Arcos Dorados Roars Back into Growth Mode: Strong Q4 2025 Results Showcase Resilience Amidst Market Pressures
Arcos Dorados, the largest fast-food chain in Latin America and the Caribbean, has delivered a remarkable performance in its fourth quarter (Q4) of 2025. The company's latest earnings webcast revealed robust revenue growth, expanded margins, and strong adjusted EBITDA growth despite facing ongoing cost and consumer pressures in certain markets.
The Q4 results marked a solid finish to the year for Arcos Dorados, with total revenue reaching $1.3 billion, representing 10.7% growth. This impressive performance was driven by 16% higher system-wide comparable sales, in line with the blended inflation of the 21 markets in the company's footprint. The increase in comparable sales was primarily attributed to average check, reflecting disciplined pricing, effective promotional execution, and the continued strength of the company's digital and loyalty platforms.
CEO Luis Raganato highlighted the company's focus on three key priorities: optimizing today's business performance, maximizing returns on capital investments, especially those related to growth, and preparing for tomorrow's business trends. The Q4 results demonstrated progress across all three areas, with teams executing with discipline on pricing, cost control, and marketing relevance while continuing to invest in high return restaurant development and digital capabilities.
Adjusted EBITDA totaled $172.7 million, up 17.2% year-over-year, representing an 80 basis points expansion of the adjusted EBITDA margin. This included a net tax benefit in Brazil that CFO Mariano Tannenbaum explained in more detail. For the full year, system-wide comparable sales growth was in line with the company's blended inflation rate, with particularly strong performance in Mexico, Argentina, and several other SLAD markets.
The company also reported full-year adjusted EBITDA as its highest ever, boosted by the net tax benefits recognized. Together with strong USD growth in both SLAD and NOLAD, this tax benefit more than offset the impact of higher food and paper costs and lower consumption in the Brazilian market.
CEO Raganato emphasized that the strength of Arcos Dorados' marketing, digital, and loyalty platforms has helped differentiate the company from competitors by enhancing the brand experience across all channels. The company also expanded its brand presence in 2025 by opening 102 restaurants and bringing the modernized percentage of the portfolio up to 73% at year-end.
Some notable initiatives that contributed to sales growth during the quarter included marketing activities, such as a fully integrated menu strategy leveraging the cultural relevance of the Stranger Things Netflix series. This campaign boosted sales, drove high levels of engagement, and fostered meaningful brand conversations among consumers. Additionally, value platforms like Economia in Brazil and McPorMenos in Chile performed well with price-sensitive consumers.
Menu innovation also played a significant role, with new offerings such as a chicken sandwich in Colombia and limited-time flavors within the dessert category, such as Ovomaltine in Brazil.
