Yum Brands earnings beat estimates, but cyclospora outbreak weighs on Taco Bell
Yum Brands reported third-quarter earnings of $1.56 EPS, exceeding analyst estimates of $1.47. Total revenue rose 3.8% year-over-year to $2.05 billion. While KFC growth and a Pizza Hut divestiture gain supported the bottom line, Taco Bell saw a 4% decline in same-store sales. This slump marks the chain's first quarterly decline since the pandemic and was driven by a cyclosporiasis outbreak linked to lettuce. Management reports that Taco Bell sales are now recovering in the U.S. following the summer parasite outbreak.
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- ✓ Yum Brands reported Q3 earnings per share of $1.56, beating the consensus estimate of $1.47.
- ✓ Quarterly revenue reached $2.05 billion, a 3.8% increase over the previous year.
- ✓ Taco Bell same-store sales fell 4%, the first quarterly drop for the brand since the pandemic.
- ✓ A cyclospora outbreak tied to lettuce served at Taco Bell restaurants reduced customer traffic.
What changed
Yum Brands released Q3 2026 financial results showing an earnings beat despite food safety pressures at Taco Bell.
Live updates
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Yum Brands Beats Q3 Estimates as KFC Offsets Taco Bell Sales Drop
Yum Brands reported third-quarter earnings of $1.56 EPS, exceeding analyst estimates of $1.47. Total revenue rose 3.8% year-over-year to $2.05 billion. While KFC growth and a Pizza Hut divestiture gain supported the bottom line, Taco Bell saw a 4% decline in same-store sales. This slump marks the chain's first quarterly decline since the pandemic and was driven by a cyclosporiasis outbreak linked to lettuce. Management reports that Taco Bell sales are now recovering in the U.S. following the summer parasite outbreak.
Why it matters
Cyclospora is a parasite that can cause gastrointestinal illness, often linked to contaminated produce. For Yum Brands, the impact on Taco Bell traffic tested the company's ability to maintain overall growth through its diversified portfolio of brands.
What is confirmed
- Yum Brands reported Q3 earnings per share of $1.56, beating the consensus estimate of $1.47.
- Quarterly revenue reached $2.05 billion, a 3.8% increase over the previous year.
- Taco Bell same-store sales fell 4%, the first quarterly drop for the brand since the pandemic.
- A cyclospora outbreak tied to lettuce served at Taco Bell restaurants reduced customer traffic.
- Taco Bell sales are recovering in the U.S. following the summer outbreak.
- KFC growth helped offset the sales decline at Taco Bell.
Still unconfirmed
- Yum Brands reported net income of US$1.623b for the quarter.
- Yum Brands had a negative return on equity of 24.57% and a net margin of 25.42%.
What to watch next
- Official confirmation of the full recovery of Taco Bell same-store sales in Q4.
- Performance metrics for the new KFC Muse flagship concept.
confidence 95%Sources used for this update (23)
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- CNBC — Yum Brands earnings beat estimates, but cyclospora outbreak weighs on Taco Bell
- Bloomberg — Taco Bell Sales Sank More Than Expected on Parasite Outbreak
- Kansas City Star — Taco Bell sales fall more than expected on cyclosporiasis outbreak hit
- Seeking Alpha — Yum! Brands reports Q3 results as KFC growth offsets Taco Bell sales decline (YUM:NYSE)
- 10TV — Yum: Q3 Earnings Snapshot
- WSJ — Yum Revenue Rises Despite Taco Bell Cyclospora Outbreak Fallout
- Quartz — Yum! Brands posted higher revenue despite Taco Bell's cyclospora slump
- Nation’s Restaurant News — Cyclospora outbreak weighed heavy on Taco Bell in Q3
- Newsday — Taco Bell sales recover in the US after summer cyclospora outbreak
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