I don’t know about the fast food spots in your neck of the woods, but near me I notice way less business than I did a few years ago. In fact, there’s a Burger King I speed by almost every day and I swear the parking lot looks the same as it did during the pandemic. Something’s gotta give. 

On that note, Let me delve into what’s going on with Yum Brands, the fast-food empire behind KFC, Pizza Hut, and Taco Bell. In this trio, Taco Bell seems to be the straight A student, while Pizza Hut and KFC are flunking out of school.

See, Yum Brands recently gave us a peek behind the curtain with their second-quarter earnings report. They came out with a mixed bag. Earnings per share? Nailed it at $1.35 adjusted versus the $1.33 Wall Street had penciled in. Revenue, however, took a bit of a crapper, landing at $1.76 billion instead of the expected $1.8 billion.

KFC and Pizza Hut, bless their hearts, didn't quite hit the mark. Both chains saw their sales shrink faster than portions at Chipotle. KFC's U.S. outlets were particularly hard-hit, with sales dropping 5%. Even though Colonel Sanders had some luck in China, his overall international sales fell by 3%. Pizza Hut saw a 1% dip in the U.S. and a 4% decline internationally. 

(Source: WSJ)

David Gibbs, Yum's head honcho, blamed a combo of the Middle East conflict and penny-pinching consumers for these stumbles. But he did toss us a bone, saying that things were looking a tad brighter in the U.S., thanks to deals like Pizza Hut's $7 Deal Lovers. Apparently, even in tough times, folks can't resist a cheap pizza.

Now, let's talk about Taco Bell, the golden child of Yum Brands. This chain isn't just holding its own; it's thriving. Taco Bell's sales shot up 5%, proving that their value meals are the secret to surviving a consumer spending slump. CEO David Gibbs was practically high-fiving himself, noting that Taco Bell's sales growth was across all income levels. Seems like everyone, from college students to CEOs, is craving a Crunchwrap Supreme.

(Source: CNN)

On another positive note, in a move that screams "the future is now," Yum announced they're rolling out artificial intelligence across Taco Bell drive-thru lanes. By the end of the year, hundreds of U.S. Taco Bells will be equipped with AI, making ordering your late-night 5 layer burrito even smoother.

(Source: SpiceWorks)

But not everything is hot sauce and happy customers. Over 200 Yum restaurants are temporarily closed in the Middle East, Malaysia, and Indonesia, caught in the crossfire of regional conflicts. CFO Chris Turner admitted some might not reopen if things get worse. It's a sobering reminder that even global fast-food empires aren't invincible.

Ultimately, Taco Bell is the overachieving sibling in this dysfunctional family, but overall Yum Brands stock finds itself up nearly 8% over the last year. So, while the others are finding their way, Taco Bell will need to keep working overtime. 

Stocks.News holds positions in Chipotle and Yum Brands.