Yum Manufacturers (YUM) earnings Q2 2024

Yum Manufacturers on Tuesday reported a blended quarter as each Pizza Hut and KFC reported declining same-store gross sales.

“The impacts from the Center East battle, along with a extra cost-conscious shopper, have introduced headwinds to same-store gross sales,” Yum CEO David Gibbs advised analysts on the corporate’s convention name.

He added that gross sales traits have improved within the U.S. in contrast with the prior quarter, due to worth meals resembling Pizza Hut’s $7 Deal Lovers.

Here is what the corporate reported in contrast with what Wall Road was anticipating, primarily based on a survey of analysts by LSEG:

• Earnings per share: $1.35 adjusted vs. $1.33 anticipated
• Income: $1.76 billion vs. $1.8 billion anticipated

Yum reported second-quarter internet earnings of $367 million, or $1.28 per share, down from $418 million, or $1.46 per share, a 12 months earlier.

Excluding objects, the corporate earned $1.35 per share.

Web gross sales rose 4% to $1.76 billion, fueled by new restaurant openings. Yum’s same-store gross sales fell 1% within the quarter as each Pizza Hut and KFC reported same-store gross sales declines of three%.

KFC’s U.S. eating places continued to battle, with home same-store gross sales shrinking 5%. And though the rooster chain’s system gross sales picked up this quarter in China, its largest market, KFC’s general worldwide same-store gross sales fell 3%.

Pizza Hut’s U.S. same-store gross sales decreased 1%, whereas its worldwide same-store gross sales declined 4%.

Taco Bell, the crown jewel of Yum’s portfolio, noticed its same-store gross sales enhance 5% within the quarter. The chain’s footprint is basically concentrated within the U.S., the place its fame for worth has helped it climate the pullback in shopper spending. Taco Bell’s same-store gross sales grew throughout all earnings cohorts, Gibbs mentioned.

On Wednesday, Yum introduced plans to increase its rollout of synthetic intelligence throughout Taco Bell drive-thru lanes to a whole lot of its U.S. eating places by the tip of the 12 months.

Roughly 200 of Yum’s eating places are briefly closed throughout the Center East, Malaysia and Indonesia, based on Chief Monetary Officer Chris Turner. A few of these places could reopen as quickly as later this month, however he acknowledged the chance that some may shut completely if the battle worsens.