McDonald’s is flipping the script on its recent sales slump with a move that’s sure to spark joy—and maybe ignite a collecting frenzy. In a bid to boost sales, the Golden Arches is tapping into its toy chest of nostalgia, bringing back Happy Meals featuring the viral Squishmallow toys that once took the internet by storm.
McDonald’s Banks on Nostalgia and TikTok Hype with Squishmallow Happy Meal Toys
While assuring investors of their commitment to “value and affordability” as a key strategy to regain customer traction, McDonald’s is also strategically leveraging nostalgia and viral trends to boost its bottom line.
The fast-food giant has recently announced the nationwide return of Happy Meals featuring the highly sought-after Squishmallow toys, available for a limited time. These plush collectibles surged in popularity during the 2020 COVID-19 pandemic, fueled in part by their viral success on TikTok, leading to rapid sell-outs at major retailers like Walgreens and Walmart.
McDonald’s previously featured Squishmallows in their Happy Meals in 2023, and this time, they’re upping the ante. Customers ordering the Happy Meal will have the opportunity to snag a “never-before-seen” Squishmallow character.
As stated in a press release, “Inside each Happy Meal box, you will find your classic McDonald’s order of choice, along with one of 12 adorable Squishmallows, including a never-before-seen Intergalactic Axolotl named Halley. Each Squishmallows comes with a character hang tag, telling you the name and a little about each Squish, plus a code to scan and immerse yourself in an interactive game.”
According to a recent report from Today, this popular Squishmallow Happy Meal will be available on menus until June 9th.
As noted by TheStreet, the renewed excitement is already evident, with complete sets of the Squishmallows from this promotion already commanding prices between $50 and $85 on eBay. Furthermore, McDonald’s customers are actively sharing their experiences with the Squishmallow Happy Meal on TikTok.
McDonald’s Faces Steepest Sales Decline Since the Pandemic
Earlier this month, McDonald’s reported a 3.6% drop in U.S. same-store sales—a sharp decline that marks the company’s worst quarterly performance since the COVID-19 pandemic, when sales plunged by 8.7%. The dip caught many off guard, as analysts surveyed by StreetAccount had only projected a 1.7% decrease for the quarter.
The fast-food chain attributed the downturn to a mix of severe weather and mounting economic anxiety. As fears grow over tariffs potentially driving inflation or tipping the economy into recession, McDonald’s has observed a notable decline in customer traffic. That trend is now spreading beyond its core low-income customer base to include middle-income diners, who are also feeling the pressure.
CEO Chris Kempczinski addressed these concerns during a May 1st earnings call, stating that consumers are increasingly “weighed down by the cumulative impact of inflation and heightened anxiety.”
“We remain cautious about the overall health of the consumer,” Kempczinski added.
In response, McDonald’s is ramping up its value-focused strategy. The company is doubling down on its McValue menu and plans to extend the popular $5 Meal Deal through 2025—an effort to maintain appeal amid rising inflation and high interest rates. To further entice customers, McDonald’s is also enhancing its menu with the permanent return of beloved Chicken Strips and exploring new beverage offerings inspired by its CosMc’s concept stores, which serve flavored coffees and energy drinks.
On the growth front, McDonald’s is forging ahead with expansion plans, aiming to open 2,200 new locations this year. The company disclosed in a regulatory filing that it expects to invest between $3 billion and $3.2 billion in capital expenditures to boost system-wide sales growth by 2%.