McDonald's CEO Chris Kempczinski said Friday that the company suspended its buyback program several weeks ago.
"Really, for us, we just wanted to maintain maximum flexibility as we went into this crisis and be as nimble as we needed to," Kempczinski told CNBC's Carl Quintanilla on "Closing Bell."
In 2019, the fast-food giant spent $5 billion repurchasing 25 million shares, according to its annual regulatory filing. In December, the company's board authorized the repurchase of $15 billion in outstanding stock with no expiration date.
Buybacks have come under scrutiny as industries ask for financial assistance from the government to weather the coronavirus pandemic. President Donald Trump has said that he will not oppose a ban on future buybacks if companies receive aid from the federal government.
Kempczinski said that McDonald's would not make any changes to its quarterly cash dividend of $1.25, calling it a "priority."
"We have the best balance sheet in the industry," he said.
Only 50 out of 14,000 McDonald's U.S. locations have closed due to the pandemic. Substantially all restaurants have closed their dining rooms, serving customers only through drive-thru, takeout and delivery options.
Roughly 95% of McDonald's restaurants in the United States are operated by franchisees. Kempczinski said that franchisees are working with lenders to restructure loans, and suppliers are extending payment terms. The company is offering deferrals on service fees and rent in some situations, he said. McDonald's franchisees pay rent to the company based on a percentage of their sales.
"Our rent also goes down as any sales go down," Kempczsinki said.
Shares of McDonald's closed down less than 1% at $148.49 on Friday. The company's stock, which has a market value of $116 billion, has fallen nearly 24% so far in 2020.