McDonald's Is Using AI to Recommend Menu Prices at Nearly 14,000 Stores
A Reuters investigation published Tuesday set off a fast food controversy: McDonald's has been using a machine-learning AI system to generate what it calls "the optimal price" for every menu item at nearly 14,000 restaurants across the US and in some global markets. The AI analyzes millions of daily transactions and estimates each location's customers' "willingness to pay."
McDonald's responded quickly. And firmly.
"AI does not set the price of a Big Mac or any other menu item," the company said in a statement. "The pricing portal is a tool, not a mandate, designed to provide restaurant-specific recommendations."
The chain said that franchisees set their own prices and that the AI system merely offers suggestions — suggestions that operators are free to follow or ignore.
Five franchisees told Reuters a different version of that story. They said the company pressured them to use the AI pricing tools.
What the Numbers Actually Show
A price check Reuters conducted on the McDonald's app in September found a 21% gap between two company-run McDonald's locations in Fresno, California — not even franchise-owned stores, but corporate locations. Same sandwich, two miles apart: one Big Mac at $5.69, the other at $6.89.
McDonald's did not specifically address why two corporate-owned stores in the same city have that gap, or whether the AI system generated those particular prices.
The company has used some version of an AI pricing tool since at least 2019. The current platform is run by Tiger Analytics, according to two former Tiger employees who spoke to Reuters. McDonald's has a close working relationship with Tiger Analytics in shaping the AI's recommendations, according to those sources.
The Distinction McDonald's Is Drawing
McDonald's position hinges on a technically meaningful distinction: the AI recommends prices, it doesn't impose them. Franchisees retain the legal right to set their own menu prices under the franchise agreement.
But the gap between "recommends" and "mandates" gets complicated when five franchise owners say they felt pressured to follow those recommendations. A suggestion from corporate headquarters isn't the same as a menu item recommendation from a friend.
McDonald's is also navigating this issue at a delicate moment. US foot traffic has declined year-over-year in every complete month since March, according to Placer.ai data. Customers pushed back hard after a $18 Big Mac meal in Connecticut went viral in 2024. The company has been actively trying to project a message of value and affordability — including a $5 meal deal and moves toward more consistent pricing across locations — while simultaneously operating an AI system designed to charge each market whatever it will bear.
The tension between those two things is the story underneath this story.
Why It Matters Beyond McDonald's
AI-driven dynamic pricing — adjusting what you charge based on demand signals, location data, and willingness to pay — is spreading across industries. Airlines have done it for decades. Hotels do it. Uber does it in real time. The question regulators and consumer advocates are increasingly asking is whether restaurants doing it constitutes price manipulation that disadvantages certain communities or demographics.
Consumer protection staff at the Federal Trade Commission have been examining how companies use personal data to set individualized prices. McDonald's is not the only fast food chain building these tools, but it's the largest one — and the Reuters investigation puts the practice squarely in the public conversation in a way it hasn't been before.
For now, the answer McDonald's is giving is: the AI advises, humans decide. Five of those humans say that's not quite how it works in practice.
Curious for more stories that keep you informed and entertained? From the latest headlines to everyday insights, YourLifeBuzz has more to explore. Dive into what’s next.