McDonald’s is closing all five remaining locations of its beverage-focused spinoff, CosMc’s, by the end of June 2025. Launched in December 2023, CosMc’s was designed as a drive-thru and pickup-only concept offering space-themed drinks and snacks to compete with brands like Starbucks and Dutch Bros. Despite initial enthusiasm, the chain failed to meet sales expectations, leading to its discontinuation.
The closures will affect sites in Texas, particularly in San Antonio and Fort Worth, and one in Illinois. McDonald’s executives praised the CosMc’s initiative as a valuable platform for experimenting with bold flavors and new technologies. They indicated that popular offerings from CosMc’s could soon make their way into standard McDonald’s locations.
The decision to shut down CosMc’s comes amidst a period of declining sales for McDonald’s, with the company recently reporting its second consecutive quarter of diminished revenues due to customer cutbacks in spending.
While CosMc’s is closing, McDonald’s plans to integrate some of its popular drinks into the main menu at existing U.S. restaurants, beginning with an in-store test later this year.
The CosMc’s app and loyalty program will be discontinued by June 23, 2025. Customers are advised to redeem any remaining points before that date.
McDonald’s CEO Chris Kempczinski stated that the pilot provided valuable insights into consumer preferences, particularly in beverage customization. Rather than continue with CosMc’s as a separate brand, McDonald’s will now integrate its specialty drinks into menus at existing U.S. restaurants.
McDonald’s has been making headlines around the world recently due to a series of controversies and business challenges that have impacted its reputation, operations, and profits.
One of the most significant issues stems from the Israel-Gaza conflict. In late 2023, McDonald’s Israeli franchise donated thousands of free meals to Israeli soldiers, sparking outrage across many Muslim-majority countries. This act was widely perceived as taking sides in a deeply sensitive geopolitical issue. As a result, widespread boycotts of McDonald’s broke out in countries like Kuwait, Malaysia, Pakistan, and Indonesia. The backlash reportedly caused the fast-food giant to lose over $7 billion in revenue. In an attempt to recover from the damage, McDonald’s announced in 2024 that it would buy back its Israeli restaurants, effectively ending its franchising partnership in the region.
In the UK, McDonald’s is under scrutiny for two very different reasons. First, the introduction of McDonald’s home delivery service in towns like Louth, Lincolnshire, has led to complaints from local businesses. Independent restaurant owners claim the fast-food giant is pushing them out by offering cheap, convenient meals, with some reporting revenue drops of up to 75%. Many fear that McDonald’s dominance could permanently damage local food economies.
Secondly, McDonald’s UK is facing serious legal troubles. Over 700 workers, many of them young employees, have filed complaints of workplace misconduct. These allegations include sexual harassment, racism, and homophobic behavior across more than 450 McDonald’s locations. Although the company has fired at least 29 workers and set up a special investigation unit, critics say more needs to be done to protect employees and change the company’s internal culture.
To offset declining sales and public image issues, McDonald’s is also rolling out new value-based promotions. In the U.S., it has extended its popular $5 Meal Deal and introduced a “McValue” menu that includes “Buy One, Add One for $1” deals. These initiatives aim to retain customers who are cutting back due to inflation and economic uncertainty.
Altogether, McDonald’s is navigating a perfect storm of global boycotts, local backlash, employee unrest, and financial pressure—all while trying to maintain its position as a leader in the fast-food industry.
In summary, McDonald’s is closing all CosMc’s locations due to underwhelming performance but plans to incorporate successful elements of the concept into its core operations.
