Will Yum! Brands' (YUM) Q2 Revenue Growth Offset Ongoing Half-Year Profit Pressures?

Yum! Brands recently announced its second quarter 2025 earnings, reporting US$1.93 billion in revenue and US$374 million in net income, up from US$1.76 billion and US$367 million respectively a year earlier. An interesting detail is that while second quarter profits rose, net income for the first half of the year was lower at US$628 million compared to US$681 million for the same period last year, reflecting some ongoing pressure on half-year results. We'll examine how Yum! Brands' stronger second quarter revenue growth factors into its investment narrative, particularly around digital expansion.

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Yum! Brands Investment Narrative Recap

Owning Yum! Brands requires belief in its ability to turn steady global brand strength and ongoing digital investments into consistent revenue and earnings growth. The recent Q2 results showed stronger revenue and a slight uptick in profit, but the softer first-half net income suggests that while near-term digital expansion may help, ongoing consumer demand challenges in key markets remain the most significant risk, and these results haven't changed that risk in a material way.

Among recent announcements, the launch of 'Byte by Yum!', an AI-driven platform for restaurant technology, directly supports Yum!'s digital growth focus. This effort is central to the company's investment thesis, as expanding digital sales channels and operational tech remain its clearest path to improving efficiency and maintaining competitiveness, though short-term cost pressures linked to these investments persist.

Yet, despite stronger digital trends, continued sluggishness in certain markets means investors need to be especially aware of the ongoing risk if consumer preferences...

Read the full narrative on Yum! Brands (it's free!)

Yum! Brands' outlook anticipates $9.5 billion in revenue and $2.1 billion in earnings by 2028. This projection implies a 6.4% annual revenue growth rate and a $0.7 billion earnings increase from the current $1.4 billion.

Uncover how Yum! Brands' forecasts yield a $159.91 fair value, a 13% upside to its current price.

Exploring Other PerspectivesYUM Community Fair Values as at Aug 2025

Four community members on Simply Wall St estimate fair values for Yum! Brands ranging from US$124.80 up to US$10,723,781.76. With doubts lingering around sustained demand in key markets, you may want to compare differing views on future growth and risk before making up your mind.

Explore 4 other fair value estimates on Yum! Brands - why the stock might be worth 12% less than the current price!

Story Continues

Build Your Own Yum! Brands Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

A great starting point for your Yum! Brands research is our analysis highlighting 1 key reward and 3 important warning signs that could impact your investment decision. Our free Yum! Brands research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Yum! Brands' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include YUM.

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