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Wendys Q3 adjusted revenue misses estimates, hurt by weaker US demand

By Reuters News


Overview

  • U.S. fast-food chain's Q3 adjusted revenue missed analyst expectations

  • Adjusted EPS for Q3 beat analyst expectations

  • Global systemwide sales fell 5.9%, led by a 7.6% U.S. decline


Outlook

  • Wendys is implementing Daves Way, a multi-year strategy to grow traffic and market share

  • Company expects breakfast strategy changes could unlock up to $200 mln in EBITDA

  • Company plans restaurant acquisitions and franchise transfers to strengthen franchisee economics


Result Drivers

  • U.S. SALES DECLINE - Co said lower U.S. same-restaurant sales and fewer U.S. restaurants drove global sales decrease

  • LOWER ROYALTY REVENUE - Co attributed revenue decline mainly to lower franchise royalty revenue, partly offset by higher advertising funds revenue and more company-operated restaurant sales

  • MARGIN PRESSURE - Co said U.S. restaurant margin fell due to lower traffic, higher labor and commodity costs, partly offset by higher average check and labor efficiencies


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

$547 mln

Q3 Adjusted Revenue

Miss

$435.60 mln

$530.52 mln (15 Analysts)

Q3 Adjusted EPS

Beat

$0.13

$0.09 (21 Analysts)

Q3 EPS

$0.08

Q3 Adjusted EBITDA

Beat

$113.40 mln

$100.22 mln (18 Analysts)


Reuters Recommended Reads

  • Nov 4 - McDonald's says US sales on the mend as promotions draw diners back

  • Nov 3 - Yum says Taco Bell rebounding after cyclosporiasis outbreak hit Q3 sales

  • Nov 4 - Applebee's owner Dine Brands beats Q3 sales estimates on value, menu innovation


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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