Arcos Dorados Holdings Inc. serves as the premier franchisee for McDonald's, holding exclusive rights to operate, own, and sub-franchise the fast-food chain's ...
Arcos Dorados Holdings Inc. is a consumer-cyclical quick-service restaurant (QSR) franchising and operating platform focused on the McDonald’s system. Through master franchise arrangements, the company serves as the premier independent franchisee that operates, owns, and sub-franchises McDonald’s restaurants across a wide footprint spanning 20 countries and territories in Latin America ...Arcos Dorados Holdings Inc. is a consumer-cyclical quick-service restaurant (QSR) franchising and operating platform focused on the McDonald’s system. Through master franchise arrangements, the company serves as the premier independent franchisee that operates, owns, and sub-franchises McDonald’s restaurants across a wide footprint spanning 20 countries and territories in Latin America and the Caribbean. Its operations include major markets such as Argentina, Brazil, Mexico, Chile, Colombia, Peru, and several Caribbean and island territories, enabling the company to supply local restaurant operations while adhering to McDonald’s brand standards.
From a business perspective, Arcos Dorados’ model is built around franchise economics and company-operated store performance. The company manages restaurant development and operations at scale, with the provided data indicating that as of the end of 2021 it managed or franchised 2,261 restaurant locations (other references indicate a larger count in subsequent years). This scale supports centralized capabilities (procurement, supply-chain relationships, restaurant support, and administrative functions) while leveraging McDonald’s established menu, marketing, and operating framework.
Key products and services are restaurant operations and related services tied to the McDonald’s brand: running day-to-day restaurant activities for company-operated locations and coordinating sub-franchise or franchise relationships where applicable. The company’s revenue and cash flows are therefore closely linked to consumer demand, store count, same-restaurant sales, labor and commodity costs (notably food and packaging), and investment cycles such as new restaurant openings and restaurant refreshes.
Cost structure typically includes major operating expenses such as labor, rent/occupancy costs (varying by country and store model), food and packaging inputs, utilities, and marketing contributions consistent with franchise requirements. Capital expenditure needs can arise from restaurant build-outs, refurbishments, and supply-chain or technology investments; for the latest snapshot included in the provided data, capex metrics and profitability ratios suggest an actively managed asset and store-investment program, though results can vary with operating conditions.
Financially, Arcos Dorados is valued in the public markets as an operating franchisee rather than a pure asset owner, meaning metrics such as margins and cash flow generation are influenced by both restaurant-level performance and the structure of franchise arrangements. The provided financial snapshot indicates metrics like positive return on equity and operating profitability, alongside leverage and liquidity measures that reflect the realities of running and expanding QSR restaurant networks.
In terms of key people and governance, the sources indicate that Woods Staton is the founder and controlling shareholder and serves as Executive Chairman of the Board. The CEO is identified as Marcelo Rabach. This leadership structure highlights founder influence alongside executive operational management.
Overall, Arcos Dorados’ strategic “wish list” for stakeholders would typically include sustaining store growth and optimizing same-store performance across diverse geographies, maintaining brand-aligned execution, and investing in restaurant modernization and supply-chain efficiency to protect margins through cyclical changes in consumer spending and input costs.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$4.7B
+4.7%
+7.4%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$212.1M
+42.6%
+24.5%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+12.3%
-6.5%
+9.7%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
+7.5%
+3.1%
+26.1%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
+4.5%
+36.2%
+16.0%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$15.0M
+124.7%
+401.8%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
+0.3%
+123.6%
+381.1%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
291.4%
-13.9%
-6.1%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
1.03x
+68.1%
+10.0%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Dan Schleiniger: Good morning, and thank you for joining Arcos Dorados' second quarter 2026 earnings webcast. With us today are Luis Raganato, our Chief Executive Officer, and Mariano Tannenbaum, our Chief Financial Officer. Today's webcast, which is being recorded, will consist of prepared remarks from our leadership team, which will be accompanied by a slide presentation that is also available in the investor section of our website, ir.arcosdorados.com. To better follow the presentation, please note that you can set your view to full screen on the webcast platform. Additionally, you can submit your questions at any time during the presentation using the Q&A function on the bottom of the screen. After we conclude our opening remarks, we will answer your questions. Today's call will contain forward-looking statements, and I refer you to the forward-looking statements section of our earnings release and recent filings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances. In addition to reporting financial results in accordance with generally accepted accounting principles, we report certain non-GAAP financial results. Investors are encouraged to review the reconciliation of these non-GAAP financial results as compared with GAAP results, which can be found in today's earnings press release and conference call presentation, as well as the unaudited financial statements filed today with the SEC on Form 6-K. I will now turn the call over to Luis.
Luis Raganato: Thank you, Dan, and good morning. Before getting into the second quarter results, I would like to start with a few words about Venezuela. The earthquake at the end of June impacted the entire country in one way or another, including Arcos Dorados. I am very proud of the local team's effort to support our people, suppliers, franchisees, and the communities they serve. Working with local authorities and medical professionals in the hardest-hit part of the country, they quickly converted one restaurant into a medical center and another into a shelter for people who lost their homes. While recovery efforts continue, we are beginning to see signs of progress. People are gradually returning to their daily routines, and other than the two locations I just mentioned, all other McDonald's restaurants are open in Venezuela. As always, we stand with our team and will provide them with the support they need until the situation on the ground normalizes. Just this past Monday, Colombia also experienced a significant earthquake. Our first priority has been the safety and well-being of our people. We are still working closely with the local management team as they assess the full impact of the earthquake on our people and restaurant operations. Let me now turn to the second quarter. Total revenue, adjusted EBITDA, and net income all grew strongly in USD, despite challenging consumer dynamics and year-over-year comparisons …
