Yum Brands is crashing
REUTERS/Joe Tan
Shares of the fast-food giant fell as much as 19% in after-hours trading Tuesday after the company reported earnings below expectations and cut its outlook.
Yum Brands is seen as a bellwether for the Chinese economy, given that about 54% of its sales were derived from the country.
"While it remains difficult to forecast China sales, we are now estimating full-year same-store sales to be low-single-digit negative," the fast-food giant said in its third-quarter earnings statement.
"The pace of recovery in our China Division is below our expectations," Yum Brands said.
CEO Greg Creed said the company faced more challenges than it had expected in the second half of the year in China. Still, same-store sales in China increased 2% and restaurant margins were 20%.
The company's restaurant chains include KFC, Taco Bell, and Pizza Hut. It reported adjusted earnings per share of $1, versus the estimate for $1.06 according to Bloomberg. Revenues came in at $3.43 billion, versus $3.67 expected.
The stock is up 14% year-to-date.
- Fresh photographs of Milky Way’s black hole Sgr A* reveal strong, twisted magnetic field similar to M87*
- 8 Lesser-known places to explore in Himachal Pradesh
- Markets end FY24 on buoyant note amid positive global cues
- SRM Contractors IPO allotment – How to check allotment, GMP, listing date and more
- Rupee falls 6 paise to settle at 83.39 against US dollar