USA—Multinational fast food corporation Yum! Brands reported a 12% decline in net income from US$418 million in Q2 2023 to US$367 million in Q2 2024, a testament to the challenging market environment QSR brands are facing worldwide.
However, revenues increased by 4% in the reported quarter to US$1.76 billion. Consolidated sales also increased by 12% to US$572 million. Operating profits also increased by 6% to US$607 million compared to US$573 million in the same quarter last year.
Global system sales increased by 3% in Q2 2024, while same-store sales decreased by 1% in the reported quarter.
Property and franchise revenues remained relatively stable in the reported quarter, slightly improving to US$789 million from the US$785 million reported in the same quarter last year.
The company’s KFC division reported an 8% increase in outlet count and a 3% increase in operating profit to US$ 334 million for the reported quarter.
The fast food corporation’s Pizza Hut wing saw a 3% increase in outlet count. However, it reported a 2% system sales decline and a corresponding 2% operating profit decline on a year-to-date basis.
Habit Burger Grill opened four new outlets in the reported quarter but reported a 1% system sales decline and a 6% decline in same-store sales.
Overall, Yum! Brands recorded a 5% increase in outlet count, with 894 new outlets opened in Q2 2024 across brands.
Yum! Brands recorded a 1% increase in revenues in H1 2024 to US$3.361 billion. However, this revenue increase was offset by a 7% increase in total expenses and costs. This caused a 5% decline in H1 2024 net income to US$681 million in the first half of the year.
The mixed half-year performance is attributed to the inflation-burdened market environment, which has caused a significant increase in raw material and ingredient costs while stifling demand.
In its future outlook, Yum! Brands revealed plans to invest in technology and digital transformation.
“Based on our first-half results, we expect to deliver at least 8% core operating profit growth this year,” David Gibbs, Yum! Brands CEO, said.
“Meanwhile, as we progress into the next phase of our technology and digital journey, we are laying the groundwork for another promising year in 2025, as evidenced by the expansion of drive-through voice AI technology at Taco Bell.”
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