By Deborah Mary Sophia
(Reuters) – McDonald’s is planning to open about 10,000 restaurants globally by 2027 and more than double revenue from its loyalty program, the company said on Wednesday, as it invests heavily to automate processes and speed up service at its stores.
The expansion plans it laid out would take its restaurant count to about 50,000 in over 100 countries and mark the fastest period of growth in the company’s history, McDonald’s said ahead of its investor day.
The company also said that it planned to increase the user base of its loyalty program to 250 million customers by 2027, putting it on track to deliver $45 billion in annual sales.
The program currently has 150 million active users, who generate over $20 billion in system-wide sales.
McDonald’s has doubled down on its marketing strategies over the past several years, including piloting its “Best Burger” initiative to improve the quality of its burgers.
The initiative – which the company scaled to 70 markets recently – will be deployed to nearly all markets by 2026, it said.
For 2024, McDonald’s expects nearly 2% growth in system-wide sales from new restaurants, on a constant currency basis, compared with the 1.5% growth it expects for 2023. Operating margins next year are estimated to be in the mid-to-high 40% range.
By using multiple store format options, including smaller outlets, “McDonald’s has the opportunity to drive market share gains in … areas where access may have been challenging,” Northcoast Research analyst Jim Sanderson said.
It also partnered with Alphabet’s Google Cloud to deploy artificial intelligence (AI) solutions to its restaurants worldwide. That would include automating processes to help deliver hotter, fresher food to customers faster.
McDonald’s shares were down marginally in early trading.
Although U.S. consumer spending has been pressured, McDonald’s has remained largely unaffected due to its affordable menu items and aggressive promotions. McDonald’s topped estimates for sales and profit in the quarter ended September.
(Reporting by Deborah Sophia in Bengaluru; Editing by Anil D’Silva)