Hello, and welcome to McDonald's third quarter 2023 investor conference call. At the request of McDonald's Corporation, this conference is being recorded. Following today's presentation, there will be a question-and-answer session for investors. At that time, investors only may ask a question by pressing star one on their touchtone phone. I would now like to turn the conference over to Mr. Mike Cieplak, Investor Relations Officer for McDonald's Corporation. Mr. Cieplak, you may begin. Good morning, everyone, and thank you for joining us. With me on the call today, our President and Chief Executive Officer, Chris Kempczinski, and Chief Financial Officer, Ian Borden. As a reminder, the forward-looking statements in our earnings release and 8-K filing also apply to our comments on the call today. Both of those documents are available on our website as are reconciliations of any non-GAAP financial measures mentioned on today's call, along with their corresponding GAAP measures. Following prepared remarks this morning, we will take your questions. Please limit yourself to one question and reenter the queue for additional questions. Just one other piece of housekeeping today before I turn it over to Chris. As many of you are aware, we'll host an investor update at our McDonald's headquarters on Wednesday, December 6th, where Chris and Ian will be joined by members of our senior leadership team to provide an update on our strategic priorities, followed by a Q&A session. I ask that you please be mindful of this with your questions on the call today and focus questions on our quarterly results in the current year. We'll spend more time on 2024 and our strategic priorities in December, with plenty of time for Q&A on that day. Details for the event and how to tune in can be found on the investor events section of our website. Today's conference call is being webcast and is also being recorded for replay via our website. Now I'll turn it over to Chris. Thanks, Mike, and good morning. Over the past quarter, we've seen yet again the broad-based momentum across the McDonald's business, despite continued headwinds and a challenging macro environment. Around the world, we're operating from a position of strength as the industry's market share leader. In Q3, we achieved comparable global sales of nearly 9%. As we expected and as we mentioned in prior earnings calls, our top line growth, while strong across each of our segments and at an elevated level versus historical norms, has continued to moderate. However, we continue to outpace our competitors, thanks to our system's outstanding execution of our Accelerating the Arches strategy. Over the past year, we've been more intentional about sharing and scaling world-class ideas that drive impact globally. Central to our continued strength is how we maximize our marketing to stay relevant to customers. In August, we launched As Featured In, in over 100 markets, making it our largest global campaign to date. The campaign celebrates the most memorable McDonald's references across the world of entertainment, with over 20 McDonald's integrations that span across Hollywood, Bollywood, anime, and independent film. It's also another proof point of the impact and power that a One McDonald's Way approach to marketing can have to drive engagement, allowing our markets to remain globally consistent but locally relevant. Celebrating our core equities, As Featured In demonstrates that McDonald's and our iconic menu is a cultural touchstone that immediately connects fans to characters and stories with over 85% positive consumer sentiment and in the top 30% of campaigns for customer engagement. As I recently visited Australia and New Zealand, I was energized to see other examples of One McDonald's Way in action, or One Macca's Way, as our friends down under call it. It was clear that our continued menu discipline and reduced restaurant complexity across these markets is driving operational improvements. By creating a One Macca's Way approach to the crew experience by utilizing consistent, comprehensive resources, we're creating a better customer experience as a result. Speaking of One McDonald's Way, Australia was our first market to launch Best Burger, and with resounding success. Great tasting burger perceptions continue to grow, and the Macca's team has reached an all-time high in beef burger share. And now Best Burger has been scaled to over 70 markets around the world, building on learnings from the original launch in Australia. Australia is also a good example of a market that has room to grow through new restaurant openings. We expand our footprint in the market from a position of strength. We're also enhancing existing restaurant capacity by introducing delivery rooms and integrated McCafé beverage cells that will allow us to better drive growth against our MCDs. We'll share more details on our plans related to the fourth D development in December at our investor update. McDonald's reliability, value, and feel-good experiences continue to play a key role in connecting to our customers, not just in Australia, but across all our markets, offering delicious food at an affordable price and at the convenience our customers have come to expect. It's promising that our markets continue to grow share despite the cost of living pressures. As we had expected early in the year, and have talked about on prior earnings calls, it's clear that consumers continue to be more discriminating about what and where they spend. Between inflation remaining high, the elevated cost of fuel, interest rates, housing affordability pressures, and more, consumers all over the world are having to pay more and more for everyday goods and services. Proven time and time again in difficult economic times, the McDonald's brand and our positioning on value is an opportunity for us. Take Germany, for example. The team has delivered remarkable results with the launch of the McSmart Menu earlier this year, offering smaller, more affordable meals. It's an incredible example of remaining agile and listening to our customers. Our German team heard from customers that they were craving these options, and McSmart made our menu more accessible to them, contributing to outperformance and value perceptions when compared to the rest of the industry. It was an important driver of delivering Germany's tenth quarter of double-digit sales growth. We're always pushing ourselves to stay one step ahead of the customer, as we have throughout our history, by innovating and reinventing ourselves, even as we're operating from a position of strength. McDonald's is one of those consumer brands that has the permission and power to be part of people's everyday lives, and one of the great things about McDonald's is that we don't rest on our laurels. We continue to find new ways to earn customer visits, and we believe the actions we've taken over the last several years have laid the foundation for our continued success. This starts with strong local leadership and franchisee alignment. When we combine that with a fully modernized estate, a globally recognized brand, delicious food on our core menu, and a high level of execution across our 4Ds, our competitive strength is on full display. And while the macro environment will remain uncertain, we believe our brand and our business are well positioned to win. This powerful combination of brand, physical advantages, and digital penetration has positioned us as an industry leader. And as we continue to keep a constant pulse on what's top of mind for our customers, we believe that we'll maintain our leadership position and continue to connect our brand to consumers in a way that drives growth and momentum for the business. I remain confident in our Accelerating the Arches strategy and the enduring strength of the McDonald's brand. I'll now turn it over to Ian. Thanks, Chris, and good morning. Our third quarter results yet again demonstrate strong restaurant-level execution across our Accelerating the Arches growth pillars, with significant increases in customer satisfaction across most of our major markets. Our restaurants are offering customers an affordable destination every day for delicious food and great service, driving nearly 9% global comp sales for the quarter. Thanks to the tireless efforts of our entire McDonald's system, the McDonald's brand remains stronger than ever. The resilience of our business is rooted in our ability to adapt to any environment. As expected, challenging macro dynamics continued this quarter, and consumer spending remained pressured. While top-line growth has continued to moderate in line with our expectations, we're outperforming the industry, and we remain the leader in value and affordability perception across most of our largest markets. Providing affordable options for our customers has always been core to McDonald's success, and continuing to evolve these options as customer needs change remains critical. As Chris mentioned a few minutes ago, it's clear that our customers continue to seek reasonably priced meals as rising costs persist and our markets around the world continue to respond. Germany delivered its highest ever monthly sales performance by focusing on the evolving needs of our customers amid increasing macro pressures. The market launched a Your Remix, Your Deal promotion exclusively in the app, allowing customers to build their own small bundles. Beyond affordability, this promotion offered the personalization our customers are looking for and significantly increased customer engagement, which was evident in an additional 1 million 90-day active loyalty members in the third quarter. This approach of smaller, more affordable bundles featuring our core menu favorites, was first highlighted earlier this year in Germany and the U.K., with the launch of new permanent value offerings and has since been adapted locally in other markets. In Canada, a highly competitive breakfast market, the team offered customers a more affordable option with a McMuffin and hot coffee pairing. By simply featuring our core products at a compelling price point during a critical day part, we drove market share gains in both breakfast and coffee, demonstrating how providing customers what they want at great value always resonates. The D123 Everyday Value Menu in the U.S. takes a similar approach to affordable bundles, with nationally promoted products at locally relevant price points. The platform features products such as the McDouble or 4-piece McNuggets. With a bundle offered at each day part, customers can visit McDonald's for an affordable meal, no matter the time of day. And while prices have evolved over time, the featured products have remained the same, providing customers with their familiar favorites from our core menu. This consistency in our value offerings means customers know exactly what to expect every time they visit us, driving our strong position as the affordability leader in the market. And in China, with slowing macroeconomic conditions and historically low consumer sentiment, the market relaunched a campaign with small price-pointed bundles featuring our hot, delicious burgers. Designed to engage our Gen Z consumers, this promotion drove meaningful customer demand and increased beef share in the market. Beyond the price of our food, we're continuing to provide customers with new experiences, further elevating their value perceptions. Many markets are using our digital app to drive engagement and increase loyalty participation with our fans through exclusive activations. This was on display through recent Monopoly campaigns in several markets.... Starting with Australia, where Monopoly contributed to record digital sales in the market for the quarter, fueled by higher app registrations and increased game piece redemptions. And in the U.K., Monopoly returned for the seventeenth consecutive year, featuring a Double Peel option, encouraging customers to scan their game pieces into the app. Monopoly once again ignited our fans' love of the brand and delivered higher levels of app engagement than ever before. Spain had similar success with their Monopoly promotion over the summer. Now leveraging the same app features as the U.K., the promotion delivered significant increases in both app downloads and registrations. This is another great example of sharing best bets across our system to fuel our digital growth ambitions. In fact, in our top six markets, digital sales represented more than 40% of system-wide sales, or nearly $9 billion for the third quarter. We now have over 57 million, 90-day active members across these top markets, and our relationship with them continues to grow. We're learning when they visit, how they visit, and what they buy, with more and more of our sales coming through identified channels than ever before. By continuing to elevate the McDonald's digital experience, our customers feel more connected to the brand, driving those incremental visits that we believe would otherwise go uncaptured, and it gives us more ways to reunite with customers who haven't visited us in a while. Beyond Monopoly, the brand was at the center of our marketing yet again this quarter, as we leveraged a One McDonald's Way approach to celebrating the FIFA Women's World Cup in July. With record-breaking viewership and fan engagement, our brand was part of a cultural moment, and we continued to elevate our creative excellence through a scalable, culturally relevant campaign. This came to life through global activations across 28 markets, tapping into local fan excitement, and was supported by a fully integrated social, digital, streaming, and content strategy. Even more exciting, we celebrated our restaurant teams by sending crew members who go above and beyond to attend the live matches. Across the As Featured In campaign, Monopoly activation, and the FIFA Women's World Cup, I can't think of another time when we better utilized our scale to leverage great marketing ideas across our system, which is a tangible demonstration of our Accelerating the Organization principles in practice. Our food is at the heart of our customers' relationship with the brand. This is why we're also taking a One McDonald's Way approach to our menu, further fueling our chicken ambition by scaling core chicken equities. Our McCrispy Chicken Sandwich continues to be an important driver of chicken share growth, having first launched in 2022 and now a billion-dollar brand across multiple markets. McCrispy was the most recently launched in Australia this quarter, where early results indicate a lift to chicken category sales while bringing a renewed focus to our chicken portfolio. The U.K. continued to drive excitement in chicken by creating fresh takes on our new global favorites. This past quarter, the market featured a new line extension, the McCrispy Deluxe, offered alongside the McCrispy and the McSpicy in the market. By combining strong execution of our core menu offerings with new flavor news and limited additional complexity, we continued to strengthen our chicken credibility with customers and maintained our market share leadership in the chicken category. Across each of our Accelerating the Arches growth pillars, it is clear that our playbook is working. Thanks to the resilience of our system and the strong execution across the M, C's, and D's, we're staying relevant to our customers as their needs continue to change. Turning to the P&L, our strong top-line performance drove adjusted earnings per share of $3.19 for the quarter. This is an increase over the prior year of 16% in constant currencies, excluding current year charges, primarily related to Accelerating the Organization restructuring costs. Our company-operated margin performance remains pressured by continued cost inflation, in line with our expectations. We expect these macro headwinds will continue in the fourth quarter. Strong franchise sales performance continues to be partially offset by targeted and temporary franchisee assistance provided mainly to our European franchisees, where elevated costs continue to pressure restaurant cash flows. We're still anticipating that these efforts will have an impact of $100 million-$150 million on our full year results. Total restaurant margin dollars grew by about $335 million in constant currencies or about 10% for the quarter. G&A for the quarter increased 1% in constant currency, and our adjusted effective tax rate for the quarter was nearly 21%. Adjusted year-to-date operating margin is 47.5%, driven by our strong top-line growth. For the full year, we now expect adjusted operating margin to be about 47%, including an expected property gain in other operating income in the fourth quarter and G&A of about 2.2% of system-wide sales. Foreign currency translation positively impacted third quarter results by about $0.08 per share, with a slight tailwind expected for the full year. As I wrap up, I want to touch on the recent dividend increase approved by our board of directors in early October. This marks our second consecutive annual increase of 10%, and we're extremely proud of our track record of delivering meaningful cash return to shareholders, marked by our 47th consecutive dividend increase. This demonstrates our confidence in the Accelerating the Arches strategy and our commitment to a long-term growth for the system and our shareholders. I look forward to sharing more with you at our investor update in December. With that, I'm going to turn it back over to Chris. Thanks, Ian. As we continue to operate in a challenging macro environment, what remains unwavering is our commitment to creating an environment where the entire McDonald's system thrives together. Through our Accelerating the Arches strategy, we've acquired an industry-leading digital loyalty base that complements our restaurant footprint. We're retaining top talent who are passionate about the McDonald's brand. Our restaurant teams are executing at a high level. Customer satisfaction is increasing, and we continue to attract the best franchisees in the world as a franchisor of choice. Despite ongoing legislative and regulatory headwinds, we are committed to mobilizing our system to protect franchisee decision-making at a local level and on building a long-term presence in civic spaces to advocate for policies that benefit local restaurant owners and the communities they serve. We're also fulfilling our purpose of feeding and fostering community. In September, we hosted our second Global Volunteer Month, where over 6,400 volunteers across 12 markets spent an estimated 26,000 hours giving back to local communities. At the beginning of October, McDonald's was named to Fast Company's list of Brands That Matter for company whose work is moving the needle on critical issues, and that display the highest level of commitment to their purpose and values. While our strategy is working, our customers continue to expect even more of us, and we're prepared to meet that challenge. What Ray Kroc said in 1967 still stands true today: "We are living in a rapidly changing world, so McDonald's will change with it. Change is our only constant." As was the case for those who came before us, who built McDonald's into the global leader it is today, we will earn our success, and together, as a system, we will lay the foundation for our future. On Wednesday, December 6th, I hope you'll join us to hear more at our investor update as we look to the growth potential that lies ahead and share our plans for the future. Makes me excited to think about what the next five to 10 years will bring for McDonald's. We believe that because we're operating from a position of strength with a strategy that continues to deliver, we now have the opportunity, the ability, and the obligation to reimagine our brand for the future. I look forward to seeing you in Chicago this December, and now I'll hand it over to Mike for Q&A. Thank you. As a reminder, if you are an investor and would like to ask a question, please press star followed by the number one on your telephone keypad. We ask that you limit yourself to one question and re-queue for any additional questions. Our first question is from John Ivankoe with JP Morgan. Hi, thank you very much. Obviously, you know, value is a big focus on this call, and I wanted to ask, you know, I guess, to focus on value in the context of recent average ticket increases, you know, for you and really across the sector, much of which driven by premiumization, customization, you know, larger sizes, what have you. In other words, pricing increases in average ticket beyond just out of price. So, you know, as we talk about value, what does that mean to future price increases? And is there an intention, you know, to do value, in particular, bundle value, to where the average ticket can be protected? Or would you sacrifice some average ticket in order to get future market share gains and presumably transaction gains? Thank you. Yeah, thanks, John. You know, on value, I think it's always a focus at McDonald's. I mean, we're a business built on value and convenience with great tasting food, so we're always keen to focus on value. I think certainly given the inflation that the market has experienced, that we've experienced over the last year, really more than a year, we've tried to be very choiceful and disciplined on how we have executed those price increases. The good news is, we continue to lead on affordability. We continue to lead on value for money. We've seen no deterioration in our advantages there, we are holding those up. How we do it varies by market, so I wouldn't give you a generalized statement about how we approach value. It's up to each individual market to think about how they continue to deliver the customer great value. But I can tell you, on, on every single major market that we look at, the teams are doing a great job on value. They're delivering against it, and we're seeing really no change at all in terms of customer acceptance pass through on pricing, which to me is also an indication that the teams are striking the right balance. Our next question is from David Palmer with Evercore. Thanks. Yeah, and thanks for the color on the marketing initiatives in the IOM countries. And it does sound like there's a bit more focus on value, but I'd love to hear how trends might be settling out in these big IOM countries, the big five, so to speak, in the post-COVID mobility recovery world. In other words, maybe back to school might be a good way to look at that. You know, as you get past the tourism boost of the summer, maybe you're getting a sense of what type of comps we should be expecting for these IOM markets. So any color about, you know, the type of consumer environment you're seeing in these markets, how same-store sales trends really exited the quarter, would be very helpful. Yeah, thanks, David. I'll start at a high level and then hand it over to Ian to give you any more texture on that. But at a high level, we continue to be very pleased with how our IOM business is performing. We're seeing whether you look on the quarter, the year, or a four-year stack, this business is continuing to perform very well. Overall, we're also seeing that there's great execution. We're seeing customer satisfaction scores increasing in almost all of our major IOM markets. So overall, we feel good. In Europe, in particular, we've certainly seen more inflation in Europe, and so the team there has had to be probably even more laser-focused on making sure that we deliver great value. But the business overall, you know, not seeing any big change quarter to quarter in terms of how it's performing. But I'll give it over to Ian to give you some more texture. Morning, David. Yeah, just maybe a couple of builds to what Chris mentioned. I mean, again, I think if you look at the comps for the quarter across IOM at 8.3%, that's a pretty strong indication of the consistency and fundamental underlying momentum that we've got in the segment. We had positive traffic growth in the segment, which I think is an indication of, you know, how that momentum is obviously from a sales and traffic perspective, and we're continuing to grow market share across the majority of those large markets. Which tells us, despite, as Chris talked to, some of the different macro or consumer environments in those markets, which are obviously varied. Obviously, some of those markets, there's a fair bit of pressure. From a macro headwind or consumer headwind, we're continuing to do well versus the landscapes around us. I mean, I think we have spoken, and you heard it in our opening remarks, around the expectation that we're gonna continue to see moderation in that top line as inflation levels continue to come down, and obviously, pricing comes down in line with that. But I think we're in a really good spot, and I think that just speaks to how our strategic plan around Accelerating the Arches continues to resonate with consumers consistently across the business. Our next question is from David Tarantino with Baird. Hi, good morning. My question's on the cost side. I think you lowered your SG&A outlook, at least as a percentage of system sales, versus what you had given us last time. I was just wondering what changed in that outlook? Is it a matter of some of the savings and accelerating the organization coming through or delays in investment spending? I guess any context you could give us on that front would be helpful. Thank you. Morning, David. Ian, obviously, so let me try and give you some color there. I mean, I think as we said in our guidance at the beginning of the year, we expected G&A as a percentage of sales to be in the range of 2.2-2.3. And obviously, we've updated that to say more about 2.2. So it's come down marginally. I think obviously we've had some really strong top-line results this year, so obviously that's a partial element of the benefits. And I think the other part is just timing of spend. I mean, we are kind of a back-half weighted spend cycle within the business. I think fourth quarter, more pronounced, from a quarterly standpoint, so we do expect a higher level of spending as we get into the fourth quarter. But I think just, you know, there's a timing element of just kind of how, you know, the investments that we're making. I talked about kind of two areas on our last quarterly call, where we continue to invest. One is behind technology and digital, which we believe are continue to provide strong opportunities for growth, and we're going to continue to invest when we have those opportunities. I think we've got a pretty strong track record in how those investments are delivering for the business. The other area is around our Global Business Services organization, which we stood up earlier this year as part of accelerating the organization. We spent a lot of time over the last six months or so looking at what we believe the opportunities are for the business there. I think we've got good line of sight into some things that we think can drive kind of sustainable efficiencies from an operational perspective as we go forward, and we're certainly investing now behind some of those areas of opportunity. So what I would call it a little bit more of kind of the timing of spend around those initiatives and more of a focus in the first half of the year on kind of bringing our ATO organizational changes to life. Our next question is from Jeff Bernstein with Barclays. Great. Thank you very much. Just focused on the U.S. consumer. I'm just wondering if you'd talk about any change in behavior, whether there was a change in trend through the quarter or recently into the fourth quarter. I was wondering if there's pressure in some areas, maybe benefit from trade down in others? But otherwise, you mentioned in the release, I think, that the U.S. comp was driven by strategic menu pricing, no mention of the traffic. So I'm just wondering if you could maybe give a breakdown of that U.S. comp components, whether the lack of traffic growth is a concern looking at 2024, how you think about those components within that U.S. comp? Thank you. Yeah, thanks for the question, Jeff, and I'll answer, and then if Ian has anything else, he wants to pick up on this. But, specific to the U.S., you know, we've been talking about how the consumer is more discriminating, because of all the price pressures that they're facing, as well as interest rates, things like that. What you end up seeing is that the pressure is felt more on the lower income consumer. And so one of the things that we saw industry-wide is that that low-income consumer, which we would say is $45,000 and under, was negative from an industry standpoint. If you zoom out and you think about our performance relative to that, we continue to have, on the full year basis, traffic growth. We had a slight dip in traffic. We went slightly negative in Q3. We expected that because of what we were lapping. But if you look at us on a two-year stack, in the quarter, our traffic is up strongly. So, I think we're just going to need to continue to keep a close eye on that $45,000 and under consumer, because of the pressure that they're feeling there, and make sure that, you know, we're offering value, but hopefully, the industry stays disciplined as well on pricing. Maybe just, I'll just add a bit of a build to Chris's commentary, which certainly has hit the headlines, but just maybe because I think the texture is really important in the quarter. I mean, I think the headline would be on an overall basis, that we maintained our QSR traffic market share in the quarter. I think we continue to see really strong share gains in both beef and chicken being the kind of two key elements of the category. We continued to gain share with both the middle and higher income consumers, and that speaks a little bit, Jeff, to what you called out, which is that we're certainly partly benefiting from the trade down from more expensive alternatives within those kind of income or segment levels. We held share with the lower income consumer in a pretty competitive marketplace. But I think the headline is that the comparable, as Chris talked about, industry traffic was down in the quarter, as it has been for the last couple of quarters, and so our comparable traffic was marginally down as a result of that. And I think just—you know, I think I just would want to highlight, I think, the strength of our top-line performance overall through our comp sales, which remain industry leading, as you've seen in what we've announced for this quarter. And I think that's a combination of our strategic strengths coming together, which we've been working on over the last couple of years. You know, we've got a fully modernized estate. We've got a digital platform that's coming to life at scale, that's allowing us to really interact with our consumers on a much more individual basis. Our marketing execution, which I think has really been elevated and is resonating in a more culturally relevant way with our consumers. And then I would just call out, I think, and this is really specific to the U.S. business, the outstanding execution our whole system is delivering. We know we're delivering a better experience for customers. We know we're better staffed, and as Chris talked about earlier, we know we've got a leading position on value for money and affordability. And so I think as a result of all of that, we certainly believe we continue to be in an advantaged position as we continue to kind of lean into these macro headwinds that we're obviously having to navigate. Our next question is from Eric Gonzalez with KeyBanc. Hey, thanks for the comments on traffic, and I'm wondering if you could expand on the pricing discussion. I think last quarter you said you expected pricing to be in the double digits for the year. So if you can comment on what that might imply for the fourth quarter, and perhaps you can give us an early look on what we should expect for 2024, whether that would be that you expect prices to be a little bit more normalized than what we've seen in the last few years. Thanks. Morning, Eric. It's Ian. So let me talk a little bit about pricing, and I obviously, this is specific to the US, because obviously, pricing varies across markets depending on the context in the individual marketplace. I think as I talked about last quarter, certainly continue to believe that our average pricing level in the U.S. business for the full year will be just over 10%. I think what we did see in quarter three, and this is the first time now in a number of quarters, is that our average pricing level has started to come down in terms of the rate of increase. I think that speaks to the fact, as we've spoken to before, that inflation is starting to come down, and of course, we expect pricing to come down kind of in line with how inflation's coming down. I think as we've talked about before, you know, our U.S. business has been really disciplined in how they have continued to take pricing. We've put a lot of effort in over the last couple of years to I think the data and analytical capability that comes from our third-party advisors, who obviously make pricing recommendations to our business, including our franchisees, who obviously make their own pricing decisions. And I think the fact that we continue to maintain that leadership position in both value for money and affordability speaks to the fact that even though we've obviously had elevated pricing levels on the back of elevated cost and inflationary pressures, that we have been able to execute that in a way that has minimized the resistance from the customer and maximize the flow-through that we're getting as a result of those price increases. I would say our flow-through continues to kind of be in line with historical norms, which I think speaks to the capability and the precision that we've been able to deliver with pricing. So again, I think as we've talked about moderation, I think part of that will be pricing if inflation continues to kind of come down, as we look forward. Our next question is from Dennis Geiger, with UBS. Great, thank you. I wanted to just ask a bit more on how you're thinking about maintaining that underlying momentum and share, share gains in, in the U.S. As you think about some of the, the key drivers in place across the three Ds, the operational execution that you're speaking to, value, the Ready on Arrival, Best Burger, et cetera. Chris, can you, can you sort of unpack latest thoughts on, on some of these most impactful traffic and sales opportunities into next year and, and even beyond? Thank you. Great. Well, thanks for the question. I guess I'd start with, I look forward to seeing you at December 6th, 'cause we'll get into a lot more, in that about how we see the outlook for next year and, and some of the specific things, that we've got planned to, to continue to drive the business. But I would say broadly, we think our strategy, our Accelerating the Arches strategy, still has a lot of runway in it. Each of the growth pillars, the, the marketing, core menu, and, and 4Ds, we think that there's, still a lot more that we can do, underneath each of those. Again, we'll be more specific about what that is on December the 6th. And then if you think about more broadly, what's happening right now is, this business is starting to amass on the digital side some pretty significant scale. And the scale that we're building on the digital side opens up a lot of opportunities that we think, quite honestly, are gonna be difficult for our competitors to match. And so when you take our physical presence, having more restaurants in the U.S. than anyone else, our digital presence, which is bigger than anybody else in the U.S., along with great execution, which we're seeing with strong consumer satisfaction scores, our service times are down roughly nine seconds in the quarter. They're down slightly less than that, but still down, I think about seven seconds on the full year. We're in a really strong position in the U.S., to continue the growth that we've got. Maybe one just small build, Dennis, and I'm, I'll be a bit of a broken record on this, but I just, I wouldn't underestimate some of those things that we've done over the last couple of years, like the fully modernized estate. I mean, imagine, and this is the situation that some of our competitors are in today, that you're trying to do that today in an environment of pressured cash flows and higher interest rates. I mean, we've got a fully modernized estate. As Chris talked about, we've got a modernized digital platform that continues to grow, and I, I think that's fundamentally some of the significant investments that we've made, have been critically important as we head into this more kind of macro headwind and volatility. Yeah, just one thing Ian said that triggered as well, a thought, which is being able to drive the business, we need our franchisees to be in a strong position. Franchisee cash flow in the U.S. is up this year. We're up in the quarter. So I think that just goes to sentiment. It's much more challenging, as you would imagine, to continue to drive the business if the franchisees are not seeing it flow through. Fortunately for us, we're seeing good flow-through for our franchisees, despite having to absorb quite a bit of inflation, both on the food and paper side, as well as on the labor side. So that's another thing that gives us confidence as we head into the new year. Our next question is from Lauren Silberman with Deutsche Bank. Thank you. Appreciate it. I just wanted to follow up on the commentary regarding the competitive environment. Can you talk about what you're seeing in the promotional environment, any uptick in discounting across the industry? And how might your approach to value change if the consumer gets weaker? Then, I guess, related, any color on same-store sales across different day parts or any greater competitive activity in certain day parts? Thank you. Yeah, I'll take the overall terms of the competitive landscape, and I'll let Ian speak specifically to the day part question. But overall, I think what you're seeing there is everybody is looking to make sure that they are competitive from a value standpoint with the consumer. And particularly, I talked about earlier, that low-income consumer, which I would say is, you know, let's call that in this particular instance, $45,000 and under. That part of the business, we're seeing traffic in the quarter was down. There is a step-up that we're seeing in some promotional activity by some of our competitors, but nothing alarming on that. Nothing that, you know, I'd say is looking to be what we would say is beyond prudent. So we're gonna just continue to monitor it. We are focused on maintaining our value leadership, and we're going to do what we need to do, to maintain our value leadership. But I think we've also got lots of things. It goes beyond just price. It incorporates, delivering a better customer experience, which we're doing through faster service times, improved hospitality. It goes to doing through that through a modernized estate, which we've got, that is, not something true across the rest of the industry. And we're seeing great execution, which means consumers are getting hotter, faster, better tasting food. So all those things go into value perception, which is why we're seeing our value perception, hold up, in the industry despite some of these pressures. So I don't foresee any big changes there, but certainly everybody is paying attention to that. For the specific day parts, I'll let Ian talk about that a little bit more. Yeah, morning, Lauren. I just maybe build on the day parts, and I'm again, I'm using the U.S. as the specific context, is we've had pretty strong and consistent performance across all the day parts in the business. So I don't think there's a, you know, one day part that I would call out where we aren't seeing strong performance. I do think as we've seen, kind of, I'll call it a bit of the more return to work and return to office routine, there's probably a little bit more pressure in the breakfast day part, just as some of those competitors who've been further behind in recovery are kind of coming to life in that category. But again, we're continuing to see good performance there. Maybe the only other build, and this is a bit with an international lens on value, is you've heard us speak to some of the, I would call it adjustments that some of our international markets have made to value. Maybe one I would just call out is in Canada, where the team there put a morning offer in place, which was a McMuffin and coffee pairing. Breakfast in Canada is a pretty important day part. Coffee is a pretty important part of that day part. And so I think our markets are gonna continue to front foot it and proactively make sure that we're adjusting value, so it's relevant to what our consumers are looking for as the context continues to evolve. And value, as Chris talked about, is a strategic part of our fundamental business model, but we are obviously gonna continue to listen to our customers and make sure we're delivering what they need and what they expect from us. Our next question is from Brian Bittner with Oppenheimer. Thanks. Good morning. As it relates to the U.S. company-owned restaurant margins, they expanded this quarter for the first time in two years. Albeit modestly, but a good indication of maybe your, your franchise store level margins as well. What, what was the biggest driver of this? Was it simply, easing food cost inflation against still strong pricing, or, or was there anything else to point to? And, and could this be a potential turning point for, for restaurant margin stabilization in the U.S. or, or maybe even perhaps some expansion moving forward? Morning, Brian. Yeah, thanks for the question. Look, I think what I would say on, on, company-operated restaurant margins, you know, we've been pretty consistent in... If you look at the full year 2023, we expect, company-operated margin percent, both in the U.S. and IOM, to be in line, roughly with where we landed in quarter four, 2022. I think that view hasn't changed. Obviously, we've had really strong sales performance this year, which is, which is helping. And I think as you've heard me talk about before, the only way you sustainably work through periods of higher inflation in the business is obviously to continue to grow, the top line and, and deliver strong performance. That's what we're focused on, and we're obviously very confident as we're able to continue to do that, that we're gonna be able to kind of see improved restaurant margin from a percentage basis performance, in addition, obviously, to the really strong dollar growth that we're seeing on the back of those strong top-line sales. I think no change to what we expect for the full year this year, but I think we feel like we're in really good position with the momentum we've got across the business. The other thing that I would just add on the McOpCo side, but it's also something that we've seen with franchisees, is they're experiencing these gains even though roster sizes are growing. And I think part of the benefit that we're seeing is turnover is down. So we're even as we're expanding roster sizes in our McOpCo restaurants, the team has done a really nice job, and we're seeing turnover levels down pretty significantly from prior year. And all of that has benefits associated with it. Of course, you have less training, but you also have improved execution. So I think that's one thing that we're seeing. That also, as you extend out to franchisees, franchisees roster sizes are up versus last year. Applications are up significantly. So I do think, to this question about is something turning on the labor side in the U.S., we're definitely seeing a turn there to the positive in terms of having our restaurants fully staffed and having lower turnover as a result of that. Our next question is from Brian Harbour with Morgan Stanley. Yeah, thank you. Good morning. You commented sort of on the U.S. side, but just within IOM and IDL, same store sales, wondering if you had any comments on kind of the check versus traffic component. And then also just within the US, I was curious if you had a sense for, roughly how much your California franchisees will be seeing wages go up and how much, you know, pricing they might presumably take to offset that? . Yeah, I'll cover just the California question, and then Ian can cover the rest of what you laid out specifically around IOM. But as you mentioned and noted, you know, California, with the passage of the recent legislation there, around what that's gonna do to wages, there is gonna be a wage impact for our California franchisees. I don't think at this point we can say exactly how much of that is gonna work its way in through pricing. Certainly, there's gonna be some element of that that does need to be worked through with higher pricing. There's also gonna be things that I know that the franchisees and our teams there are gonna be looking around productivity. How all of that plays out, there will certainly be a hit, a hit in the short term, to franchisee cash flow in California. Tough to know exactly what that hit will be because of some of the mitigation efforts, but there will be a hit. Longer term, what we've been talking about with our franchisees is this is an opportunity for us to gain share, because this is an impact that's gonna hit all of our competitors. We're in a better position... We believe we're in a better position than our competitors to weather this, and so let's use this as an opportunity to actually accelerate our growth in California, and accelerating our growth along with some mitigation. The two of those in combination is the best way to minimize any impact long term on franchisee cash flow. With that, on California, let me have Ian just cover the rest of your questions on IOM. Yeah. Morning, Brian. So, let me try and give you a bit of texture on kind of IOM and IDL. I mean, I think you've obviously seen the headline comp numbers for the quarter, which I think are obviously really strong, and I would say the consistency is the broad-based, and I think consistency of the momentum we're seeing, which just goes back to what we've talked about earlier today, which is our Accelerating the Arches strategy continues to really deliver pretty consistent results across the business. I mean, of course, when there are 100+ markets, there are always a couple of markets that are maybe dealing with more kinda headwinds than others. I mean, I think in IOM, France would certainly be one of those markets. We spoke a little bit about that on the quarter two call, but I think if you look at the, the IEO sector in France still hasn't recovered back to where it was in 2019. I mean, we have generally been taking share in the marketplace, but I think the consumer sentiment with everything that's going on, which is consistent, obviously, across all markets, higher inflation, higher interest rates, and then I think, you know, in France, as we worked through the summer, you saw a level of social unrest. You saw some kind of violent activity coming out of that social unrest. I think that's all kind of dampened consumer demand. I think our team in France is really, really focused on having good clarity on what we need to continue to do, and we're gonna continue to deliver even in that more difficult environment. But broadly speaking, consistently, you know, really strong and consistent performance across the business, that we're very, very pleased with. Our next question is from Jon Tower with Citi. Great. Thanks for taking the question. First, clarification, and then a question. Ian, could you provide potential range of the size of the property gain in the fourth quarter? And then second, I'm just curious to gain your thoughts on the recent NLRB ruling that's set to be implemented, I believe, in December, and how you think this might influence your own business or that of the industry in the years ahead. Jon, it's Ian. Let me take the first one, and then I'll turn it over to Chris on the NLRB. On the property gain, which is in our IOM segment, we expect that to be about $60 million. You know, I think we've, you've probably heard us talk before. We get these kinda high-value individual properties that sometimes the highest and best use is different than what we're using it for today. This is an example of that. I don't think we certainly expect these are gonna be occurring very often, but this is a case where that was just a good business decision to make, and that's what we're expecting in quarter four on that. Yeah, and on the NLRB ruling, I mean, as you would expect, we strongly object to last week's NLRB ruling. We think it's gonna undermine small business ownership in the U.S. If you think about it, the franchise business model, it's really a great American innovation. It's created wealth for thousands, particularly underrepresented minorities and women, and this is something we think that needs to be supported, not attacked. And so, in our mind, this is yet another example of agency overreach, coming out of D.C., and we expect it's gonna be contested. It's gonna be contested in the courts, it's gonna be contested in Congress. In fact, you may have seen already, the Senate has indicated they're gonna seek to pass a continuing resolution, which is in opposition to this ruling. So McDonald's certainly opposes it. We're gonna support others who oppose it. How it all plays out in time, I think, you know, it's tough to say, but this is something that's gonna affect everybody. And as we've shown throughout time, so long as there's a level playing field and McDonald's is on the same level as everybody else, we tend to win. And so even if this NLRB ruling were to pass, it's gonna affect the industry at large, and we think we're better positioned than anybody else to withstand it. Our next question is from Andy Barish with Jefferies. Good morning. Just shifting gears to IOM for a moment. Can you give us roughly how much of the $100 million-$150 million in subsidies has shown up so far? And then, you know, on the company-owned margin question, but related to IOM, I mean, this used to be a 20%, you know, margin business, obviously more pricing in the business today. Any, you know, any thoughts longer term about kind of realizing back to 20% restaurant level margins in this segment? Morning, Andy, it's Ian. So I think on the subsidies, I guess that the headline would be, you know, we expect to spend in line with what we've said consistently for the year, $100 million-$150 million. And so I think we're, we're tracking in line with that, where you'd expect us to be at this point in the year, is what I would say on that. I think in terms of longer-term margins, I mean, I mean, if you go back over our 60-year history, I mean, we've, we've had obviously many periods of higher inflation that we've had to work through over time. We've always been able to kind of get margins back, as we're able to continue to drive strong top-line growth, and I certainly don't see any reason why that would be different this time. I mean, I think we're gonna make sure, as you've heard us talk about today, that we stay really disciplined in how we're pricing to the consumer. We feel we've got a lot of capability, data, and analytical capability that's allowing us to do that better than most. And we also have, you know, industry-leading momentum as you continue to see in our results. If you are able to have industry-leading momentum, and as you heard Chris talk about, you continue to invest in those structural advantages, whether that's the fully modernized state, digital platforms at scale. Obviously, you're gonna be in an advantaged position versus others, and how you can kind of continue to let that flow through the business. I think that's certainly what we expect as we look forward on margins and the ability to kind of build those as we continue. We have time for one more question. Brian Mullan with Piper Sandler. Hey, thank you. Just a question on development specific to the U.S. Can you perhaps comment on the takeaway-only location in Texas? Any early learnings you've had thus far? I imagine we might hear more about this at the Investor Day, but just high level, do you expect new formats to have the potential to play a more meaningful role in the future U.S. unit growth? Yeah, so you're right. We will talk a little bit more about this, actually, a lot more about this, when we get together on December 6th. We're continuing to follow and assess the test that we have down in Texas. I think you can say that certainly there is gonna be an opportunity for us to have restaurants that are smaller footprint, that don't have a dining room. You know, you will see some of those, but I think from a development standpoint, the vast majority of the development opportunity that we see is for our traditional restaurants. We think that there's still quite a bit of opportunity for traditional restaurants. That will be the bulk of it. You might see again, you know, something around the edges, which is some of these smaller formats. But the big idea is traditional restaurants that we'll talk more about on December the 6th. Okay. Thank you, Chris. Thank you, Ian. That completes our call today. Thanks, everyone, for joining. This concludes McDonald's Corporation investor call. You may now disconnect and have a great day.