Yum! Brands (YUM) investor relations material

Executive summary

• Entered definitive agreements to sell Pizza Hut, expected to close August 2026, with anticipated net proceeds of $2.3 billion and a potential $75 million earn-out by 2030.

• System sales grew 7% year-over-year excluding Pizza Hut, with KFC (+6%) and Taco Bell (+10%) divisions leading growth, while Pizza Hut declined 1%.

• Net income for Q2 2026 was $853 million, up 128% year-over-year, driven by a significant $359 million tax benefit related to the Pizza Hut sale.

• Diluted EPS for Q2 2026 was $3.08, up 131% year-over-year; EPS excluding special items grew 12% to $1.62.

• Digital sales excluding Pizza Hut exceeded $17 billion in the first half, up 25% year-over-year.

Financial highlights

• Total revenues for Q2 2026 were $2.17 billion, up 12% year-over-year; year-to-date revenues reached $4.23 billion, up 14%.

• Operating profit for Q2 2026 was $655 million, up 5% year-over-year; Core Operating Profit up 5% to $683 million.

• Company restaurant margin for Q2 2026 was 16.3%, flat year-over-year.

• Taco Bell U.S. restaurant-level margins expanded by 170 basis points to 26.2% year-over-year.

• Cash provided by operating activities was $923 million for the first half of 2026, up from $850 million in 2025.

Outlook and guidance

• Guidance for full-year performance remains confident, with long-term targets of 5% unit growth, 7% system sales growth (ex-F/X), and at least 8% Core Operating Profit growth.

• Taco Bell U.S. Q3 same-store sales growth is -2% quarter-to-date due to a recent industry-wide food safety issue, but steady improvement is observed.

• Taco Bell's Q3 equity store-level margins are expected to range between 19% and 21%.

• Proceeds from the Pizza Hut sale will be used to pay down revolving credit facility and fund share repurchases.

• Expect to maintain a net leverage ratio of approximately 4.0x EBITDA over the medium term.