Arcos Dorados Holdings Inc. (NYSE: ARCO) announced its long-term financial framework, targeting mid- to high-single digit annual revenue growth and high-single to low-double digit annual Adjusted EBITDA growth.

The company will host its 2026 Investor Day today, where Executive Chairman Woods Staton and CEO Luis Raganato will outline these ambitions alongside a significant capital expenditure plan for the 2027 through 2030 period.

Capital expenditure and expansion plans

From 2027 through 2030, Arcos Dorados expects to open 550 to 600 restaurants. This expansion is supported by a capital expenditure program totaling $1.3 to $1.5 billion.

The company describes this as the next phase of profitable growth, leveraging the scale and capabilities built over four decades since opening the first McDonald’s restaurant in Buenos Aires.

Financial outlook summary

What the Numbers Show

The disclosed capital expenditure range of $1.3 to $1.5 billion against the planned opening of 550 to 600 restaurants implies an average investment intensity of approximately $2.2 million to $2.7 million per new unit over the four-year period. This figure reflects the capital required to establish new locations within the existing operational framework of the world’s largest independent McDonald’s franchisee.

Operational context

Arcos Dorados operates more than 2,500 restaurants across 21 Latin American and Caribbean countries and territories. As of June 30, 2026, the network employs more than 100,000 people. The company holds exclusive rights to own, operate, and sub-franchise McDonald’s restaurants in these regions.

Management presentations began at 9:00 am ET, followed by a live question-and-answer session. Presentation slides and webcast replays are available via the company’s Investor Relations website.

Arcos Dorados Holdings (NYSE: ARCO) delivered its highest-ever quarterly revenue in the second quarter of 2026, reaching $1.3 billion, a 14% increase year-over-year. The Latin American McDonald's franchisee also reported record adjusted EBITDA and net income, supported by strong performance in Brazil and effective cost management across its footprint.

Financial Performance

Total revenue growth was driven by a 15.3% increase in systemwide comparable sales, primarily due to a higher average check and improved guest volume. Adjusted EBITDA totaled $126.8 million, rising more than 20% from the prior-year period. Excluding a one-time transaction with a Mexican subfranchisee recorded in last year's results, the adjusted EBITDA margin expanded by 70 basis points.

Net income reached a record high for the quarter, with earnings per share doubling compared to the same period last year. This improvement was fueled by solid operating results, lower net interest expense due to capital structure optimization, and a reduced effective tax rate.

Regional Highlights

Brazil emerged as the standout performer, with adjusted EBITDA growing more than 40% in US dollar terms. The division achieved an EBITDA margin of 14.6%, an expansion of 180 basis points driven by lower food and paper costs, disciplined G&A management following late-2025 restructuring, and currency appreciation. Sales in Brazil grew more than 25% in US dollars, aided by strong home sales and new restaurant openings.

In North Latin America (NOLAD), comparable sales faced a demanding comparison base due to the prior year's Holy Week period and successful Minecraft promotion. Despite modest guest volume growth, the division maintained resilience through strong brand positioning and value propositions. In South Latin America (SLAD), sales grew in line with inflation, which averaged 46-47% in the region. SLAD's adjusted EBITDA grew by approximately $3 million (6.6%), with margins remaining stable at around 10%.

What the Numbers Show

Digital channels are becoming the dominant driver of top-line growth, now accounting for 66% of total sales after expanding by over 25% year-over-year. This shift coincides with identified sales surpassing 28% of total transactions, indicating that loyalty program engagement is directly correlating with higher digital penetration. The data suggests that Arcos Dorados is successfully converting casual traffic into repeatable, high-frequency digital interactions, particularly through self-ordered kiosks and delivery aggregators in Brazil.

Operational Updates

The company opened 16 new restaurants in the quarter, bringing the first-half total to 35. Capital expenditures for the quarter were $49.1 million, contributing to a total H1 spend of nearly $86 million. More than 77% of the portfolio has now been modernized. Management noted that freestanding units continue to account for the bulk of new openings.

Arcos Dorados also completed the second liability management transaction of the year, fully repaying its 2029 senior notes. Net leverage improved modestly to 1.1 times at quarter-end, supported by strong cash generation and lower capital expenditures relative to operating cash flow.