Yum China shares dip as same-store sales growth slows

Investing.com -- Yum China Holdings Inc (NYSE: YUMC) on Tuesday reported third-quarter earnings that slightly exceeded analyst expectations, but shares fell 1.09% as same-store sales growth slowed to just 1% YoY.

The company delivered strong operating profit growth of 8% YoY to $400 million, supported by margin expansion despite challenging market conditions.

For the quarter ended September 30, 2025, Yum China posted adjusted earnings per share of $0.76, narrowly beating the analyst consensus of $0.75.

Revenue increased 4% YoY to $3.21 billion, slightly above expectations of $3.2 billion. System sales grew 4% YoY, driven primarily by 4% net new unit contribution while same-store sales growth contributed just 1%.

"We delivered another solid quarter in a dynamic market – accelerating store openings, achieving positive same-store sales growth, and expanding margins," said Joey Wat, CEO of Yum China. "Delivering across all three dimensions was no easy task. It reflected the effectiveness of our dual focus on innovation and operational efficiency."

The company continued its aggressive expansion, opening 536 net new stores during the quarter, bringing its total store count to 17,514. KFC, the company’s largest brand, opened a third-quarter record of 402 net new stores, while Pizza Hut surpassed the 4,000-store milestone.

Restaurant margin improved to 17.3%, up 30 basis points YoY, driven primarily by savings in food and paper costs along with occupancy and other operating expenses. The company’s digital strategy continued to show strength, with digital sales reaching $2.8 billion, accounting for approximately 95% of total company sales.

Yum China maintained its target of opening 1,600-1,800 net new stores in 2025 and remains on track to return approximately $1.5 billion to shareholders this year through dividends and share repurchases. In the third quarter alone, the company returned $414 million to shareholders.

The Board declared a quarterly cash dividend of $0.24 per share, payable on December 23, 2025, to shareholders of record as of December 2, 2025.

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