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Tuesday, May 21, 2024
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Taco Bell Profits Soar Thanks To Pete Davidson

Taco Bell’s breakfast business is enjoying a resurgence, partly due to the efforts of comedian and former “Saturday Night Live” star Pete Davidson.

During Q4, Davidson appeared in an ad campaign for the brand, apologizing jokingly for its “maybe-too-extreme innovations in the mornings.” During Yum Brands’ Q4 earnings call, CEO David Gibbs credited the campaign for the 9% increase in breakfast transactions and said, “Taco Bell brought in Pete Davidson to help drive consumer buzz for breakfast.” Breakfast has traditionally been a profitable part of the restaurant business, but it has struggled in recent years due to the pandemic.

In addition to breakfast, Taco Bell had a successful quarter overall, with 11% same-store sales growth in the U.S. and 250 gross new unit openings, the second highest annual amount ever. The chain also sold 45 million Mexican Pizzas after its return to menus in September.

Pizza Hut U.S. also performed well, with a 4% increase in same-store sales, largely due to the integration of third-party delivery aggregators, which boosted sales by 30% in Q4. The brand’s new Melts platform has also helped attract younger consumers, and has been particularly successful in pre-dinner and individual occasions, as well as among lower-income consumers.

KFC U.S. saw a 1% increase in same-store sales, while The Habit Burger Grill’s same-store sales declined by 1%. Despite an uncertain macroeconomic backdrop, Yum executives remain confident in the company’s position, with labor picking up and the company opening over 4,500 gross new units globally, a record for the company.

Yum Brands is in a positive environment, with an increase in higher-income consumers and a focus on value among lower-income consumers. The company is able to staff its stores appropriately, and its global unit growth record speaks to its ability to grow despite the challenges.

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