McDonald’s Drive-Thru Ad Test Leaves Franchisees Off the Board

McDonald’s is testing third-party ads on drive-thru screens at 450 company-owned U.S. restaurants, a thin slice of a chain that is 95% franchised. On September 23, Global Chief Marketing Officer Morgan Flatley told investors the McDonald’s Media Network could become a $1 billion business across that system over time.

The ads start after the order, on boards independent operators did not put into the test. Those operators run almost every U.S. restaurant and will write the next checks for screens and kitchens. The company has not said how, or whether, they get a cut.

The Test Runs Only Where McDonald’s Holds the Keys

The pilot began in August 2026 at restaurants the corporation runs itself. It does not include franchisees. Flatley said the first live inventory is a market test, not a national buy, and she put no year on the billion-dollar figure.

McDonald’s walked investors through the idea the same morning it laid out McDonald’s NEXT, a growth and productivity plan built around menu, customers, restaurants, and people. The media network was a short passage in Flatley’s remarks. The written press release that morning did not mention it, and none of the 2030 financial targets in that release is an advertising number.

The Investor Day webcast is the cleanest record of what was actually said on stage.

THE MEDIA NETWORK CALENDAR

1. August 2026: Third-party ads go live on digital drive-thru boards at 450 company-owned U.S. restaurants.
2. September 23, 2026: Flatley pitches a billion-dollar McDonald’s Media Network at Investor Day in Chicago.
3. October 5, 2026: Make It Golden, a systemwide hospitality push, is due to begin on Founder’s Day.

U.S. comparable sales rose 0.8% in the second quarter of 2026, down from 2.5% in the same quarter a year earlier. A high-margin ad stream is one way to grow income without asking the drive-thru to sell more burgers.

Franchisees Own the Screens a Billion-Dollar Plan Needs

Ownership is the constraint that the 450-store headline hides. McDonald’s said in its June 30, 2026 filing that franchised restaurants were about 95% of the global system, and that the U.S. segment was 95% franchised as well. The filing counts 13,769 U.S. restaurants at June 30, so the pilot is about 3% of the domestic estate.

WHERE THE SCREENS ACTUALLY SIT

Any path to a billion dollars has to run through those independent owners. Flatley called the network a way to create new high-margin sources of value for McDonald’s and its franchisees, which implies shared proceeds. She did not describe a split, an opt-out, or whether the billion dollars is gross advertising sales or money the corporation would book.

Chief Financial Officer Ian Borden told investors the company wants the franchised mix to rise from about 95% to about 98% globally by the end of 2028. The pool of screens McDonald’s operates itself is scheduled to shrink, not grow. The test is happening on the part of the estate that is supposed to get smaller.

After You Order, the Board Becomes Inventory

The live unit is a drive-thru digital order board, and the ad is timed for after the customer has ordered. McDonald’s said the limited pilot is exploring post-purchase content that customers may find helpful, relevant, or interesting, while keeping the McDonald’s experience at the center of the visit. A board that waits until the burger is already sold does not fight the menu during the sale. It sells the minutes in the lane.

It is an opportunity to generate revenue for the system with little in the way of additional cost, no operational complexity, and no disruption to our customer experience.

Morgan Flatley, Global Chief Marketing Officer, Investor Day

On stage the company showed a Geico ad taking over part of a drive-thru menu. That was a mock-up of how the board could look. It is not a public confirmation that Geico is buying the test.

The wider pitch is every digital surface in the restaurant. Flatley listed an unmatched footprint from the app to kiosks, menu boards, and restaurants, alongside more than 70 million daily customers. The only placement confirmed in the pilot is the order board after checkout.

SURFACES IN THE PITCH

• Drive-thru boards: The live test, with third-party ads after the order is placed.
• In-store menu boards: Named as future inventory, not confirmed in the 450-store run.
• Self-order kiosks: Listed with the other screens as a place ads could run later.
• The app: Counted among the digital assets, with no public rate card.

That sequencing is why Flatley can claim no disruption. The customer has already chosen the food. The remaining product is attention in a parked car, which is why the wait itself is the inventory, and why a longer line would, on paper, be worth more to an advertiser than a short one.

How Big Is the McDonald’s Media Network Goal?

Flatley said McDonald’s is at the beginning of an aspiration to build the network into a billion-dollar business across the McDonald’s system over time. She gave no date, no rate card, no technology partner, and no measurement method. Commerce media, she said, is one of the fastest-growing areas in advertising and is expected to reach more than $100 billion in the U.S. alone by 2028. She did not name the forecast house behind that figure.

The reach argument sits on loyalty as much as on restaurants. Chairman and CEO Chris Kempczinski said McDonald’s serves more than 70 million customers a day and that nearly 220 million people regularly use the app and loyalty program. The Investor Day release puts that on the page as nearly 220 million 90-day active loyalty members across 70 loyalty markets.

Flatley said that base is up 45% over three years, and that if those members were a country it would be the seventh largest in the world. Active members visit 2.5 times as often as non-members. She also said that at any moment roughly 150 million people who signed up but have not visited in a few months are available to reengage. Kempczinski, answering an analyst on the U.S. business, said loyalty accounts for about 30% of sales. Borden, in a separate interview, said McDonald’s serves about 85% of the U.S. population at least once a year.

The transcript does not explicitly tie that data to ad targeting for the new network. It does say the more fans engage, the more the company learns about them as individuals. Sales started on the phone already represent about 40% of systemwide sales across the top five markets, so a large share of orders already pass through a screen McDonald’s controls.

Amazon and Walmart Already Sell This Kind of Attention

McDonald’s is copying a model retailers have already turned into a profit center: sell ads against people who showed up to buy something else. Amazon reported $68.6 billion in advertising services sales in 2025. Walmart said its U.S. advertising business grew 43% in its fiscal second quarter, and it put global advertising at nearly $6.4 billion for fiscal 2026, a different and smaller pile than Amazon’s.

THE AD BUSINESSES MCDONALD’S IS MEASURING AGAINST

A billion dollars would be small next to Amazon and still large for a restaurant company that has not sold this product before. The closer comparison is Walmart, because both own physical places where people stand and wait. Restaurant screens are not a new idea. What is new is a chain of this size selling its own order boards under its own name, with loyalty data sitting behind the glass.

An insurer on a burger board is also a harder sale to prove. Retail media grew on a closed loop: the same company that showed the ad can see whether the shopper bought the item. McDonald’s does not sell car insurance. A Geico-style spot can be counted as a play on a screen. It cannot be tied to a policy in McDonald’s own till.

$8.5 Billion to Modernize and a New Use for the Wait

The same Investor Day pledged about $8.5 billion in partnering support for franchisees through 2036, including about $5 billion through 2030, as rent relief and capital help. The point of that money is to modernize restaurants, put in new technology, and raise efficiency. Management’s target is about 250 basis points of gross restaurant-level efficiency, equal to roughly $100,000 of annual cash flow at an average U.S. restaurant, with about a four-year payback for franchisees after that help and five to six years for McDonald’s.

Supporting slides put the extra outlay for a traditional U.S. drive-thru at about $800,000 in added U.S. spending, and $650,000 to $700,000 in major international operated markets. Those dollars buy kitchens, tech bundles, and design. They also buy the digital boards that the media network wants to sell.

That is the quiet collision. NEXT is a plan to make restaurants easier to run and faster to leave. The media product is a plan to sell the time a car spends in the lane after the order. Nobody on stage said the company wants slower lines. Nobody had to. An impression sold against a waiting driver is worth more if the driver waits.

Customers already treat extra screens as another unskippable ad. The complaint is not subtle: you paid, then you watch. Burger chains have spent a decade replacing counter talk with kiosks and apps. Selling that quiet to a third party is a different use of the same glass.

A Franchised Mix Headed Toward 98 Percent

Company stores are the right place to test a new idea, and McDonald’s said tests and pilots are how it evaluates concepts before a wider rollout. That process does not answer the only question that matters for a $1 billion system product. Independent owners control the restaurants, the crews, and, in most towns, the boards. They are being asked to fund the next generation of those boards. They have not been shown a public price, a share, or a right to say no.

WHAT WE KNOW

• The live test: 450 company-owned U.S. restaurants, drive-thru boards, ads after the order, running since August 2026.
• The target: a billion-dollar network across the McDonald’s system over time, with no year attached.
• The estate: 46,028 restaurants at June 30, 2026, about 95% franchised, 13,769 of them in the U.S.

WHAT IS UNCONFIRMED

• The split: how ad money would be shared with franchisees, or whether an owner could opt out.
• The buyers: which brands are paying in the pilot; Geico appeared as a slide, not as a named contract.
• The surfaces: when, or whether, kiosks, dining-room boards, and the app join the drive-thru test.

Borden’s 98% franchised target by the end of 2028 makes that silence more expensive, not less. If the plan works, almost every board that could carry a third-party ad will sit in a restaurant McDonald’s does not operate. The 450-store test can prove that a Geico panel can play after a Big Mac order. It cannot prove that thousands of local owners will accept that panel as part of the rent.