Yum Brands reported third-quarter earnings that surpassed Wall Street expectations, with adjusted earnings per share of $1.56 compared to the anticipated $1.49, and revenue matching the forecast at $2.05 billion. The company posted a net income of $1.62 billion, or $5.92 per share, a significant rise from $397 million, or $1.41 per share, a year earlier. This quarter also marked Yum's completion of its divestiture of Pizza Hut, including the sale of its mainland China business to Yum China in August and the remaining Pizza Hut operations to LongRange Capital in September.

Despite the overall positive financial results, Taco Bell experienced a decline in same-store sales by 4%, heavily impacted by a cyclospora outbreak linked to iceberg lettuce served at its restaurants. This health scare temporarily depressed customer traffic, especially during the weekend of July 18. However, Yum Brands CEO Chris Turner highlighted Taco Bell’s recovery, noting that since the end of September, the brand has outperformed the quick-service restaurant industry in same-store sales growth, and the company’s CFO Ranjith Roy reported a 1% sales increase so far in the fourth quarter.

Yum attributes Taco Bell's rebound to factors including targeted loyalty promotions like weekly Tuesday deals for members and partnerships with popular figures such as Olivia Rodrigo, who featured in a campaign for a pink-colored Mountain Dew Baja Blast. While “heavy” customers have returned to normal traffic levels, visits from casual diners are gradually recovering. Outside the U.S., Taco Bell's smaller international segment posted a 5% increase in same-store sales, contributing positively to the brand’s growth momentum.

KFC's same-store sales also saw a modest increase of 1%, driven by stronger performance in China and Europe, though U.S. sales slipped by 6% amid heightened competition and shifting consumer preferences. KFC's launch of limited-time items like popcorn chicken helped spur demand but did not fully offset last year’s successful promotions. Yum Brands aims to position KFC as the leading modern chicken quick-service restaurant by rolling out new promotions, updating its brand identity, and expanding its menu with upgraded items and beverages.