Delivered 10% Revenue Growth and 12% Operating Profit Growth with Record Quarterly Net New Store Openings
OP Margin Expanded Year Over Year for the Eighth Consecutive Quarter
Diluted EPS Up 13%, or 11% Excluding Mark-to-Market and F/X Impact
On Track to Return $1.5 Billion to Shareholders in 2026. Around 9% of Current Market Capitalization
SHANGHAI, April 29. 2026 /PRNewswire/ — Yum China Holdings, Inc. (the “Company” or “Yum China”) (NYSE: YUMC and HKEX: 9987) today reported unaudited results for the first quarter ended March 31. 2026.
First Quarter Highlights
Total system sales grew 4% year over year (“YoY”), excluding foreign currency translation (“F/X”).
Same-store sales reached 100% of the prior year’s level. Same-store transactions grew 2% YoY, the 13th consecutive quarter of growth.
Total revenues increased 10% YoY to $3.3 billion, or a 4% increase excluding F/X.
Opened 636 net new stores, an all-time quarterly high and more than double the openings in the same quarter last year, with 39% opened by franchisees. Total store count reached 18.737 as of March 31. 2026.
Operating profit grew 12% YoY to $447 million, a first-quarter record high. Core operating profit grew 6% YoY.
OP margin was 13.7%, an increase of 30 basis points YoY, the 8th consecutive quarter of OP margin expansion.
Restaurant margin was 18.2%, a decrease of 40 basis points YoY, primarily due to increased rider cost from a higher delivery mix, partially offset by streamlined operations.
Diluted EPS increased 13% YoY to $0.87. or up 7% excluding F/X, and up 11% further excluding the impact1 of the mark-to-market equity investments.
Returned $316 million to shareholders through $214 million in share repurchases and $102 million in cash dividends.
Delivery sales grew 31% YoY. Delivery contributed approximately 54% of total Company sales, up from 42% in the same quarter last year.
Active Members of KFC or Pizza Hut, defined as those who transacted in the past 12 months, exceeded 270 million, representing a 9% YoY increase.
CEO Comments
Joey Wat, CEO of Yum China, commented, “We delivered solid results in a dynamic environment, and remain encouraged by early signs of improving consumer sentiment. The late timing of Chinese New Year and the extra April spring break affected gathering patterns and same-store sales growth in Q1. However, combined March and April trading has so far been in line with our expectations. In Q1. we accelerated store openings to a record level to capture significant market opportunities. At the same time, we drove system sales growth, operating profit growth and OP margin expansion for the eighth consecutive quarter, thanks to our teams’ dedication.”
Wat continued, “Importantly, same–store transactions increased for the 13th consecutive quarter for both Yum China and Pizza Hut. KFC achieved positive same–store sales growth for the fourth consecutive quarter and continued to capture new occasions through the rapid rollout of KCOFFEE cafe and KPRO side-by-side modules, and car-side pickup services. Pizza Hut delivered 18% operating profit growth on top of last year’s 27% increase and further improved its restaurant and OP margins, while entering more than 100 new cities in Q1. with WOW as the key driver.”
Wat concluded, “Looking ahead, we will fuel further growth through front-end segmentation and back-end consolidation. With our strong foundation, dual focus on innovation and operational efficiency, and a more rational delivery platform competition, we are confident in delivering our full-year targets and creating sustainable long–term value for our shareholders.”
Capital Returns to Shareholders
The Company is on track to return $1.5 billion each year from 2024 to 2026. which is annually around 9% of our market capitalization as of April 28. 2026.
In the first quarter of 2026. the Company returned $316 million in capital to shareholders through $214 million in share repurchases and $102 million in cash dividends. The Company repurchased 4.1 million shares of common stock during the quarter.
The Board declared a cash dividend of $0.29 per share on Yum China’s common stock, payable on June 17. 2026 to shareholders of record as of the close of business on May 27. 2026.
Starting in 2027. the Company plans to return approximately 100% of annual free cash flow after subsidiaries’ dividend payments to non-controlling interests. This is anticipated to translate into an average annual return of approximately $900 million to over $1 billion in 2027 and 2028. and to exceed $1 billion in 2028.
System sales for KFC grew 5% YoY. Same-store sales increased 1% YoY, the fourth consecutive quarter of growth. Same-store transactions also grew 1% YoY. Ticket average was 1% lower YoY, driven mainly by the rapid growth of smaller orders, partially offset by increased delivery mix, which carries a relatively higher ticket average.
Delivery sales grew 33% YoY, contributing approximately 55% of KFC’s Company sales, up from 43% in the same quarter last year.
KFC opened 457 net new stores during the quarter, 55% higher than the openings in the same quarter last year, with 172 net new stores opened by franchisees, accounting for 38%. Total store count reached 13.454 as of March 31. 2026.
Operating profit increased 8% YoY to $417 million. Core operating profit increased 3% YoY.
OP margin was 17.0%, a decrease of 20 basis points YoY.
Restaurant margin was 19.1%, a decrease of 70 basis points YoY, primarily due to the impact of increased rider cost resulting from higher delivery mix and value-for-money offerings, partially offset by streamlined operations and favorable commodity prices.
System sales for KFC grew 5% YoY. Same-store sales increased 1% YoY, the fourth consecutive quarter of growth. Same-store transactions also grew 1% YoY. Ticket average was 1% lower YoY, driven mainly by the rapid growth of smaller orders, partially offset by increased delivery mix, which carries a relatively higher ticket average.
Delivery sales grew 33% YoY, contributing approximately 55% of KFC’s Company sales, up from 43% in the same quarter last year.
KFC opened 457 net new stores during the quarter, 55% higher than the openings in the same quarter last year, with 172 net new stores opened by franchisees, accounting for 38%. Total store count reached 13.454 as of March 31. 2026.
Operating profit increased 8% YoY to $417 million. Core operating profit increased 3% YoY.
OP margin was 17.0%, a decrease of 20 basis points YoY.
Restaurant margin was 19.1%, a decrease of 70 basis points YoY, primarily due to the impact of increased rider cost resulting from higher delivery mix and value-for-money offerings, partially offset by streamlined operations and favorable commodity prices.
