Q2FY25 comparison: McDonald’s (Westlife) vs. Burger King (RBA)

The competition in the quick-service restaurant (QSR) business is intense. In India, McDonald’s and Burger King are prominent players, with their franchisee operators listed under Westlife Foodworks (operating McDonald’s) and Restaurant Brands Asia (RBA, operating Burger King).

Revenue growth

RBA reported consolidated revenue of ₹632 crore (₹492 crore from India and ₹140 crore from Indonesia) in Q2FY25, marking a 1.2% YoY increase, driven by new store additions. Westlife Foodworks achieved revenue of ₹618 crore, with a modest 0.6% YoY growth. Both companies faced slower growth than previous quarters, highlighting the challenge of sustaining momentum.

Same-store sales growth (SSSG)

SSSG, a critical measure of existing outlet performance, showed a dismal growth in the recent quarterly results.RBA’s SSSG declined by 3%—its first dip in nearly two years—due to pricing adjustments aimed at improving delivery profitability and subdued consumer demand. Westlife saw an even steeper 6.5% drop, driven by reduced in-store activity. Both companies are experimenting with value-driven strategies to boost traffic, but results remain limited.

Profitability

Profitability in Q2FY25 presents a contrasting picture. RBA improved its restaurant EBITDA margin to 16.3% (from 15.8% YoY) and maintained its company EBITDA margin at 9.7% (vs. 9.8% YoY) by controlling costs. Conversely, Westlife’s restaurant operating margin dropped to 18.6% (from 22.1% YoY), while its operating EBITDA margin fell to 12.8% (from 16.2% YoY), impacted by rising operating costs and royalty payments.

Digitalisation

Digital sales were a bright spot for both brands. RBA processed 91% of dine-in orders via kiosks or the BK app, with 20% of total transactions being digital. Similarly, Westlife reported that 72% of its sales originated from digital platforms, driven by MyMcDonald’s Rewards program and growing app downloads. Both companies are heavily investing in technology to enhance customer experience.

Store expansion

Store expansion is a key component of both companies' growth strategies. RBA added eight new stores in the quarter, bringing its total to 464 and targeting 510 by FY25-end. Westlife also added eight stores (despite closing three), ending the quarter with 408 outlets and aiming for 45–50 additions this fiscal year.

Strategic focus

RBA focuses on driving dine-in traffic through value offerings, enhancing delivery profitability, and advancing digital transformation. Westlife is betting on product innovation, such as its McCrispy launch, scaling operations, and aggressive store expansion to improve profitability over time. The Q2FY25 results underline the challenges of maintaining growth and profitability in a competitive market. While RBA has stabilized margins, Westlife faces declining profitability. Yet, both brands remain committed to long-term growth through digital innovation and expansion, ensuring the QSR battle in India is far from over.