The results of Q1 2025 from Yum Brands revealed the company’s failure to meet revenue targets because Pizza Hut suffered a 2% decline in same-store sales.
The pizza chain Pizza Hut experienced a 2% decline in same-store sales which led to Yum Brands falling short of its revenue forecast during Q1 2025. The pizza chain’s performance in a tough economy prompted investors to reduce Yum Brands stock by more than 1% during premarket trading.
The company delivered adjusted earnings at $1.30 per share which exceeded LSEG predictions of $1.29 but generated revenue of $1.79 billion that failed to reach the $1.85 billion forecast. The company earned $253 million (90 cents per share) during the quarter but this amount dropped from $314 million ($1.10 per share) during the same period last year because of relocation expenses for KFC’s U.S. headquarters to Texas. The company generated a 12% increase in net sales which reached $1.79 billion while its same-store sales increased by 3% throughout its brands.
The U.S. sales of Pizza Hut experienced a 5% decline while international locations maintained flat sales performance which differed from StreetAccount’s predicted 0.1% decline. The U.S. market experienced weak sales during January according to CEO David Gibbs but sales picked up during March because of competitive market forces. Gibbs reported that Pizza Hut experienced a positive trend of sequential revenue along with transaction growth during the last several weeks. Despite Taco Bell’s success with 9% same-store sales growth above estimates the brand failed to recover its momentum.
The sales performance of Taco Bell demonstrated excellence by exceeding the estimated 8% growth with a 9% increase in same-store sales. Taco Bell’s new menu items including Steak and Queso Crunchwrap sliders and Crispy Chicken Nuggets increased customer visits in all revenue segments. The challenging market situation works in Taco Bell’s favor since the company maintains full operational strength according to Gibbs. The KFC sales performance featured 2% growth in same-store sales which surpassed the predicted 1.4% while Chinese system sales reached 3% although U.S. sales decreased by 1%. According to Circana’s 2025 sales data KFC now positions itself as the fifth-largest U.S. chicken chain after Wingstop and Raising Cane’s. The company appointed former KFC U.S. Chief Marketing Officer Catherine Tan-Gillespie to manage its domestic operations.
Sales through digital channels which include app and kiosk orders made up 55% of the total revenue. Yum Brands does not anticipate major supply chain problems due to President Trump’s tariffs and has not detected any negative American attitudes in its major markets including China. The company maintained its 2025 target of 8% core operating profit growth despite predicting reduced first-half profits because of specific expenses including a worldwide franchise conference. The current CEO Gibbs will retire in Q1 2026 but Yum Brands will select his successor through a board-led recruitment process as the company faces economic challenges together with growing market competition.
