Yum! Third-Quarter GAAP EPS Rises to $5.92 on Pizza Hut Sale Gain

The Tip Desk · November 3, 2026 · 3 min read

Third-quarter revenue rose 4% to $2.054 billion. GAAP EPS was $5.92 after a $1.7 billion pre-tax gain on the Pizza Hut sales, while EPS excluding Special Items was $1.56.

Yum! Brands, Inc. (YUM) reported third-quarter revenue of $2.054 billion, up 4%, and recorded a pre-tax gain of approximately $1.7 billion on the completed Pizza Hut sales, lifting GAAP diluted earnings to $5.92 a share from $1.41 a year earlier.

The restaurant company closed the sale of Pizza Hut in mainland China to Yum China on August 7 and the rest of the brand to LongRange Capital on September 1, after entering definitive agreements on June 16. Chief Executive Chris Turner said the company had entered its next chapter of growth with a sharper focus on Raise the B.A.R. priorities.

GAAP operating profit rose 248% to $2.317 billion. Core operating profit, which excludes Special Items and foreign currency, declined 4% to $654 million. EPS excluding Special Items was $1.56, down 1% from $1.58 a year earlier.

Worldwide system sales excluding foreign currency slowed to 3% in the third quarter from 5% in the second quarter, after 6% in the first quarter. Same-store sales excluding foreign currency turned even after +3% in each of the two prior quarters. Excluding Pizza Hut, unit count rose 7%, including 955 gross new units.

KFC, the larger of the remaining divisions, posted 7% unit growth, matching the second and first quarters, and opened 878 gross new restaurants across 66 countries. System sales excluding foreign currency were up 6%. Same-store sales excluding foreign currency slowed to +1% from +2% in the second and first quarters.

KFC operating profit excluding foreign currency rose 8%. Operating margin was 44.8%, up 0.7 percentage points. Company-owned restaurant margins were 12.3%, down 140 basis points, which the company said was driven primarily by 15 lower-margin stores tested under the Saucy brand.

Taco Bell reversed course. Same-store sales excluding foreign currency fell 4% after +7% in the second quarter and +8% in the first. System sales excluding foreign currency declined 2%. Operating profit excluding foreign currency fell 4% after 19% growth in the second quarter. Operating margin contracted 3.5 percentage points to 33.1%.

Taco Bell U.S. system sales declined 3% and same-store sales declined 4%. U.S. company-owned restaurant margins were 20.5%. Taco Bell International system sales excluding foreign currency grew 14% and same-store sales grew 5%. The division opened 73 gross new restaurants across 16 countries. Unit growth held at 3%.

Habit Burger & Grill opened four restaurants. System sales grew 3% and same-store sales were flat.

Excluding Pizza Hut, digital system sales exceeded $9 billion, with digital mix reaching 64%. Foreign currency translation favorably impacted divisional operating profit by $7 million.

Year to date, GAAP EPS was $10.51. Core operating profit excluding Pizza Hut from both 2026 and 2025 grew 6% for the year to date. The company returned $1.8 billion to shareholders through dividends and share repurchases year-to-date. Cash and cash equivalents were $2.108 billion at September 30.

The company targets 5% unit growth, 7% system sales growth excluding foreign currency, and at least 8% core operating profit growth over an extended period. Turner said that since the end of September, Taco Bell U.S. has been outpacing the QSR industry on same-store sales growth, and that Taco Bell will continue building on that momentum with differentiated value and innovation.