	$	11,012.5	$	8,475.9
Operating Income
U.S.	$	1,267.5	$	735.2	$	2,393.0	$	1,627.6
International Operated Markets	1,272.0		234.8		2,225.8		1,113.9
International Developmental Licensed Markets & Corporate *	151.6		(8.9)		353.6		(86.8)
Total operating income	$	2,691.1	$	961.1	$	4,972.4	$	2,654.7

*    Results included $98 million and $233 million for the quarter and six months, respectively, of net strategic gains primarily related to the sale of McDonald's Japan stock, which reduced the Company's total ownership by 3% for the quarter and 6% for the six months. As of June 30, 2021, the Company owned approximately 38% of McDonald's Japan. The proceeds were recorded within the other investing activities section of the Condensed Consolidated Statement of Cash Flows.

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Subsequent Events

6 Months Ended

Jun. 30, 2021

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued and filed with the Securities and Exchange Commission. There were no subsequent events that required recognition or disclosure.

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Recent Accounting Pronouncements Recent Accounting Pronouncements (Policies)

6 Months Ended

Jun. 30, 2021

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Accounting Standards Update and Change in Accounting Principle [Text Block]

Recently Adopted Accounting Pronouncements

Income Taxes

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”), which simplifies the accounting for income taxes. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, including applicable interim periods. The Company adopted the new standard effective January 1, 2021. The adoption of the standard did not have a material impact on the Company's condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

Reference Rate Reform

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" (“ASU 2020-04”). The pronouncement provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate and other interbank offered rates to alternative reference rates. The guidance was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The adoption of ASU 2020-04 will not have a material impact on the Company's condensed consolidated financial statements.

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Restaurant Information (Tables)

6 Months Ended

Jun. 30, 2021

Disclosure Restaurant Information By Ownership Type [Abstract]

Restaurant Information by Ownership Type

The following table presents restaurant information by ownership type:

Restaurants at June 30,	2021	2020
Conventional franchised	21,519	21,822
Developmental licensed	7,753	7,685
Foreign affiliated	7,445	6,864
Total Franchised	36,717	36,371
Company-operated	2,679	2,649
Total Systemwide restaurants	39,396	39,020

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Financial Instruments and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Values of Derivative Instruments Included on Consolidated Balance Sheet

The following table presents the fair values of derivative instruments included on the Condensed Consolidated Balance Sheet:

	Derivative Assets					Derivative Liabilities
In millions	Balance Sheet Classification	June 30, 2021		December 31, 2020		Balance Sheet Classification	June 30, 2021		December 31, 2020
Derivatives designated as hedging instruments
Foreign currency	Prepaid expenses and other current assets	$	14.8			Accrued payroll and other liabilities	$	(24.4)	$	(64.5)
Interest rate	Prepaid expenses and other current assets	4.0				Accrued payroll and other liabilities
Foreign currency	Miscellaneous other assets	24.7		$	5.6	Other long-term liabilities	(0.3)		(15.0)
Interest rate	Miscellaneous other assets	21.7		35.8		Other long-term liabilities
Total derivatives designated as hedging instruments		$	65.2	$	41.4		$	(24.7)	$	(79.5)
Derivatives not designated as hedging instruments
Equity	Prepaid expenses and other current assets	$	202.1	$	185.6	Accrued payroll and other liabilities	$	—	$	(8.6)
Foreign currency	Prepaid expenses and other current assets					Accrued payroll and other liabilities	(4.9)		(9.4)
Equity	Miscellaneous other assets
Total derivatives not designated as hedging instruments		$	202.1	$	185.6		$	(4.9)	$	(18.0)
Total derivatives		$	267.3	$	227.0		$	(29.6)	$	(97.5)

Derivatives Pretax Amounts Affecting Income and Other Comprehensive Income

The following table presents the pre-tax amounts from derivative instruments affecting income and AOCI for the six months ended June 30, 2021 and 2020, respectively:

	Location of Gain or Loss Recognized in Income on Derivative	Gain (Loss) Recognized in AOCI				Gain (Loss) Reclassified into Income from AOCI				Gain (Loss) Recognized in Income on Derivative
In millions		2021		2020		2021		2020		2021		2020
Foreign currency	Nonoperating income/expense	$	28.4	$	16.4	$	(33.7)	$	16.4
Interest rate	Interest expense			(90.8)		(3.1)		(2.3)
Cash flow hedges		$	28.4	$	(74.4)	$	(36.8)	$	14.1
Foreign currency denominated debt	Nonoperating income/expense	$	274.0	$	91.3	$	32.4
Foreign currency derivatives	Nonoperating income/expense	26.5		15.0
Foreign currency derivatives(1)	Interest expense									$	7.3	$	7.3
Net investment hedges		$	300.5	$	106.3	$	32.4			$	7.3	$	7.3
Foreign currency	Nonoperating income/expense									$	4.5	$	(10.9)
Equity	Selling, general & administrative expenses									43.7		(23.6)
Equity	Other operating income/expense, net									(16.3)
Undesignated derivatives										$	31.9	$	(34.5)
(1)The amount of gain (loss) recognized in income related to components excluded from effectiveness testing.

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Franchise Arrangements (Tables)

6 Months Ended

Jun. 30, 2021

Disclosure Franchise Arrangements Additional Information [Abstract]

Revenues from Franchised Restaurants

Revenues from franchised restaurants consisted of:

	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Rents	$	2,125.7	$	1,314.9	$	3,951.8	$	2,983.1
Royalties	1,167.8		762.0		2,206.5		1,690.8
Initial fees	12.7		11.1		25.3		22.1
Revenues from franchised restaurants	$	3,306.2	$	2,088.0	$	6,183.6	$	4,696.0

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Revenues and Operating Income by Geographic Segment

The following table presents the Company’s revenues and operating income by segment:

	Quarters Ended				Six Months Ended
	June 30,				June 30,
In millions	2021		2020		2021		2020
Revenues
U.S.	$	2,278.8	$	1,758.6	$	4,354.3	$	3,629.6
International Operated Markets	3,078.7		1,612.5		5,634.9		4,016.8
International Developmental Licensed Markets & Corporate	530.4		390.4		1,023.3		829.5
Total revenues	$	5,887.9	$	3,761.5	$	11,012.5	$	8,475.9
Operating Income
U.S.	$	1,267.5	$	735.2	$	2,393.0	$	1,627.6
International Operated Markets	1,272.0		234.8		2,225.8		1,113.9
International Developmental Licensed Markets & Corporate *	151.6		(8.9)		353.6		(86.8)
Total operating income	$	2,691.1	$	961.1	$	4,972.4	$	2,654.7

*    Results included $98 million and $233 million for the quarter and six months, respectively, of net strategic gains primarily related to the sale of McDonald's Japan stock, which reduced the Company's total ownership by 3% for the quarter and 6% for the six months. As of June 30, 2021, the Company owned approximately 38% of McDonald's Japan. The proceeds were recorded within the other investing activities section of the Condensed Consolidated Statement of Cash Flows.

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Restaurant Information by Ownership Type (Details) - Restaurant	Jun. 30, 2021	Jun. 30, 2020
Segment Reporting Information [Line Items]
Number of Restaurants	39,396	39,020
Franchised
Segment Reporting Information [Line Items]
Number of Restaurants	36,717	36,371
Franchised | Conventional franchised
Segment Reporting Information [Line Items]
Number of Restaurants	21,519	21,822
Franchised | Developmental licensed
Segment Reporting Information [Line Items]
Number of Restaurants	7,753	7,685
Franchised | Affiliated
Segment Reporting Information [Line Items]
Number of Restaurants	7,445	6,864
Company-operated
Segment Reporting Information [Line Items]
Number of Restaurants	2,679	2,649

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Per Common Share Information (Additional Information) (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Earnings Per Share [Abstract]
Dilutive effect of share-based compensation	5.5	4.8	5.4	5.3
Stock options that were not included in diluted weighted-average shares	3.0	2.8	3.0	2.8

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Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Income Tax Disclosure [Abstract]
Effective Income Tax Rate Reconciliation, Percent	6.60%	25.40%	13.20%	24.00%
Deferred Tax Assets, Tax Deferred Expense	$ 364		$ 364

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Fair Value Measurements (Additional Information) (Details) $ in Billions	Jun. 30, 2021 USD ($)
Fair Value Measurements [Line Items]
Debt obligations, carrying amount	$ 35.4
Level 2
Fair Value Measurements [Line Items]
Debt obligations, fair value	$ 40.3

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Financial Instruments and Hedging Activities (Fair Values of Derivative Instruments Included on Consolidated Balance Sheet) (Details) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	$ 267.3	$ 227.0
Liability Derivatives Fair Value	29.6	97.5
Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	65.2	41.4
Liability Derivatives Fair Value	24.7	79.5
Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	202.1	185.6
Liability Derivatives Fair Value	4.9	18.0
Interest Rate Contract [Member] | Accrued Expenses And Other Current Liabilities [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Liability Derivatives Fair Value
Interest Rate Contract [Member] | Prepaid Expenses and Other Current Assets [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	4.0
Interest Rate Contract [Member] | Other Liabilities [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Liability Derivatives Fair Value
Interest Rate Contract [Member] | Other Assets [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	21.7	35.8
Equity [Member] | Accrued Expenses And Other Current Liabilities [Member] | Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Liability Derivatives Fair Value	0.0	8.6
Equity [Member] | Prepaid Expenses and Other Current Assets [Member] | Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	202.1	185.6
Equity [Member] | Other Assets [Member] | Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value
Foreign Exchange [Member] | Accrued Expenses And Other Current Liabilities [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Liability Derivatives Fair Value	24.4	64.5
Foreign Exchange [Member] | Accrued Expenses And Other Current Liabilities [Member] | Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Liability Derivatives Fair Value	4.9	9.4
Foreign Exchange [Member] | Prepaid Expenses and Other Current Assets [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	14.8
Foreign Exchange [Member] | Prepaid Expenses and Other Current Assets [Member] | Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value
Foreign Exchange [Member] | Other Liabilities [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Liability Derivatives Fair Value	0.3	15.0
Foreign Exchange [Member] | Other Assets [Member] | Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	$ 24.7	$ 5.6

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(Derivatives Pretax Amounts Affecting Income and Other Comprehensive Income) (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Derivatives in Cash Flow Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Reclassified into Income from Accumulated OCI (Effective Portion)	$ (36.8)	$ 14.1
Gain (Loss) Recognized in Accumulated OCI (Effective Portion)	28.4	(74.4)
Net Investment Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Reclassified into Income from Accumulated OCI (Effective Portion)	32.4
Gain (Loss) Recognized in Accumulated OCI (Effective Portion)	300.5	106.3
Gain (Loss) Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing and Ineffective Portion)	7.3	7.3
Derivatives Not Designated as Hedging Instruments
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments, gain (loss) recognized in income, net	31.9	(34.5)
Foreign Exchange [Member] | Derivatives in Cash Flow Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Reclassified into Income from Accumulated OCI (Effective Portion)	(33.7)	16.4
Gain (Loss) Recognized in Accumulated OCI (Effective Portion)	28.4	16.4
Foreign Exchange [Member] | Derivatives Not Designated as Hedging Instruments
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments, gain (loss) recognized in income, net	4.5	(10.9)
Foreign Exchange Forward [Member] | Net Investment Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Accumulated OCI (Effective Portion)	26.5	15.0
Cross Currency Interest Rate Contract [Member] | Net Investment Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing and Ineffective Portion)	7.3	7.3
Interest Rate Contract [Member] | Derivatives in Cash Flow Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Reclassified into Income from Accumulated OCI (Effective Portion)	(3.1)	(2.3)
Gain (Loss) Recognized in Accumulated OCI (Effective Portion)		(90.8)
Other Foreign Currency Denominated Debt [Member] | Net Investment Hedging Relationships
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Reclassified into Income from Accumulated OCI (Effective Portion)	32.4
Gain (Loss) Recognized in Accumulated OCI (Effective Portion)	274.0	91.3
Equity [Member] | Derivatives Not Designated as Hedging Instruments
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments, gain (loss) recognized in income, net	43.7	$ (23.6)
Equity Contract [Member] | Derivatives Not Designated as Hedging Instruments
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments, gain (loss) recognized in income, net	$ (16.3)

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(Financial Instruments and Hedging Activities - Additional Information) (Details) $ in Millions	6 Months Ended
	Jun. 30, 2021 USD ($)
Derivative Instruments and Hedging Activities Disclosure [Line Items]
Cumulative deferred hedging gain (loss), after tax, included in accumulated other comprehensive income	$ (61.0)
Interest Rate Swap
Derivative Instruments and Hedging Activities Disclosure [Line Items]
Derivative, Notional Amount	1,500.0
Intercompany Debt [Member]
Derivative Instruments and Hedging Activities Disclosure [Line Items]
Foreign currency denominated debt designated to hedge investments in certain foreign subsidiaries and affiliates	1,000.0
Debt [Member]
Derivative Instruments and Hedging Activities Disclosure [Line Items]
Foreign currency denominated debt designated to hedge investments in certain foreign subsidiaries and affiliates	11,600.0
Interest Rate Risk [Member] | Fair Value Hedging [Member]
Derivative Instruments and Hedging Activities Disclosure [Line Items]
Derivative instruments, gain (loss) recognized in income, net	(10.1)
Increase (Decrease) in Fair Value of Interest Rate Fair Value Hedging Instruments	25.7
Royalty Arrangement [Member]
Derivative Instruments and Hedging Activities Disclosure [Line Items]
Derivative, Notional Amount	$ 1,400.0
Period covered by hedge	18 months

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Revenues from Franchised Restaurants (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Franchisor Disclosure
Rents	$ 2,125.7	$ 1,314.9	$ 3,951.8	$ 2,983.1
Royalties	1,167.8	762.0	2,206.5	1,690.8
Initial Fees	12.7	11.1	25.3	22.1
Revenues from franchised restaurants	$ 3,306.2	$ 2,088.0	$ 6,183.6	$ 4,696.0

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Segment Information (Segment and Geographic Information) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Segment Reporting Information [Line Items]
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	38.00%		38.00%
Gain (Loss) on Disposition of Stock in Subsidiary or Equity Method Investee	$ 98.0		$ 233.0
Total revenues	5,887.9	$ 3,761.5	11,012.5	$ 8,475.9
Operating Income	2,691.1	961.1	4,972.4	2,654.7
United States
Segment Reporting Information [Line Items]
Total revenues	2,278.8	1,758.6	4,354.3	3,629.6
Operating Income	1,267.5	735.2	2,393.0	1,627.6
International Operated Markets
Segment Reporting Information [Line Items]
Total revenues	3,078.7	1,612.5	5,634.9	4,016.8
Operating Income	1,272.0	234.8	2,225.8	1,113.9
International Developmental Licensed Markets and Corporate
Segment Reporting Information [Line Items]
Total revenues	530.4	390.4	1,023.3	829.5
Operating Income	$ 151.6	$ (8.9)	$ 353.6	$ (86.8)

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Subsequent Events Subsequent Events (Details)	Jun. 30, 2021
Noncontrolling Interest [Line Items]
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	38.00%