McDonald's Slumps 6.5% After $8.5 Billion Franchisee Support Plan Unveiled

McDonald's shares fell sharply after the company unveiled an $8.5 billion franchisee support plan and warned that industry traffic could remain flat while inflation stays elevated.

The fast-food giant's stock dropped as much as 6.5% during the session to $234.03, its lowest level in nearly four years. The stock ended at $238.32, down 4.81%. Trading activity was unusually heavy, with more than 13.8 million shares changing hands, nearly three times the 20-day average.

The support plan includes approximately $5 billion through 2030 and a combination of rent relief and capital support to accelerate restaurant modernisation and technology upgrades as part of McDonald's NEXT strategy.

The company is committing substantial resources now while benefits from restaurant upgrades, technology, and operational improvements are expected to develop over several years. Investors are concerned about the timing of the investment.