Yum! Brands Stock Price Slides as Sales at Pizza Hut and KFC Fall
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Key Takeaways
Yum! Brands shares fell after the fast-food restaurant operator reported earnings and revenue that came in short of analysts’ expectations.
U.S. revenue at KFC slumped 8% and was down 6% at Pizza Hut.
Yum! Brands digital sales surpassed 50% for the first time ever.
Yum! Brands (
YUM
) shares lost ground after the fast-food restaurant operator reported weaker-than expected earnings as sales fell at its KFC and Pizza Hut locations.
The company reported first quarter adjusted earnings per share (EPS) of $1.15, as revenue fell 3% to $1.60 billion. Both were short of estimates.
Same-store sales
tumbled 3%, as Pizza Hut recorded a 7% decline and KFC registered a 2% decrease. Taco Bell same-store sales were up 1%.
Total U.S. revenue at KFC slumped 8%, and it slipped 6% at Pizza Hut. Both franchises also had a revenue drop in the Middle East, Turkey, North Africa market because of geopolitical tensions in the region, the company said.
Chief Executive Office David Gibbs said the company dealt with “a difficult operating environment.” He pointed to the gains made in digital sales, which he noted exceeded 50% for the first time ever.
Shares of Yum! Brands, which hit an all-time closing high on Monday, were down 4.5% at $134.93 at around 1:25 p.m. ET Wednesday.
