Yum China (YUMC) Q2 2025 earnings summary

Executive summary

• Achieved record highs in revenue, operating profit, and operating margin for Q2 2025, with total revenues up 4% year-over-year to $2.79 billion and operating profit rising 14% to $304 million; net income increased 1% to $215 million.

• System Sales Growth reached 4% year-over-year, with Same-Store Sales Growth turning positive at 1% in Q2; total restaurant count reached 16,978 as of June 30, 2025.

• Opened 336 net new stores in Q2, with KFC and Pizza Hut expanding into hundreds of new cities and total store count up 10% year-over-year.

• Digital and delivery sales remained strong, with delivery sales up 22% year-over-year to 45% of total sales and digital sales exceeding $5 billion, representing up to 94% of total orders.

• Diluted EPS was $0.58, up 5% year-over-year, or 15% excluding mark-to-market and F/X impacts.

Financial highlights

• Q2 2025 revenues: $2.79B (+4% year-over-year); operating profit: $304M (+14% year-over-year); net income: $215M (+1% year-over-year); restaurant margin: 16.1% (up 60 bps); OP margin: 10.9% (up 100 bps).

• Diluted EPS for Q2 2025 was $0.58, up 5% year-over-year.

• Returned $274 million to shareholders in Q2 via $184 million in share repurchases and $90 million in dividends; $536 million returned in H1 2025.

• Cash flows from operations increased to $864M for H1 2025, supporting expansion and shareholder returns.

• Restaurant margin for KFC reached 16.9%, Pizza Hut at 13.3%.

Outlook and guidance

• Reiterated full-year targets for 1,600–1,800 net new store openings and mid-single-digit System Sales Growth.

• CapEx guidance revised down to $600–$700 million for 2025, focused on store expansion, digitalization, and infrastructure.

• Plans to return at least $1.2 billion to shareholders in 2025 and $3 billion in 2025–2026.

• Franchise mix of new stores expected to further increase, with 40–50% for KFC and 20–30% for Pizza Hut.

• Targeting 20,000 stores by 2026, with significant capital returns planned.