Yum! Brands Considers Selling Pizza Hut as US Sales Slide

Yum! Brands Inc., the parent company of Pizza Hut, on Tuesday announced a formal strategic review of the brand to determine how it can “reach its full potential.”

“The Pizza Hut team has been working hard to address business and category challenges; however, Pizza Hut’s performance indicates the need to take additional action to help the brand realise its full value, which may be better executed outside of Yum! Brands,” said Chris Turner, the newly appointed Chief Executive Officer of the US-listed Yum! Brands Inc.

The company also operates quick-service restaurant chains such as KFC and Taco Bell.

The announcement came on the same day Yum! Brands reported that Pizza Hut’s same-store sales fell 1% year-on-year during the third quarter, driven by a 6% decline in the US market. In contrast, Taco Bell and KFC’s same-store sales rose 7% and 3%, respectively.

“Pizza Hut is a beloved global brand and industry innovator that connects people through the joy of pizza, and we are confident in its long-term future,” Turner said, adding that the brand has many strengths, including “deep consumer love, a global footprint, strong growth in many markets, a talented team, and an increasingly powerful technology platform.”

“To truly take advantage of the brand we’ve built and the opportunities ahead, we’ve made the decision to initiate a thorough review of strategic options,” he added.

The company has not set a deadline or definitive timetable for completing the strategic review, and there is no assurance that the process will result in any specific outcome or transaction.

Yum! Brands has appointed Goldman Sachs and Barclays as financial advisers for the review.

Pizza Hut, once part of PepsiCo, became part of Yum! Brands after the beverage company spun off its restaurant division in 1997. Before the pandemic, Pizza Hut sought to shed its dine-in image and reposition itself as a delivery and takeaway brand in the US. Sales surged during Covid-19 lockdowns but declined again once restrictions eased, as demand for pizza began to cool, according to a CNBC report.

Now, amid reduced dining-out habits and tighter household budgets, Pizza Hut is losing ground to rivals. Its share of the US pizza market has dropped from 22.6% in 2019 to 18.7% in 2024, according to Barclays, with Domino’s capturing much of that lost share.

Yum! Brands, which derives around 11% of its operating profit from Pizza Hut, operates roughly 20,000 outlets worldwide, including about 6,500 in the US. As consumers rein in spending, several restaurant chains have been restructuring or offloading underperforming units to strengthen their financial position.

Competitors such as Papa Johns and Domino’s continue to benefit from aggressive promotions and market expansion. Domino’s recently reported a 6% rise in quarterly sales, supported by discount offers that attracted cost-conscious customers.