Yum Brands Reports Strong Q1 Results with Big Boost from Taco Bell

A recent Restaurant Dive article reports that Taco Bell had a strong start to 2025, with U.S. same-store sales growing 9% in the first quarter — the biggest jump it’s seen in a couple of years. According to the latest earnings report from parent company Yum! Brands, Taco Bell’s performance helped drive systemwide sales up by 5% and pushed operating profit to $586 million, an 8% increase from the previous year. Taco Bell alone now brings in about 80% of Yum’s U.S. profit.

“This quarter, Taco Bell saw a significant expansion in consumer penetration, reflecting our efforts to elevate our positioning and broaden our relevance, which helped us to grow traffic [in] low-single digits,” said CEO David Gibbs said on the earnings call.

Taco Bell’s success comes from a mix of smart pricing and new menu items. Popular additions like Crispy Chicken Nuggets, Steak and Queso Crunchwrap Sliders and Cheesy Dipping Burritos have kept customers coming back. Meanwhile, value deals like the $5 and $9 Luxe Cravings Boxes continue to be a hit, especially among budget-conscious diners.

Digital growth is another key focus. Taco Bell is expanding its loyalty program and digital ordering options, which Yum! estimates could add $225,000 in sales per store by 2030.

“Our connected brands strategy continues to leverage digital and technology across our system, strengthening operations, enhancing consumer experiences, and unlocking new insights,” wrote Christopher Turner, chief financial and franchise officer, in a LinkedIn post. “Yum’s digital sales are approaching $9 billion, with a digital mix of approximately 55%.”

While Taco Bell is thriving, Pizza Hut continues to struggle. U.S. same-store sales dropped 5% in the first quarter, and that weighed down Yum’s overall revenue. KFC also saw U.S. sales dip 1%. But Yum! is trying something new with KFC — a spin-off concept called Saucy by KFC. The pilot location, which focuses on chicken tenders, sauces and drinks, is already one of the top 15 performing KFCs in the country.

“Sales [at Saucy] are at more than double the U.S. system average,” said Gibbs. “We’re planning a phased expansion to at least 20 stores targeting sites that allow us to unlock marketing synergies through geographic proximity.”

Yum! is also continuing to invest in tech across all its brands. Its Byte by Yum! platform and other tools are being rolled out systemwide, with digital sales now making up more than half of the company’s total sales.

Read the full article here.

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