Yum! Brands reports 5% growth in global system sales for Q1 2025

GLOBAL – Yum! Brands has announced a 5% increase in worldwide system sales for the first quarter of fiscal year 2025, ended 31 March, excluding the impact of foreign currency translation.

Yum! Brands posted strong growth in the latest quarter, primarily driven by an 11% increase in Taco Bell’s sales and a 5% rise for KFC.

The company also expanded its global footprint, reporting a 3% increase in unit count with 751 new stores opened during the period.

Digital sales remained a significant contributor to overall performance, nearing US$9 billion and accounting for 55% of total sales.

Despite the overall positive performance, the company faced an US$11 million unfavourable impact on divisional operating profit due to foreign currency translation.

The KFC division led the expansion efforts, adding 528 new restaurants across 52 countries.

However, company-owned restaurant margins were slightly affected by the previously acquired KFC UK stores in Q2 2024. These margins were lower during Q1, attributed to seasonal effects and additional maintenance costs.

Taco Bell also reported substantial progress, opening 24 new restaurants across eight countries.

In the United States, Taco Bell’s system sales climbed 11%, while international system sales, excluding the effects of currency fluctuations, rose by 8%. Same-store sales improved by 9% in the US and 3% in international markets.

Yum! Brands indicated that Taco Bell’s future strategy will centre on increasing digital engagement and strengthening value-oriented offerings. CEO David Gibbs noted that Taco Bell would focus on expanding loyalty memberships and enhancing digital channels.

This strategy, he said, could generate an additional US$225,000 per store in sales by 2030, representing a 10% boost in unit volumes.

He also attributed part of Taco Bell’s recent momentum to a series of limited-time offerings and new menu additions such as Crispy Chicken Nuggets, Milk Bar Churros, Cheesy Dipping Burritos, and Steak and Queso Crunchwrap Sliders.

Meanwhile, the Pizza Hut division continued to expand with the opening of 198 new restaurants across 34 countries.

However, its operating profit growth was dampened by costs linked to the transfer of four franchise entities to new ownership and the timing of investments in advertising and technology services.

The Habit Burger & Grill division reported flat system sales for the quarter, with only one new restaurant opened. Same-store sales declined by 3%, indicating challenges in that segment.

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