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Taco Bell parent Yum Brands misses estimates as spending slows, costs rise
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Taco Bell parent Yum Brands misses estimates as spending slows, costs rise
Aug 5, 2025 4:28 AM

Aug 5 (Reuters) - Yum Brands ( YUM ) missed analysts'

estimates for second-quarter comparable sales and profit on

Tuesday, hit by higher ingredient costs and muted demand that

weighed on its businesses, including Taco Bell.

Concerns over the impact of steep tariffs and economic

growth have dented U.S. consumer spending on eating out,

prompting fast-food chains, including Yum Brands ( YUM ), McDonald's

and Burger King-owner Restaurant Brands, to

launch budget-friendly meal deals to boost foot traffic.

Taco Bell, which accounts for 38% of the company's total

revenue, rolled out meal boxes ranging from $5 to $9. Still, its

same-store sales growth in the U.S. - the biggest market -

slowed to 4% during the second quarter from 5% a year earlier.

Among other restaurant chains, Chipotle Mexican Grill ( CMG )

cut its annual sales growth forecast and missed

quarterly sales estimates on weak demand. Burger giant

McDonald's, which is set to report on Wednesday, warned of tough

conditions in May owing to tariff uncertainty.

The Trump administration's unpredictable trade policies have

also made it harder for businesses to plan operations, disrupted

supply chains and increased costs.

Yum's worldwide same-store sales rose 2% during the quarter

ended June 30, below analysts' average estimate of a 2.37%

increase, according to data compiled by LSEG.

Total costs and expenses for the quarter were up 13%.

Revenue was at $1.93 billion during the quarter, compared

with the estimate of $1.94 billion.

Excluding items, the company earned $1.44 per share, while

analysts estimated $1.46 per share.

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