McDonald’s bets $8.5 billion on a productivity makeover across more than 46,000 restaurants

Good morning.

Ian Borden, McDonald’s EVP and global CFO, is betting that the company’s next phase of profitable growth will come not just from opening more restaurants, but from making its existing network more productive.

McDonald’s unveiled its updated NEXT growth strategy on Wednesday at its investor day, committing about $8.5 billion in support for franchisees through 2036.

That includes roughly $5 billion through 2030, primarily through rent relief and capital support.

The company also expects to spend about $3 billion a year on baseline capital expenditures from 2027 through 2030, based on current foreign exchange rates, plus $1.5 billion to $2 billion in cumulative capital partnering support to accelerate the rollout.

The capital partnering support is part of the broader NEXT investment framework.

“It’s a value creation strategy, designed to generate attractive returns for franchisees and shareholders,” Borden said during his investor day presentation.

It aims to strengthen restaurant economics and create the capacity to reinvest for long-term growth.

Borden, who has been global CFO since 2022, has spent more than 30 years with McDonald’s, including extensive experience leading markets and global functions.

The strategy pairs continued expansion with productivity investments at existing restaurants.

Unit growth is expected to contribute nearly 2.5% to systemwide sales growth in 2027, moderating to about 2% by 2030—meaning a growing share of McDonald’s sales gains will come from existing restaurants becoming more productive, not just from opening new ones.

Technology is another part of the strategy.

McDonald’s plans to deploy ArchIQ, a generative AI-enabled operating system, at scale to help improve restaurant operations, including the drive-thru.

The company expects its Restaurant NEXT investments to generate about 250 basis points of gross restaurant-level efficiency gains, translating to roughly $100,000 in additional annual cash flow for the average U.S. restaurant.