0000030697-25-000010
SEC filingQ2 2025 revenue fell 1.7% to $560.9M as U.S. same-restaurant sales dropped 3.6%, partially offset by international growth and higher digital penetration.
In Q2 2025, The Wendy's Company reported total revenues of $560.9 million, a decrease of 1.7% compared to $570.7 million in Q2 2024. The decline was primarily driven by a 3.6% drop in U.S. same-restaurant sales, which more than offset a 1.8% increase in international same-restaurant sales. Despite lower revenue, operating profit increased 4.8% to $104.3 million, supported by lower general and administrative expenses ($59.5 million vs. $61.5 million) and reduced advertising funds expense ($111.4 million vs. $120.8 million). Net income rose slightly to $55.1 million from $54.6 million. Company-operated restaurant margin fell 20 basis points to 15.6%, as higher commodity costs and labor rates were partially offset by labor efficiencies and higher average check.
Wendy's U.S. segment revenue decreased 2.4% to $461.1 million, but segment profit edged up to $137.2 million from $136.7 million, as lower advertising funding offset the sales decline. Wendy's International continued its strong momentum, with revenue up 6.9% to $38.9 million and segment profit rising to $13.2 million, fueled by net new restaurant development (26 net new international units in Q2). Global Real Estate & Development revenue declined 1.5% to $60.9 million, partly due to lower development-related fees, though segment profit remained robust at $27.3 million.
Management expects continued labor inflation throughout the remainder of 2025 and plans to mitigate cost pressures through selective menu price increases, product mix optimization, and operational excellence. The company's strategic priorities include driving same-restaurant sales growth, accelerating digital adoption (digital sales reached 20.5% of systemwide sales in Q2), improving restaurant profitability, and expanding global unit count. While no specific numerical guidance was provided, management highlighted a focus on unit growth (94 net new restaurants year-to-date) and stated that available cash and cash flows are expected to meet operating requirements for the next 12 months. The company also has $49.0 million remaining under its share repurchase authorization and intends to continue paying quarterly dividends.
Cash and cash equivalents stood at $281.2M as of June 29, 2025, down from $450.5M at December 29, 2024, primarily due to $186M in share repurchases and $76M in dividends. Total debt remained stable at $2.73B, with long-term debt of $2.65B and current portion of $78.5M. The company has $49M remaining under its buyback authorization. Shareholders' equity decreased to $112.9M from $259.4M, driven by aggressive buybacks and dividends exceeding net income.
The Notes disclosed lease guarantees of $96.8M and outstanding letters of credit of $29.0M. No specific purchase commitments or supply agreements were detailed. Deferred franchise fees (performance obligations) totaled $99.4M.
Share buybacks totaled $186M in the first half of 2025, significantly outpacing the $34M in the prior-year period. Dividends paid were $76.2M ($0.39 per share cumulative for Q1 and Q2). Net debt change was minimal, with $23.5M in proceeds and $23.1M in repayments. Capital expenditures were $39.1M, or 3.6% of total revenue.
Segments are reported as Wendy's U.S., Wendy's International, and Global Real Estate & Development. For Q2 2025, U.S. segment revenue declined 2.4% to $461M, with adjusted EBITDA of $137M. International revenue grew 6.8% to $39M, generating $13M in adjusted EBITDA. Global Real Estate & Development revenue fell 1.4% to $61M, with adjusted EBITDA of $27M. International performance improved despite a $342K incremental advertising funding.