Consumers just can’t seem to get enough of Taco Bell’s ‘innovative’ spins on Mexican-inspired food, like its popular Doritos-taco hybrids. Strength in the business helped propel owner Yum Brands to a beat in its most recent quarter.
Yum’s overall revenues slipped in the first quarter to $1.42bn, from $1.44bn in the same three-month period in 2016, but beat Wall Street estimates of $1.38bn. Same-store sales, an important industry metric, climbed 2 per cent.
Taco Bell shone, posting like-for-like sales growth of 8 per cent, blowing past estimates of 4 per cent. Yum pinned the strength on “industry-leading value and innovation”.
The chain has over the past few years invented a slew of unique offerings that have captured diners’ attention, like tacos that are wrapped in Doritos shells with flavours like “nacho cheese” and “cool ranch”. It also offers breakfast deals, like the $1 breakfast soft taco that competes with offerings at other chains, like industry behemoth McDonald’s.
At its KFC division, famous for its fried chicken, comparable sales were up 2 per cent, roughly in-line with Wall Street estimates. Pizza Hut, which is facing stiff competition from the likes of Domino’s Pizza, faced a 3 per cent fall in the key sales metric, worse than the 1 per cent that Wall Street forecast.
Yum’s overall net income fell to $280m from $364m. Adjusted earnings per share of 65 cents topped estimates by 6 cents.
Shares jumped 3.1 per cent in pre-market trading.