Results
Yum China Reports Third Quarter 2026 Results
Grew Revenue 8%, Operating Profit 13% and Diluted EPS 20%
15th Consecutive Quarter of Same-Store Transaction Growth; Year-over-Year Expansion in Both Restaurant and OP Margins
7Achieved Record Net New Store Openings in the First Nine Months, Raising 2026 Full-Year Target to Over 2,400
On Track to Return $1.5 Billion to Shareholders in 2026, ~10% of Current Market Capitalization
Shanghai, China (November 3, 2026) – Yum China Holdings, Inc. (the “Company” or “Yum China”) (NYSE: YUMC and HKEX: 9987) today reported unaudited results for the third quarter ended September 30, 2026.
Third Quarter Highlights
Total system sales grew 3% year over year (“YoY”), excluding foreign currency translation (“F/X”).
1Same-store sales reached 97% of the prior year’s level.
Same-store transactions grew 3% YoY, the 15 th consecutive quarter of growth.
Total revenues increased 8% YoY to $3.5 billion, or a 2% increase excluding F/X.
Opened 692 net new stores , a quarterly record high, with 44% opened by franchisees.
As of September 30, 2026, total store count reached 19,989, with 19% of stores operated by franchisees.
Operating profit grew 13% YoY to $451 million.
Core operating profit grew 6% YoY.
OP margin was 13.0%, an increase of 50 basis points YoY, the 10 th consecutive quarter of OP margin expansion.
Restaurant margin was 17.8%, an increase of 50 basis points YoY, supported by streamlined operations and favorable commodity prices, which more than offset the impact of value-for-money offerings, sales deleveraging and increased rider cost from a higher delivery mix.
Pizza Hut license fee savings also contributed to margin expansion.
Diluted EPS increased 20% YoY to $0.91, or up 12% excluding F/X, and up 8% further excluding the impact 1 of mark-to-market equity investments.
Returned $362 million to shareholders in the third quarter through $263 million in share repurchases and $99 million in cash dividends .
In the first nine months of 2026, the Company returned $1,080 million to shareholders.
Delivery sales grew 7% YoY.
Delivery contributed approximately 54% of total Company sales, up from 51% in the same quarter last year and the same as the prior quarter.
Active Members of KFC or Pizza Hut, defined as those who transacted in the past 12 months, exceeded 278 million, representing a 6% YoY increase.
Completed the acquisition of the Pizza Hut brand in Mainland China on August 7, 2026.
CEO Comments
Joey Wat, CEO of Yum China, commented, “ We delivered year-over-year growth in system sales, operating profit and OP margin for the 10th consecutive quarter, despite a dynamic operating environment.
Importantly, our diluted EPS has grown by double digits year-to-date and in each of the past three years, excluding the impact of mark-to-market equity investments and foreign exchange.
These results demonstrate the resilience of our business model, disciplined execution, and our commitment to delivering sustainable value to shareholders.
Same-store sales faced pressure from tough comparisons against last year’s delivery platform subsidies and adverse weather in August.
We captured incremental demand across a broader range of consumption occasions such as smaller orders and solo dining, and grew same-store transactions for the 15th consecutive quarter.
6To pursue significant opportunities in China, we accelerated store openings across Company-owned and franchise stores, leveraging our tailored store formats and menus and keeping us on track to surpass 20,500 stores this year. ”
Wat continued, “We continue to build our brand and attract more customers to our stores through compelling in-store-only offers and experience, and greater takeaway convenience.
Dine-in and takeaway performance improved sequentially, bucking the previous trend.
Meanwhile, our side-by-side modules, which target new occasions and drive incremental sales and profit, maintained strong momentum and hit key milestones.
2KCOFFEE cafes crossed 4,000 locations, KPRO exceeded 700 locations, and Pizza Hut’s Burger Bar surpassed 300 locations.
We are also expanding car-side pickup to drive takeaway, now covering over 9,000 KFC locations.
As for our core menu, we continue to innovate around hero products to drive repeat purchases and attract new customers.
Together, these growth drivers reinforce our confidence in sustainable growth.
Looking ahead, on a three-year basis, we remain committed to the growth algorithm we outlined at our Investor Day.”
81 Refers to a 6-cent favorable F/X impact in this quarter and a mark-to-market loss of 2 cents in the third quarter of 2025.
Key Financial Results
2 System sales and same-store sales percentages exclude the impact of F/X. Effective January 1, 2018, temporary store closures are normalized in the same-store sales calculation by excluding the period during which stores are temporarily closed.
3 See “Reconciliation of Reported GAAP Results to Non-GAAP Measures” included in the accompanying tables of this release for further details.
4 Core operating profit is defined as operating profit adjusted for special items, further excluding items affecting comparability and the impact of F/X. The Company uses core operating profit for the purposes of evaluating the performance of its core operations.
Current period amounts are derived by translating results at average exchange rates of the prior year period.
5 OP margin refers to operating profit as a percentage of total revenues.
6 Core OP margin refers to core operating profit as a percentage of total revenues excluding F/X.
Note : All comparisons are versus the same period a year ago.
Percentages may not recompute due to rounding.
NM refers to not meaningful.
Capital Returns to Shareholders
The Company is on track to return $1.5 billion each year from 2024 to 2026, which is annually around 10% of Yum China’s market capitalization as of October 30, 2026.
In the first nine months of 2026, the Company returned $1,080 million in capital to shareholders through $778 million in share repurchases and $302 million in cash dividends.
3In November 2026, Yum China’s board of directors (the "Board") increased the Company's share repurchase authorization by $1 billion.
With the increased authorization, approximately $1.3 billion remained available for future share repurchases.
The Board declared a cash dividend of $0.29 per share on Yum China’s common stock, payable on December 22, 2026, to shareholders of record as of the close of business on December 1, 2026.
Starting in 2027, the Company plans to return approximately 100% of annual free cash flow after subsidiaries ’ dividend payments to non-controlling interests.
This is anticipated to translate into an average annual return of approximately $900 million to over $1 billion in 2027 and 2028, and to exceed $1 billion in 2028.
KFC
System sales for KFC grew 3% YoY.
Same-store sales reached 97% of the prior year’s level.
Same-store transactions grew 3% YoY, driven in part by incremental smaller orders from new customer segments and occasions such as KCOFFEE and KPRO.
Ticket average was 5% lower YoY.
Delivery sales grew 7% YoY, contributing approximately 54% of KFC’s Company sales, up from 51% in the same quarter last year and the same as the prior quarter.
KFC opened 518 net new stores during the quarter, including 269 opened by franchisees, representing 52% of net new store openings.
Total store count reached 14,307 as of September 30, 2026, with 18% of stores operated by franchisees.
Operating profit grew 10% YoY to $425 million, a record third-quarter level.
Core operating profit increased 4% YoY.
OP margin was 16.3%, an increase of 30 basis points YoY.
Restaurant margin was 18.6%, an increase of 10 basis points YoY, primarily due to streamlined operations and favorable commodity prices, partially offset by the impact of value-for-money offerings, sales deleveraging, and increased rider cost resulting from a higher delivery mix.
Pizza Hut
System sales for Pizza Hut grew 1% YoY.
4Same-store sales reached 97% of the prior year’s level.
Same-store transactions grew 5% YoY, marking the 15 th consecutive quarter of growth.
In line with Pizza Hut’s mass-market strategy, ticket average moved closer to the target range, primarily driven by value-for-money offerings and incremental smaller orders such as those from solo diners.
Delivery sales grew 8% YoY, contributing approximately 53% of Pizza Hut’s Company sales, up from 48% in the same quarter last year and slightly up from 52% in the prior quarter.
Pizza Hut opened 191 net new stores during the quarter, including 91 opened by franchisees, representing 48% of net new store openings.
Total store count reached 4,740 as of September 30, 2026, with 13% of stores operated by franchisees.
Operating profit grew 29% YoY to $73 million.
Core operating profit increased 21% YoY.
5OP margin was 11.0%, expanding 210 bps YoY, supported by savings from Pizza Hut license fees previously payable to Yum!
Brands.
Restaurant margin was 15.3%, an increase of 190 basis points YoY, primarily due to streamlined operations, automation, savings from Pizza Hut license fees and favorable commodity prices, partially offset by the impact of value-for-money offerings, increased costs associated with a higher delivery sales mix and sales deleveraging.
2026 Outlook
The Company targets:
Total stores of over 20,500, or more than 2,400 net new stores.
40-50% franchise mix of net new stores for both KFC and Pizza Hut.
Capital expenditures of approximately $600 million to $700 million.
$1.5 billion capital return to shareholders.
Note on Non-GAAP Measures
Reported GAAP results include items that are excluded from non-GAAP measures.
See “Reconciliation of Reported GAAP Results to Non-GAAP Measures” and “Segment Results” within this release for non-GAAP reconciliation details.
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Earnings release and accompanying slides will be available at the Company’s Investor Relations website http://ir.yumchina.com .
For important news and information regarding Yum China, including our filings with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange, visit Yum China’s Investor Relations website at http://ir.yumchina.com .
Yum China uses this website as a primary channel for disclosing key information to its investors, some of which may contain material and previously non-public information.
These statements are based on current estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate and reasonable under the circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct.
We cannot assure you that any of our expectations, estimates or assumptions will be achieved.
You should consult our filings with the Securities and Exchange Commission (including the information set forth under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q) for additional detail about factors that could affect our financial and other results.
Yum China is the largest restaurant company in China with a mission to make every life taste beautiful.
The Company operates over 19,000 restaurants under six brands across over 2,800 cities in China.
KFC and Pizza Hut are the leading brands in the quick-service and casual dining restaurant spaces in China, respectively.
The Pizza Hut brand in Mainland China is owned by Yum China.
In addition, Yum China has also partnered with Lavazza to develop the Lavazza coffee concept in China.
Little Sheep and Huang Ji Huang specialize in Chinese cuisine.
Taco Bell offers innovative Mexican-inspired food.
Yum China has a world-class, digitalized supply chain which includes an extensive network of logistics centers nationwide and an in-house supply chain management system.
Its strong digital capabilities and loyalty program enable the Company to reach customers faster and serve them better.
Yum China is a Fortune 500 company with the vision to be the world's most innovative pioneer in the restaurant industry.
For more information, please visit http://ir.yumchina.com .
Yum China Holdings, Inc.
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