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Pizza Hut, KFC sales disappoint as Yum Brands earnings miss estimates

Yum Brands reported disappointing quarterly earnings and revenue, largely attributed to challenges faced by Pizza Hut and KFC in attracting customers. Pre-market trading saw a more than 4% decline in the company’s shares.

Here’s a breakdown of Yum’s performance compared to analysts’ expectations:

– Earnings per share: Adjusted at $1.15 versus the expected $1.20
– Revenue: $1.6 billion, falling short of the anticipated $1.71 billion

Yum recorded a first-quarter net income of $314 million, or $1.10 per share, up from $300 million, or $1.05 per share, from the previous year. Adjusted for investment losses and other factors, the company’s earnings were $1.15 per share.

Net sales experienced a 3% decrease to $1.6 billion. Furthermore, Yum’s global same-store sales fell 3% in the quarter, missing estimates of a 0.2% growth.

Among Yum’s major brands, only Taco Bell saw a rise in same-store sales, increasing by 1% during the quarter. However, KFC and Pizza Hut reported declines. KFC’s same-store sales fell by 2%, while Pizza Hut experienced a notable 7% drop.

Despite these challenges, Yum’s digital business showed promising growth, accounting for over 50% of sales for the first time. Additionally, the company expanded its global footprint by 6% in the quarter, with the opening of 808 new restaurants.

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