KFC: Nearly 30% digital sales increase Q2

Throughout the past several quarters, Taco Bell has hogged the spotlight for Yum Brands’ earnings results. That spotlight in Q2, however, belonged to KFC.

On August 2nd, Yum reported a 9% increase in same-store sales on the quarter – nearly 2% higher than analysts’ expectations. Global sales jumped 13%, with KFC up 19%, and both Taco Bell and Pizza Hut up 7%. Comp sales increased 13% at KFC, 4% at Taco Bell, and 4% at Pizza Hut. Habit Burger Grill, the newest and smallest chain in the company’s portfolio, increased system sales by 9% with flat same-store sales.

Much of KFC’s performance came from a recovering China business, though the U.S. market was up 5% driven by “a combination of product innovation and always-on value strategy,” CEO David Gibbs said during the earnings call Wednesday morning. KFC’s nuggets launch in late March generated transaction growth, with 100 million sold in the first eight weeks. Gibbs said the product also appealed to younger and new customers and built upon an already established sales layer from the chain’s sandwich launch in 2021.

Yum’s recommended ordering system, an AI/machine learning module that predicts how much food a GM should order, was deployed to 800 stores in the second quarter, and is now live in over 4,400 KFC and Taco Bell U.S. stores. And, Yum’s next gen point-of-sale system, which Turner said improves operational efficiencies and enhances team member effectiveness, was deployed to 1,000 Taco Bells in the quarter, with a 5,000-unit target by the end of the year.

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