Yum Brands Tops Adjusted EPS Estimates as Taco Bell Same-Store Sales Fall 4%

Yum Brands delivered adjusted third-quarter earnings above analyst estimates, while Taco Bell's same-store sales fell 4% as an outbreak linked to iceberg lettuce reduced customer visits.

Adjusted earnings per share were $1.56, compared with the $1.49 analysts expected. Revenue reached $2.05 billion, in line with expectations and up 4% from a year earlier.

Taco Bell customers temporarily made fewer visits during the outbreak. The chain's international same-store sales grew 5%. Across Yum's businesses, same-store sales were flat after excluding Pizza Hut, while KFC's same-store sales increased 1%.

Yum's net income totaled $1.62 billion, or $5.92 per share, compared with $397 million, or $1.41 per share, a year earlier. Adjusted earnings exclude gains from the Pizza Hut divestiture and other items.

Yum's results included Pizza Hut through the closing of its mainland China sale to Yum China on Aug. 7 and the sale of the remaining business to LongRange Capital on Sept. 1.

CEO Chris Turner described an improvement in Taco Bell's U.S. sales trends. “Since the end of September, Taco Bell U.S. has been outpacing the [quick-service restaurant] industry on same-store sales growth,” he said.