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YUM! Brands Q2 Earnings Miss, Revenues Beat Estimates, Stock Down
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Key Takeaways
{\"0\":\"YUM posted Q2 EPS of $1.44, missing estimates by a cent, though revenues beat at $1.933 billion.\",\"1\":\"Taco Bell and KFC boosted global system sales by 4%, offsetting Pizza Hut\'s 1% decline.\",\"2\":\"Operating margins fell across all segments, with the steepest drop of 580 bps at Pizza Hut.\"}
YUM! Brands, Inc. (YUM - Free Report) reported second-quarter 2025 results, with earnings missing the Zacks Consensus Estimate but revenues beating the same. Earnings missed the consensus estimate after beating it in the preceding two quarters.
Following the results, shares of the company declined 1.6% in the pre-market trading session today.
YUM’s Q2 Earnings and Revenue Discussion
In second-quarter 2025, the company's adjusted earnings per share (EPS) were $1.44, missing the Zacks Consensus Estimate of $1.45. However, the metric increased 7% from the prior-year quarter.
Quarterly revenues of $1,933 million beat the consensus mark of $1,930 million. Moreover, the top line increased 10% year over year.
Worldwide system sales, excluding foreign currency translation, increased 4% year over year, with Taco Bell rising 6% and KFC 5%. The metric declined 1% year over year at Pizza Hut.
Yum! Brands, Inc. Price, Consensus and EPS Surprise
YUM! Brands primarily announces results under four divisions — KFC, Pizza Hut, Taco Bell and Habit Burger Grill.
For second-quarter 2025, revenues from KFC totaled $849 million, up 19% from the prior-year quarter. Our model predicted the metric to increase 11.2% year over year. Comps in the division rose 2% against a decline of 3% reported in the prior-year quarter.
The segment's operating margin contracted 360 basis points (bps) year over year to 43%. In the quarter under review, KFC Division opened 566 gross new restaurants across 58 countries.
At Pizza Hut, revenues amounted to $239 million, flat year over year. Our model predicted Pizza Hut revenues to increase 1.8% year over year. Comps in the quarter decreased 1% compared with a decline of 3% in the year-ago quarter.
The segment's operating margin decreased 580 bps year over year to 33.5%. Pizza Hut Division opened 254 gross new restaurants.
Taco Bell's revenues were $711 million, up 7% from the year-ago quarter's levels. Our model predicted the metric to increase 7.3% year over year. Comps in the segment increased 4% compared with 5% growth reported in the prior-year quarter. Its operating margin contracted 70 bps year over year to 36.8%.
Taco Bell opened 50 gross new restaurants in the quarter under review.
In the second quarter, the Habit Burger Grill division’s revenues amounted to $134 million, down 5% year over year. Our model predicted the metric to increase 16.3% year over year. Comps in the division declined 4% year over year. In the quarter under review, the division opened one gross new restaurant.
Other Financial Details of YUM’s Q2 Earnings
As of June 30, 2025, cash and cash equivalents totaled $677 million compared with $616 million at 2024-end. Long-term debt, as of June 30, 2025, was $10,418 million compared with $11,306 million at 2024-end.
YUM’s Long-Term Growth Targets
The company has outlined its long-term growth framework, initially introduced in 2022, aiming to deliver consistent performance over time. It is targeting approximately 5% annual unit growth and expects system sales to rise around 7% each year, excluding the impact of foreign exchange fluctuations and the occasional 53rd week. Additionally, it is committed to achieving at least 8% annual growth in core operating profit, also on a constant currency basis and adjusted for the 53rd week.
Cracker Barrel has gained 24.4% in the year-to-date period. The Zacks Consensus Estimate for Cracker Barrel’s fiscal 2026 sales and EPS indicates growth of 1.8% and 9.4%, respectively, from the year-ago period’s levels.
BJ's Restaurants presently carries a Zacks Rank #1. The stock has gained 16.5% in the past year.
The Zacks Consensus Estimate for BJ's Restaurants’ 2025 sales and EPS indicate an increase of 3.2% and 38.8%, respectively, from the year-ago levels.
Yum China presently carries a Zacks Rank #2. The stock has gained 5.2% in the past six months.
The Zacks Consensus Estimate for Yum China's 2025 sales and EPS implies growth of 2.8% and 6.9%, respectively, from the year-ago levels.
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YUM! Brands Q2 Earnings Miss, Revenues Beat Estimates, Stock Down
Key Takeaways
YUM! Brands, Inc. (YUM - Free Report) reported second-quarter 2025 results, with earnings missing the Zacks Consensus Estimate but revenues beating the same. Earnings missed the consensus estimate after beating it in the preceding two quarters.
Following the results, shares of the company declined 1.6% in the pre-market trading session today.
YUM’s Q2 Earnings and Revenue Discussion
In second-quarter 2025, the company's adjusted earnings per share (EPS) were $1.44, missing the Zacks Consensus Estimate of $1.45. However, the metric increased 7% from the prior-year quarter.
Quarterly revenues of $1,933 million beat the consensus mark of $1,930 million. Moreover, the top line increased 10% year over year.
Worldwide system sales, excluding foreign currency translation, increased 4% year over year, with Taco Bell rising 6% and KFC 5%. The metric declined 1% year over year at Pizza Hut.
Yum! Brands, Inc. Price, Consensus and EPS Surprise
Yum! Brands, Inc. price-consensus-eps-surprise-chart | Yum! Brands, Inc. Quote
Divisional Performance of YUM in Q2
YUM! Brands primarily announces results under four divisions — KFC, Pizza Hut, Taco Bell and Habit Burger Grill.
For second-quarter 2025, revenues from KFC totaled $849 million, up 19% from the prior-year quarter. Our model predicted the metric to increase 11.2% year over year. Comps in the division rose 2% against a decline of 3% reported in the prior-year quarter.
The segment's operating margin contracted 360 basis points (bps) year over year to 43%. In the quarter under review, KFC Division opened 566 gross new restaurants across 58 countries.
At Pizza Hut, revenues amounted to $239 million, flat year over year. Our model predicted Pizza Hut revenues to increase 1.8% year over year. Comps in the quarter decreased 1% compared with a decline of 3% in the year-ago quarter.
The segment's operating margin decreased 580 bps year over year to 33.5%. Pizza Hut Division opened 254 gross new restaurants.
Taco Bell's revenues were $711 million, up 7% from the year-ago quarter's levels. Our model predicted the metric to increase 7.3% year over year. Comps in the segment increased 4% compared with 5% growth reported in the prior-year quarter. Its operating margin contracted 70 bps year over year to 36.8%.
Taco Bell opened 50 gross new restaurants in the quarter under review.
In the second quarter, the Habit Burger Grill division’s revenues amounted to $134 million, down 5% year over year. Our model predicted the metric to increase 16.3% year over year. Comps in the division declined 4% year over year. In the quarter under review, the division opened one gross new restaurant.
Other Financial Details of YUM’s Q2 Earnings
As of June 30, 2025, cash and cash equivalents totaled $677 million compared with $616 million at 2024-end. Long-term debt, as of June 30, 2025, was $10,418 million compared with $11,306 million at 2024-end.
YUM’s Long-Term Growth Targets
The company has outlined its long-term growth framework, initially introduced in 2022, aiming to deliver consistent performance over time. It is targeting approximately 5% annual unit growth and expects system sales to rise around 7% each year, excluding the impact of foreign exchange fluctuations and the occasional 53rd week. Additionally, it is committed to achieving at least 8% annual growth in core operating profit, also on a constant currency basis and adjusted for the 53rd week.
YUM’s Zacks Rank & Other Key Picks
YUM currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the Zacks Retail – Restaurants industry are Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) , BJ's Restaurants, Inc. (BJRI - Free Report) and Yum China Holdings, Inc. (YUMC - Free Report) .
Cracker Barrel currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cracker Barrel has gained 24.4% in the year-to-date period. The Zacks Consensus Estimate for Cracker Barrel’s fiscal 2026 sales and EPS indicates growth of 1.8% and 9.4%, respectively, from the year-ago period’s levels.
BJ's Restaurants presently carries a Zacks Rank #1. The stock has gained 16.5% in the past year.
The Zacks Consensus Estimate for BJ's Restaurants’ 2025 sales and EPS indicate an increase of 3.2% and 38.8%, respectively, from the year-ago levels.
Yum China presently carries a Zacks Rank #2. The stock has gained 5.2% in the past six months.
The Zacks Consensus Estimate for Yum China's 2025 sales and EPS implies growth of 2.8% and 6.9%, respectively, from the year-ago levels.