Yum Brands announced its quarterly earnings on Wednesday, revealing mixed results that reflected a significant decline in same-store sales for Pizza Hut.
The company’s stock saw a slight decline of less than 1% in premarket trading following the announcement.
Yum’s first-quarter performance compared to analysts’ expectations as gathered by LSEG is summarized below:
- Earnings per share: $1.30 adjusted vs. $1.29 anticipated
- Revenue: $1.79 billion vs. $1.85 billion projected
The company’s net income for the first quarter was reported at $253 million, equivalent to 90 cents per share, marking a decrease from $314 million, or $1.10 per share, in the same period last year.
When adjusted for expenses related to relocating KFC’s headquarters to Texas and other costs, Yum reported earnings of $1.30 per share.
Total net sales experienced a year-on-year growth of 12%, reaching $1.79 billion. Overall, same-store sales across all of Yum’s brands rose by 3%.
However, Pizza Hut continued to face challenges this quarter. The chain reported a 2% decline in same-store sales, significantly worse than the anticipated drop of 0.1% based on StreetAccount estimates. In the U.S., Pizza Hut’s same-store sales fell by 5%, while its international markets remained flat.
On a brighter note, Taco Bell emerged as a strong performer within Yum’s brand portfolio, achieving same-store sales growth of 9%, surpassing the expected 8% increase.
KFC also saw a rise in same-store sales by 2%, exceeding projections of 1.4%. Notably, the majority of KFC’s revenue comes from international markets, with system sales growth of 3% reported in China, the chain’s largest market.
Digital transactions, which include orders made through mobile applications and in-store kiosks, accounted for 55% of Yum’s total sales in this quarter.
On another note, CEO David Gibbs announced his intention to retire by the first quarter of 2026, prompting the company’s board to initiate a search for his successor.
