Burger King, KFC owners miss results estimates as fast-food spending wanes

(Reuters) -Burger King parent Restaurant Brands (NYSE:QSR ) and KFC owner Yum Brands missed market estimates for quarterly results on Tuesday, hit by weak demand in the United States and abroad from budget-stretched customers.

Consumers are relying on cheaper, home-cooked meals instead of eating out as fast-food prices have risen over the past year, hurting traffic across the industry.

As a result, restaurant operators have turned to aggressive promotions in an attempt to attract value-seeking customers. Burger King and KFC launched $5 value meals to get lower-income customers back into their outlets.

Still, Burger King sales declined 0.7% in the quarter ended Sept. 30, compared with a 6.6% rise last year. KFC's same-store sales in the U.S. tumbled 5%, marking the third straight quarter of declines this year.

The companies also joined burger giant McDonald's (NYSE:MCD ) in flagging weakness in international markets such as the Middle East.

Yum Brands, which also owns Pizza Hut and Taco Bell, saw worldwide same-store sales decline 2%, while Popeyes parent Restaurant Brands reported a comparable sales rise of only 1.8% for its international segment, compared with 7.7% last year.



Toronto, Canada-based Restaurant Brands earned 93 cents per share on an adjusted basis, missing analysts' estimates of 95 cents, according to data compiled by LSEG. Excluding items, Yum logged a profit of $1.37 per share, missing expectations of $1.41.

U.S.-listed shares of Restaurant Brands were down about 2% before the bell on Tuesday, while Yum was flat.

Source: Investing.com