Yum says Taco Bell rebounding after cyclosporiasis outbreak hit Q3 sales
YUM•Taco Bell same-store sales fell 4% in the third quarter after the outbreak hurt traffic, but have risen about 1% so far this quarter. Yum’s overall same-store sales were flat, while adjusted earnings per share of $1.56 topped estimates of $1.49.
1. Taco Bell sales recover
Yum Brands said Taco Bell same-store sales were recovering after the chain’s first decline in about six years, as a multistate cyclosporiasis outbreak hurt third-quarter traffic. Sales fell 4%, compared with analysts’ expectations for a 0.9% decline, but have risen about 1% so far this quarter.
2. Promotions draw customers
Executives said value deals, loyalty-program promotions and partnerships were helping bring customers back. CEO Chris Turner said returning customers were “actually spending 5% more and visiting 6% more frequently than the consumers we lost.” The outbreak was linked to Taco Bell in early July and reduced weekly foot traffic by 20% at its peak; health authorities declared it over last month.
3. Yum results mixed
Yum’s overall same-store sales were flat, below estimates for 0.9% growth. KFC same-store sales rose 1%, missing expectations for 2.1% growth. Adjusted earnings per share fell 1.3% to $1.56, beating estimates of $1.49.
