Yum Brands, parent company of Taco Bell, KFC, and Pizza Hut, reported a bigger-than-expected drop in same-store sales for the second quarter. The decline was attributed to sticky inflation and a shift towards home-cooked meals among budget-conscious consumers.
Despite the overall weakness, Taco Bell outperformed with a 5% increase in same-store sales. The growth was driven by new menu items like Cantina Chicken and the popular Taco Tuesday promotional event. KFC, on the other hand, continued to struggle, with US sales falling 5%.
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The company is facing fierce competition from other fast-food chains, engaging in a “value war” with discounted offers to combat rising menu prices. While inflation remains a concern, Yum Brands is optimistic about future growth, citing positive momentum exiting the quarter.