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Jun 30, 2025
Yum China Q2 2025 Earnings Report
Yum China reported strong second quarter 2025 results, with significant growth in operating profit and expanded margins, driven by positive same-store sales and continued store expansion.
Key Takeaways
Yum China delivered solid results in the second quarter of 2025, with total revenues increasing 4% year-over-year to $2.8 billion. Operating profit surged by 14% to a record $304 million, and diluted EPS rose by 5% to $0.58. The company achieved positive same-store sales growth and expanded its restaurant margin, reflecting effective cost management and strategic initiatives.
Total revenues increased 4% year-over-year to $2.8 billion.
Operating profit grew 14% year-over-year to a record $304 million, with OP margin expanding 100 basis points to 10.9%.
Diluted EPS increased 5% year-over-year to $0.58, or 15% excluding mark-to-market and F/X impact.
Restaurant margin expanded by 60 basis points to 16.1%, driven by savings in food and paper costs and occupancy expenses.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
Yum China targets opening approximately 1,600 to 1,800 net new stores in 2025, with an increased franchise mix. Capital expenditures for 2025 are revised down to $600 million to $700 million. The company plans to return $3 billion to shareholders in 2025 through 2026.
Positive Outlook
- Targeting 1,600 to 1,800 net new stores in 2025, indicating continued expansion.
- Increased franchise mix for new KFC (40-50%) and Pizza Hut (20-30%) stores, ahead of schedule.
- Revised down capital expenditures for 2025 to $600 million to $700 million, mainly due to lower capital expenditures per store.
- Commitment to return $3 billion to shareholders in 2025 through 2026, demonstrating strong shareholder value focus.
- Strong capital return in the first half of 2025, with $536 million returned through share repurchases and cash dividends.
Challenges Ahead
- No specific negative forward guidance points were explicitly stated in the provided text.
- No specific negative forward guidance points were explicitly stated in the provided text.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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