Restaurant Brands International Inc. (NYSE:QSR) reported a second-quarter earnings beat with adjusted EPS of $1.07, surpassing analyst expectations of $0.82.
Revenue came in at $2.52 billion, beating the consensus estimate of $2.24 billion.
• Restaurant Brands shares are under pressure. Why is QSR stock retreating?
Quarter In Detail
Comparable sales rose 3.8% year over year, net restaurant growth of 2.9% Y/Y, and system-wide sales growth of 6.4% Y/Y.
Organic adjusted operating income increased 6.7% Y/Y, while adjusted EPS rose 12.9% Y/Y in the quarter. CEO Josh Kobza highlighted Burger King’s strong performance and continued International segment strength
RBI ended the quarter with $2.3 billion in total liquidity, including $1.1 billion in cash.
Business Performance
Tim Hortons Canada reported flat second quarter same-store sales growth of 0.1%, impacted by a weaker promotional calendar, while maintaining leadership in coffee, breakfast and baked goods. Momentum improved after the launch of Melts, with cold beverages remaining a growth driver through matcha offerings, expanded fountain equipment and products like Soda Swirls.
International segment’s comparable sales growth of 5.5%, net restaurant growth of 5.1%, and system-wide sales growth of 10.7%. Growth was broad-based across key markets, including the UK, Germany, Spain, Brazil, China, Korea, and Japan. Popeyes Brazil continued strong momentum, with comparable sales up more than 20% year to date after similar growth in 2025.
Burger King reported comparable sales growth of 8.6% and system-wide sales growth of 8.2%. U.S. same-store sales rose 8.5%, outperforming the burger QSR industry by more than nine percentage points. Growth was led by the "Reclaim the Flame" strategy, including Whopper-focused marketing, restaurant improvements, stronger operations and franchisee investments.
Burger King continues to execute its multi-year "Reclaim the Flame" strategy to accelerate sales growth and improve franchisee profitability. The plan includes up to $700 million in investments through 2028, covering restaurant remodels and relocations, technology upgrades, kitchen equipment, and building enhancements under the "Royal Reset" initiative. As of June 30, 2026, Burger King had invested $194 million of the planned $550 million Royal Reset spending.
Popeyes reported U.S. net restaurant growth of 0.3%, while same-store sales declined 5.2% and system-wide sales fell 3.3%. The brand completed the rollout of an improved tender specification and saw improved traffic and repeat purchases from value platforms.
Firehouse Subs delivered system-wide sales growth of 7.5%, net restaurant growth of 8.1%, and comparable sales growth of 0.4% in the quarter. This is aided by the successful Steak and Cheese Melt launch, the new Smoke and Honey Melts platform, and continued restaurant expansion.
Cash flow & Dividend
The company generated $501 million in free cash flow during the quarter, including $62 million in capital expenditures and cash inducements.
RBI returned $435 million to shareholders through dividends and share repurchases, including $137 million of stock buybacks during the quarter.
Outlook
RBI continues to target 8% organic adjusted operating income growth and expects net restaurant growth to accelerate toward its 5% unit growth target.
Foreign exchange headwinds are expected to reduce second-half 2026 AOI by approximately $10 million and impact adjusted EPS by 2-3 cents.
The company expects to accelerate Canadian expansion, targeting around 80 gross restaurant openings in 2026, compared with more than 50 openings in 2025. New locations are primarily standard drive-thru formats with payback periods of less than three years.
Management expects Popeyes to return to positive comparable sales growth in the second half of 2026.
The company remains on track to repurchase approximately $500 million of shares in 2026.
QSR Stock Price Activity: Restaurant Brands Intl shares were down 2.23% at $73.83 at the time of publication on Thursday.
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