Yum! Brands Inc (NYSE:YUM) posted stronger-than-expected first-quarter earnings Wednesday, driven by an exceptional performance from Taco Bell that helped offset more modest contributions from its other restaurant chains.
The Louisville-based fast food operator reported adjusted earnings per share of $1.50, surpassing analyst estimates of $1.38.
Revenue came in at $2.06 billion, edging past the $2.04 billion consensus forecast.
Taco Bell was the standout performer, posting 8% same-store sales growth and 10% system sales growth in the US, which the company attributed to the chain's value meal offerings and a steady flow of new menu items drawing customers back to the drive-thru.
"We delivered solid topline momentum to start the year, with our fundamentals as strong as ever," CEO Chris Turner said in a statement.
Taco Bell posted 8% same-store sales growth, which Turner noted is ahead of the broader quick-service restaurant industry.
KFC continued to lead the company's international expansion, adding 648 new units in the quarter. Yum! Brands opened 1,030 restaurants worldwide in total during the period. Consolidated core operating profit reached $612 million, while KFC operating profit came in at $383 million with a 43.6% operating margin.
The company said it is maintaining its long-term growth targets, including 5% unit growth, 7% system sales growth, and core operating profit growth of 8% or more.
Shares of Yum! Brands rose 2.5% in Wednesday morning trading.