Oh, the times they are a-changin’! Change is inevitable — be it at the Disney Parks or the non-theme park world. Sometimes those changes are a product of trends and one major trend has us contemplating the future of a major fast-food chain.

We make it a point to follow the trends, especially at the Disney Parks. For example, last month we noticed Ozempic’s (a Type 2 diabetes medication now also used for weight management) rise in popularity and considered its possible effects on Disney World’s profits. This got us thinking — how might the Ozempic trend affect a mega fast-food chain’s profits, such as McDonald’s?

GLP-1, also known as Ozempic, has erupted onto the medical scene as a medication that can provide tremendous weight loss benefits. Originally designed to treat Type 2 diabetics who are at serious health risks without medication, this drug has also been prescribed to treat obesity.

Ozempic provides regulation of insulin and gastric emptying and can make users feel fuller for a longer period of time. With that in perspective, it’s totally possible that the food industry can be affected by this drug’s rise in popularity. In fact, market research firm Skift reported that “Ozempic prescriptions rose 300% between 2020 and 2022, and the market is projected to reach $100 billion in value by 2030.”

As data rolls in that PROVES people who use weight loss medication are cutting back on fast food, it’s fair to wonder if McDonald’s could suffer when it comes to profits.

It’s worth noting that McDonald’s’ latest earnings call featured the company boasting significant growth. McDonald’s reported chicken sales increasing, four new restaurants opening EVERY DAY in 2023, and 1,000 new restaurants opening in China this year. So far, the Ozempic trend hasn’t hampered McDonald’s’ growth.

That said, as the trend continues, McDonald’s could ultimately be affected. Let’s take a look at why the fast food giant’s profits could be hurt by the Ozempic trend and also why the company could be perfectly fine.

Reasons Why McDonald’s Could Lose Profits

For starters, if the Ozempic trend affects the fast food industry, it will certainly affect the king of fast food. People who take Ozempic still need to eat, so the food industry as a whole will never truly be in danger. However, meals and snacking may come more infrequently.

A study by The New York Times suggests that some doctors worry about malnutrition in extreme cases as a side effect and that’s something to monitor as the trend continues. The purpose of the drug is to quell appetite, and whether or not Ozempic has a major effect on the food industry, that’s not something food vendors want to hear.

With more than 90% of McDonald’s restaurants being operated as independent franchises, the company has been built upon the principle of expansion and a lack of demand would completely alter the McDonald’s business plan.

Ozempic not only curbs appetite, but it also has a reputation for stopping addiction. McDonald’s and other fast food chains that serve sugary drinks and food have built up brand loyalty and a lot of that consumer-restaurant relationship could be undone due to Ozempic’s ability to throw a wrench in daily habits. Of course, McDonald’s would hardly be the only brand affected by a potential change in consumer mentality, but when talking about the company’s future profits and stocks, this is definitely something to consider.

According to 24/7 Wall St. and Earnest Analytics, 10% of consumers account for 46% of Jack in the Box’s sales, 10% account for 43% of Chick-fil-A’s sales, and 10% account for 39% of Shake Shack’s sales. McDonald’s just like every other fast-food chain, banks on customer loyalty.

24/7 Wall St. wrote, “Morgan Stanley ran surveys of Americans taking anti-obesity drugs and found that 77% of them had cut back on fast food restaurants. With people taking anti-obesity drugs generally cutting their calorie intake by 20-30%, things like sugar drinks and items deemed less healthy (like fast food) are generally the first items cut.”

Assuming the Ozempic trend is just a small piece of the larger fitness trend, fast-food restaurants, in general, should be worried. Ever since 2004’s Super Size Me, McDonald’s and fitness go hand-in-hand like water and oil. To McDonald’s credit, the restaurant chain has made significant efforts to improve its menu and take health into consideration, but that doesn’t negate the fact that there are healthier options in the same space.

 Reasons Why McDonald’s Could Be Fine

Despite the market paying close attention to McDonald’s stocks during the rise of Ozempic, there are some indications that McDonald’s could thrive during the Ozempic trend.

Investors got a scare last fall when McDonald’s share price decreased by 13% on the New York Stock Exchange between September and October, but the company has slowly recovered despite worries about weight loss drug influences.

In fact, InvestorPlace reported that McDonald’s plans to open 10,000 new locations and add 100 million new members to its loyalty rewards program by 2027. It also reported a 58% increase in McDonald’s stock from 2018 through December 2023.

As we mentioned previously, McDonald’s has adjusted its menu before during times of controversy and heightened health efforts. In 2015, the company introduced healthier options, removed high-fructose corn syrup from the hamburger buns, and removed artificial preservatives from Chicken McNuggets. 

Starting in 2018, McDonald’s no longer serves artificial preservatives, flavors, and colorings from seven of its burgers aside from the pickles, which can be removed. McDonald’s took further strides in 2020 with the McPlant, a plant-based burger. With Beyond Meat alternatives becoming incredibly popular (at least stateside), McDonald’s will likely continue to venture down this path regarding its menu options.

If Ozempic really does prompt a change in the fast food industry, McDonald’s has already proven it can adapt to become healthier.

Ozempic stalls appetite but it does not remove the need to eat. Because of this, fast-food chains will always be in business, and the leader in fast food will likely always be McDonald’s. Mickey D’s is still the world leader in fast food and is consistently the most reliable option for food no matter where you go. As of January 16th, 2024, there are 13,530 McDonalds restaurants in the United States alone, per ScrapeHero.

If fast food does take a hit, other chains may suffer more than McDonald’s in the long run.

Finally, we’ve already seen McDonald’s adjust to possible profit loss. Just last year, McDonald’s started rolling out artificial intelligence hospitality options in lieu of a human workforce in addition to raising prices. If you live in California or plan on visiting Disneyland in Anaheim, you should also expect higher McDonald’s prices. As home to the most McDonald’s restaurants in America (and the first), California can be used to take the temperature of what the future might hold for the company. Per Yahoo!, McDonald’s used California’s latest wage-increase law to raise its menu prices.

According to Yahoo! and McDonald’s CEO Chris Kempczinski, the company believes the wage and menu price increases are a good thing for McDonald’s long-term, so this is something we could see expand across all of its locations.

At the moment, where the Ozempic trend goes is all purely speculative, both with us and the financial experts — but that doesn’t make it any less interesting to follow. We’ll continue to keep you posted with any updates so be sure to follow us here at DFB for all the latest!

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How do you think the fast food industry will be affected by the Ozempic trend? Share your thoughts in the comments below!