Subway Passes McDonald's

It's official: the Subway sandwich chain has surpassed McDonald's Corp. as the world's largest restaurant chain, in terms of units. At the end of last year, Subway had 33,749 restaurants worldwide, compared to McDonald's 32,737. The burger giant disclosed its year-end store count in a Securities and Exchange Commission filing late last month.

The race for global dominance is an important one for an industry that's mostly saturated in the U.S. High unemployment and economic uncertainty have battered the restaurant industry in the U.S., and chains are increasingly looking overseas for growth, particularly in Asia. Subway just opened its 1,000th location in Asia, including its first in Vietnam. Subway, which opened its first international restaurant in 1984, in Bahrain, expects its number of international restaurants to exceed its domestic ones by 2020, says Don Fertman, Subway's Chief Development Officer. The chain currently has just over 24,000 restaurants in the U.S., where it generated $10.5 billion of its $15.2 billion in revenue last year.

McDonald's is still the leader when it comes to sales. The burger chain reported $24 billion in revenue last year. "We remain focused on listening to and serving our customers, and are committed to being better, not just bigger," a McDonald's spokeswoman says. Subway, which surpassed the number of McDonald's in the U.S. about nine years ago, expects China to eventually become one of its largest markets. The sandwich shop only has 199 restaurants in China now, but expects to have more than 500 by 2015.