Yum Brands’ Performance Falls Short of Expectations: KFC, Taco Bell, and Pizza Hut Miss Sales Targets

Yum Brands’ Performance Falls Short of Expectations: KFC, Taco Bell, and Pizza Hut Miss Sales Targets

On Wednesday, Yum Brands announced its quarterly earnings and revenue, which didn’t meet the predictions made by experts. This was due to lower than anticipated sales at KFC, Taco Bell, and Pizza Hut.

Yum is the third major global restaurant company to report lower than expected revenue for the final quarter of 2023. Both Starbucks and McDonald’s also failed to meet Wall Street’s predictions, pointing to the Israel-Hamas conflict as one of the challenges they faced.

Yum’s shares dropped by more than 1% in premarket trading.

Here’s a comparison of what Yum Brands reported and what was expected by Wall Street, based on a survey of analysts by LSEG, previously known as Refinitiv:

  • Earnings per share: Adjusted $1.26 vs. Expected $1.40
  • Revenue: $2.04 billion vs. Expected $2.11 billion

Yum reported a net income of $463 million, or $1.62 per share, for the fourth quarter, up from $371 million, or $1.29 per share, from the same period last year.

When excluding certain items, the restaurant giant earned $1.26 per share. The company stated that changes in its quarterly tax rate reduced its earnings by 23 cents per share.

Net sales increased by 1% to $2.04 billion. The company’s global same-store sales also saw a 1% increase.

Pizza Hut’s same-store sales decreased by 2%, falling short of the expected growth of 0.6%. The pizza chain’s U.S. same-store sales decreased by 4%, while its international same-store sales remained the same.

KFC’s same-store sales increased by 2%, which was less than the 4.7% predicted by StreetAccount.

Taco Bell, often considered the star of Yum’s portfolio, also didn’t meet Wall Street’s expectations. The chain, known for its Mexican-inspired menu, reported a same-store sales growth of 3%, missing the 3.8% predicted by StreetAccount. The previous year, the chain reported a same-store sales growth of 11%, boosted by the return of its popular Mexican Pizza.

In 2024, Yum plans to reach several significant milestones in its global presence. According to a statement by CEO David Gibbs, Yum’s presence will exceed 60,000 locations, including more than 30,000 KFC restaurants and over 20,000 Pizza Hut locations.

KFC and Taco Bell restaurants along 118th Avenue in Edmonton, on January 21, 2024, in Edmonton, Alberta, Canada. Image Credit: Artur Widak | Nurphoto | Getty Images

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top