Yum! Brands reported second-quarter results on Thursday that topped profit expectations but fell short on revenue, and offered no commentary on the damage a cyclospora outbreak has inflicted on Taco Bell sales since mid-July.
The company posted adjusted earnings per share of $1.62 for the quarter ended June 30, beating the $1.58 consensus estimate, according to CNBC. Net revenue climbed 12% to $2.17 billion, missing analyst expectations of $2.2 billion.
Net income for the quarter totaled $853 million, or $3.08 per diluted share, a sharp improvement from $374 million, or $1.33 per diluted share, in the year-ago period. The adjusted figure excluded charges tied to the company's strategic review of Pizza Hut and other items.
Taco Bell led Yum's brand portfolio, posting a 7% gain in same-store sales alongside 9% U.S. system sales growth. KFC posted same-store sales growth of 2%, with its China business — its largest market — recording 6% system sales growth. Pizza Hut same-store sales fell 1%.
Because the reporting period ended June 30, the figures predate the crisis that emerged after federal health regulators traced a cyclospora outbreak to iceberg lettuce at Taco Bell in mid-July, according to CNBC. Foot traffic at Taco Bell restaurants has fallen by double-digit percentages in the weeks since the outbreak came to light, which cited Placer.ai data. Yum's forward-looking risk disclosures referenced "the impact of the July 2026 cyclospora outbreak" and "the impact of such outbreak on sales and pace of recovery" among factors that could cause actual results to differ from expectations.
Yum announced in June that it would sell Pizza Hut for $2.7 billion in two separate transactions. Private equity firm LongRange Capital is paying $1.5 billion for Pizza Hut's international operations outside mainland China, while Yum China is acquiring the mainland China piece for $1.2 billion. The deals are expected to close in the third quarter, subject to regulatory approval. Once the sales close, Yum will operate only Taco Bell and KFC.
Pizza Hut's operating profit fell 12% in the quarter to $70 million. The company recorded $44 million in charges during the quarter related to the strategic review process.
Yum also said it reached separate definitive agreements with two buyers for the Pizza Hut business during the quarter, calling the outcome the strongest path to maximize shareholder value. CEO Chris Turner said in a statement that Yum would "enter its next chapter as a more focused organization."
Yum held an earnings conference call Thursday morning, and analysts were widely expected to press executives on the traffic decline at Taco Bell and its potential effect on future results. Yum does not provide outlook guidance for same-store sales or earnings per share.