FILE PHOTO: People walk by a Taco Bell and Pizza Hut, subsidiaries of Yum! Brands, Inc. in Manhattan, New York City
(Reuters) -Yum Brands Inc beat Wall Street estimates for quarterly comparable sales on Wednesday, as its value-oriented offerings at KFC and Taco Bell pulled in more inflation-weary consumers.
Fast food chains have been hiking menu prices to keep up with surging commodity and labor costs, but meals at KFC and Taco Bell are still more affordable than eating out at dine-in restaurants keeping demand resilient.
Last week, McDonald’s Corp also beat quarterly comparable sales and profit estimates helped by an increase in restaurant traffic owing to value-oriented offerings.
Restaurant sales saw an uptick in the third quarter after a slowdown in June, as gas prices eased from peaks.
Yum, which also owns the Pizza Hut chain, said comparable sales rose 5% in the third quarter, compared to analysts’ average estimate of a 3.2% increase, according to IBES data from Refinitiv.
Same-store sales at KFC restaurants rose 7%, while sales rose 6% at Taco Bell in the quarter.
Excluding one-time items, Yum Brands earned $1.09 per share, missing estimates of $1.14 per share, with the company blaming the hit from a stronger dollar and a loss in profits from the exit of its KFC business in Russia.
(Reporting by Mehr Bedi and Uday Sampath in Bengaluru; Editing by Shailesh Kuber)