Burger King has been making inroads into McDonald’s customer base, and now the fast-food giant is countering with a new strategy centered on two main pillars: frozen, hand-breaded chicken and smarter drive-through systems. During its investor day in Chicago, McDonald’s revealed a growth plan built around these ideas, along with a push to bring back 90s-style restaurants. The company is hoping these moves will draw customers back from rivals like Burger King.
The plan comes after a rough second quarter. McDonald’s posted 0.8% US same-store sales growth, while Burger King’s parent company, Restaurant Brands International (QSR), logged 8.5% growth. McDonald’s is now rolling out a $8.5 billion investment program through 2036 to support restaurant tech updates, with rent relief and capital. It aims to deliver roughly $5 billion of that investment by 2030.
Hand-Breaded Chicken, Piloted
A new menu item called “Make it Golden.” sits at the center of the offering, built around food, hospitality, and employee training. The true selling point, however, rests with the chicken.
McDonald’s is piloting hand-breaded chicken, a move that mirrors Burger King’s recent overhaul of its nugget recipe. The chicken comes frozen, marinated, dipped in batter, and hand-breaded. Jacques Mignault, McDonald’s Global Chief Restaurant Officer, told Yahoo Finance that the secret is to flip the chicken seven times.
Market share is the goal, and it carries a 1.5% target. Chicken and drinks are doing the heavy lifting, while crafted sodas sit alongside them as a key priority. The hand-breaded chicken pilot will keep growing in the United States, with more restaurants joining the program in early 2027.
The company’s new chicken has found a home in Asian markets, according to Mignault, who described it as “actually beating the competition from a taste and quality standpoint”. He also noted that the firm has begun experimenting with bone-in wings.
The Remodel Cost
One franchisee operator spoke to Yahoo Finance about the difficulty of carrying out another costly redesign, pointing to thin margins driven by rising ingredient, labor, and rent expenses. The plan is being promoted for adoption in stages.
Deploying the entire NEXT strategy will cost franchise operators an additional $800,000 per restaurant. Operators are expected to update the restaurants’ look and feel as part of a remodel cycle every 10 years, per McDonald’s.
“You start with the opportunity, which we think is really clear and compelling,” McDonald’s CFO Ian Borden told Yahoo Finance. “We think it’s going to provide a really strong return for our operators and for McDonald’s.”
The Stock Picture
It remains uncertain whether the scheme will hinge on McDonald’s stock. Year to date, shares have fallen 18%. By contrast, QSR has gained 4.6%, while the S&P 500 (^GSPC) has risen 13%.
McDonald’s stock fell 5% on Wednesday.
The distance between the company’s ambitions and its current performance is wide. McDonald’s is vast: they are spending billions on technology and remodeling, while franchisees are being asked to pay half a million dollars each. The promise made is a 1.5% market-share gain. The real test is whether consumers share the same enthusiasm for hand-breaded chicken flips and AI drive-throughs that executives do.
What McDonald’s Is Actually Doing
The plan includes several moving parts:
- A $8.5 billion investment through 2036 for restaurant tech updates, with rent relief and capital
- Roughly $5 billion delivered by 2030
- Hand-breaded chicken pilot expanding to more US locations in early 2027
- Franchisees updating restaurants every 10 years at a cost of $800,000 per restaurant
- A 1.5% market-share target, led by chicken and beverages
Borden’s confidence is easy to state. Whether it holds up against Burger King’s stronger quarter and QSR’s better stock performance is another matter.
A specific product move like the hand-breaded chicken has the potential to actually change minds at the drive-through. The remodel cost, however, is a heavy lift for franchisees already squeezed by inflation and rising rates. McDonald’s is asking operators to spend heavily on a plan that has not yet proven itself in the marketplace.
The firm’s wager rests upon a superior chicken menu alongside more intelligent technology drawing patrons back. The payoff hinges on three conditions: the chicken must indeed taste better, the renovations hold up, and the shares answer positively.
For now, McDonald’s has shown its cards. The public will decide what they mean.
Source material: “McDonald's bets on hand-breaded chicken, AI drive-throughs to fend off Burger King,” Yahoo Finance.
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