Yum China (09987) announced its financial results for the fourth quarter and the full year of 2025. In the fourth quarter, system sales increased by 7% year-over-year, excluding the impact of foreign currency translation. Same-store sales grew by 3%, marking the third consecutive quarter of growth. Same-store transaction volume rose by 4%, achieving growth for the twelfth straight quarter. Total revenue climbed 9% to $2.8 billion, or 7% excluding foreign exchange effects. Operating profit surged 25% to $187 million. Core operating profit also saw a significant increase of 23%. Diluted earnings per share grew by 33% to $0.40. For the full year 2025, system sales increased by 4%, excluding foreign currency translation. Same-store sales rose by 1%. Total revenue reached $11.8 billion, a 4% increase, which was also 4% when excluding foreign exchange impacts. Operating profit grew by 11% to $1.3 billion. Core operating profit similarly increased by 11%. Net profit was $929 million, representing a 2% year-over-year increase. Diluted earnings per share advanced by 8% to $2.51.
Ms. Joey Wat, CEO of Yum China, commented, "Our fourth-quarter performance provided a strong finish to 2025. I extend my sincere thanks to our team for their dedication and hard work, which enabled us to achieve same-store sales growth for the third consecutive quarter and same-store transaction growth for the twelfth consecutive quarter. Fourth-quarter system sales further accelerated to 7%, with operating profit increasing by 25%. KFC has unlocked new consumption scenarios through its K Coffee and KPRO side-by-side models. Pizza Hut has enhanced its value proposition and successfully expanded into previously untapped regions, particularly lower-tier cities, through its WOW store model." Ms. Wat concluded, "Looking ahead, we will steadily progress towards our goal of exceeding 20,000 stores by 2026 through a combination of company-owned and franchise-operated models, with a plan to surpass 30,000 stores by 2030. Simultaneously, we are continuously expanding our potential addressable market through front-end segmentation and back-end aggregation. As outlined at our Investor Day, we will continue to execute our RGM 3.0 strategy, guided by a dual-driver approach of innovation and efficiency."
For the 2026 outlook, the company has set the following targets: a total store count exceeding 20,000, implying a net addition of over 1,900 new stores. Franchised stores are expected to account for 40% to 50% of the net new store additions for both KFC and Pizza Hut. Capital expenditures are projected to be between $600 million and $700 million. The company plans to return $1.5 billion to shareholders. Furthermore, Yum China was recognized as a "Top Employer in China" by the Top Employers Institute for the eighth consecutive year and ranked first in the restaurant industry for the fifth year in a row. These accolades underscore the company's steadfast commitment to fostering an exceptional workplace environment and optimizing the employee experience.
Comments