Core Insights - Wendy's is closing several hundred U.S. restaurants and shifting focus towards value offerings after a disappointing fourth quarter performance [1][2] Group 1: Sales Performance - Wendy's global same-store sales fell 10% in the fourth quarter, worse than the 8.5% decline expected by analysts [1] - U.S. same-store sales also declined, with Wendy's closing 28 restaurants in the fourth quarter, ending 2025 with 5,969 locations [2] - The company anticipates closing 5% to 6% of its U.S. restaurants, equating to 298 to 358 locations, in the first half of this year [2] Group 2: Strategic Changes - Wendy's plans to close 240 U.S. locations in 2024, citing that many are outdated [3] - The company aims to emphasize value to attract inflation-weary customers, similar to competitors like McDonald's and Taco Bell [3] Group 3: New Initiatives - Wendy's interim CEO Ken Cook acknowledged that the company had focused too much on limited-time promotions rather than everyday value [4] - In January, Wendy's launched a permanent "Biggie Deals" value menu with three price tiers: $4 Biggie Bites, $6 Biggie Bags, and $8 Biggie Bundles [4] - New product offerings, including a new chicken sandwich, are expected to be introduced this year [4] Group 4: Financial Overview - Wendy's revenue decreased by 5.5% in the fourth quarter to $543 million, slightly above the $537 million forecast by analysts [5] - The company is optimistic that its U.S. turnaround plans and international growth will help stabilize sales, projecting flat global systemwide sales for the year [5] - Systemwide sales fell by 3.5% last year, but Wendy's shares rose nearly 5% in mid-day trading following the announcement [5]

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Core Viewpoint - Wendy's is facing significant challenges in its US operations, leading to plans for closing up to 350 locations due to declining sales and profitability [1][2]. Group 1: Sales Performance - Full-year, system-wide US sales decreased by 5.2% in 2025, with same-restaurant sales down 5.6% year over year [1]. - International sales are performing better, with system-wide sales increasing by 8.1% and same-restaurant sales up 1.3% year over year [3]. Group 2: Operational Changes - The company plans to close 5% to 6% of its approximately 6,000 US locations during the first half of 2026 as part of its turnaround strategy, Project Fresh [2]. - The closures follow a series of hundreds of location shutdowns last year, which were attributed to technological obsolescence [3]. Group 3: Market Reaction - Despite the announcement of closures, Wall Street's reaction to Wendy's earnings report was muted, although the stock price has declined by about 8.5% in 2026 and nearly 50% compared to the previous year [3].

Financial Data and Key Metrics Changes - Global system-wide sales declined 8.3% in Q4, driven by a significant drop in U.S. sales and a tough comparison with the previous year's SpongeBob collaboration [7][30] - Total company adjusted EBITDA was $113.3 million, and adjusted EPS was $0.16 for the fourth quarter [8][33] - For the full year 2025, global system-wide sales decreased by 3.5%, highlighting the need for operational and marketing changes [8][9] Business Line Data and Key Metrics Changes - U.S. same-restaurant sales fell 11.3% in Q4, primarily due to reduced marketing spend and traffic decline, although average check increased [30] - U.S. company-operated restaurants outperformed the broader U.S. system by 410 basis points, driven by operational improvements [30] - International business saw system-wide sales growth of 6.2% in Q4, marking its 21st consecutive quarter of growth [7][32] Market Data and Key Metrics Changes - International expansion remains a priority, with 59 new locations opened in Q4, contributing to an 8.1% increase in system-wide sales for the full year [8][10] - The company achieved net unit growth of over 9% internationally, with 121 new restaurants opened in 2025 [10] Company Strategy and Development Direction - The company is implementing "Project Fresh," focusing on brand revitalization, operational excellence, system optimization, and disciplined capital allocation [12][13] - The strategy aims to restore Wendy's as the highest quality choice in the QSR sector, with a focus on improving customer engagement and menu offerings [15][17] - The company is shifting its marketing approach to emphasize everyday value rather than limited-time promotions, with new platforms like Biggie Deals [16][50] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that 2025 was a challenging year but emphasizes the importance of laying a foundation for future growth [8][12] - The outlook for 2026 is a rebuilding year, with expectations for flat global system-wide sales and improved U.S. same-restaurant sales as initiatives take effect [26][28] - The company anticipates adjusted EBITDA between $460 million and $480 million for 2026, reflecting the impact of system optimization and increased G&A expenses [28][37] Other Important Information - The company returned $330 million to shareholders through dividends and share repurchases, an increase of over $48 million from the prior year [11][34] - The company generated $205 million of free cash flow for the full year, enabling strategic investments while returning capital to shareholders [11][34] Q&A Session Summary Question: Insights on marketing and menu initiatives for the turnaround - Management expressed confidence in the turnaround plan, emphasizing the importance of brand revitalization and operational excellence [47] Question: Details on customer segmentation study findings - The study revealed that many customers seek quality upgrades, particularly in hamburgers, and highlighted the importance of snacking occasions [58] Question: Sentiment among franchisees regarding the turnaround strategy - Franchisees appreciate the flexibility and communication from management, recognizing the need for improved franchisee economics [76]

Financial Data and Key Metrics Changes - Global system-wide sales declined 8.3% in Q4, driven primarily by the U.S. business, with U.S. same-restaurant sales down 11.3% [7][31] - Total adjusted revenue for Q4 was $439.6 million, a decrease of $19.7 million compared to the prior year [34] - Adjusted EBITDA was $113.3 million, down $24.2 million versus the prior year [34] Business Line Data and Key Metrics Changes - U.S. company-operated restaurant margin was 12.7%, declining due to lower traffic and inflation [34] - International business saw system-wide sales growth of 6.2% in Q4, marking its 21st consecutive quarter of growth [7][33] - U.S. digital sales grew 2% year-over-year, with the digital mix reaching an all-time high of 20.6% in Q4 [32] Market Data and Key Metrics Changes - International expansion remains a priority, with 59 new locations opened in Q4, contributing to strong sales in markets like Canada and Mexico [8][10] - The company anticipates continued robust net unit growth in international markets, expecting a similar number of new units in 2026 as in 2025 [29] Company Strategy and Development Direction - The company is focused on Project Fresh, which includes brand revitalization, operational excellence, system optimization, and disciplined capital allocation [12][13] - A new marketing and menu approach is being implemented, emphasizing everyday value and quality, with a structured calendar for new product launches [16][19] - The company plans to close approximately 5%-6% of U.S. restaurants to optimize performance and improve franchisee economics [25][75] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that 2025 was a challenging year but emphasizes the importance of laying a foundation for future growth [8][12] - The outlook for 2026 is a rebuilding year, with expectations for global system-wide sales to be approximately flat and U.S. same-restaurant sales to improve throughout the year [28][29] - Management is optimistic about the operational improvements and customer satisfaction scores, which are expected to drive better performance [9][20] Other Important Information - The company returned $330 million to shareholders through dividends and share repurchases, an increase of over $48 million from the prior year [11][36] - Free cash flow for the full year was $205 million, enabling strategic investments while returning capital to shareholders [11][36] Q&A Session Summary Question: Insights on marketing and menu initiatives for the turnaround - Management expressed confidence in the turnaround plan, emphasizing the importance of brand revitalization and operational excellence [50] Question: Details on customer segmentation study findings - The study revealed that many customers seek quality upgrades, particularly in hamburgers, and highlighted the importance of snacking occasions [61] Question: Sentiment among franchisees regarding the turnaround strategy - Franchisees appreciate the flexibility and communication from management, recognizing the need for improved franchisee economics [80]

Financial Data and Key Metrics Changes - Global system-wide sales declined by 8.3% in Q4 2025, primarily due to a decrease in U.S. sales and lower marketing spend [5][28] - Adjusted EBITDA for the quarter was $113.3 million, down $24.2 million compared to the prior year [6][31] - Adjusted EPS was $0.16 in Q4 2025, reflecting the challenges faced during the year [6][31] - For the full year 2025, global system-wide sales decreased by 3.5%, indicating a need for operational and marketing improvements [6][28] Business Line Data and Key Metrics Changes - U.S. same-restaurant sales fell by 11.3% in Q4 2025, driven by reduced traffic and lower marketing effectiveness [28] - U.S. company-operated restaurant margins were 12.7%, a decline attributed to traffic decreases and inflation [31] - International business saw system-wide sales growth of 6.2% in Q4 2025, marking its 21st consecutive quarter of growth [5][30] Market Data and Key Metrics Changes - The international segment achieved an 8.1% increase in system-wide sales for the full year, with significant growth in regions like Asia Pacific and Latin America [9][30] - The company opened 59 new international locations in Q4 2025, contributing to a total of 159 new openings for the year [6][9] Company Strategy and Development Direction - The company is focused on Project Fresh, a turnaround strategy centered on brand revitalization, operational excellence, system optimization, and disciplined capital allocation [12][25] - The strategy aims to improve customer experience and franchisee economics while enhancing the quality of food offerings [12][25] - The company plans to prioritize everyday value offerings and innovate its menu, particularly in hamburgers and chicken products [16][17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2025 was a challenging year but emphasized the importance of laying a foundation for future growth [6][11] - The outlook for 2026 anticipates flat global system-wide sales, with expectations for U.S. same-restaurant sales to improve as Project Fresh initiatives take effect [25][26] - Management expressed confidence in the brand's potential and the effectiveness of the turnaround plan, highlighting the importance of operational execution [40] Other Important Information - The company generated $205 million in free cash flow for the full year 2025 and returned $330 million to shareholders through dividends and share repurchases [10][32] - The company expects to close approximately 5%-6% of U.S. restaurants as part of its system optimization efforts, which will impact sales and EBITDA [22][69] Q&A Session Summary Question: How will marketing and menu initiatives evolve in 2026? - Management highlighted the importance of revitalizing the brand and improving operational excellence, with a new menu calendar framework to ensure consistent engagement with customers [44][46] Question: What insights were gained from the customer segmentation study? - The study validated the importance of quality and everyday upgrades, leading to a renewed focus on hamburgers and snacking occasions [55][57] Question: What is the current sentiment among franchisees regarding the turnaround strategy? - Franchisees appreciate the flexibility and communication from management, recognizing the need for collaboration to improve overall economics [74][75]

After Q4 Earnings Beat, Is Wendy's (WEN) a Value Opportunity or a Value Trap? - 24/7 Wall St.[S&P 5006,833.00 -0.22%][Dow Jones49,432.90 -0.12%][Nasdaq 10024,673.60 -0.35%][Russell 20002,621.95 +0.24%][FTSE 10010,393.40 -0.40%][Nikkei 22557,453.00 +0.77%][Stock Market Live February 13, 2026: S&P 500 (SPY) Fighting to Go Green][Investing]# After Q4 Earnings Beat, Is Wendy's (WEN) a Value Opportunity or a Value Trap?### Quick ReadWendy's (WEN) U.S. same-restaurant sales plunged 11.3% in Q4. Operating margins ...

分组1 - Wendy's reported quarterly earnings of $0.16 per share, exceeding the Zacks Consensus Estimate of $0.14 per share, but down from $0.25 per share a year ago, representing an earnings surprise of +13.56% [1] - The company posted revenues of $542.97 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 0.28%, but down from $574.27 million year-over-year [2] - Over the last four quarters, Wendy's has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] 分组2 - The stock has underperformed, losing about 12.7% since the beginning of the year compared to the S&P 500's decline of 0.2% [3] - The current consensus EPS estimate for the coming quarter is $0.18 on revenues of $541.26 million, and for the current fiscal year, it is $0.84 on revenues of $2.28 billion [7] - The Zacks Industry Rank for Retail - Restaurants is currently in the bottom 23% of over 250 Zacks industries, indicating potential challenges for the sector [8]

Fourth Quarter 2025 Conference Call February 13, 2026 Aaron Broholm Head of Investor Relations AGENDA BUSINESS UPDATE FINANCIAL RESULTS 2026 FINANCIAL OUTLOOK IR CALENDAR Q&A Many important factors could affect our future results and could cause those results to differ materially from those expressed in or implied by our forward-looking statements. Such factors include, but are not limited to, those identified under the caption "Forward-Looking Statements" in our release issued on February 13, 2026 and in t ...

Core Viewpoint - Wendy's is experiencing significant declines in sales, leading to a drop in stock prices toward a 13-year low, despite beating quarterly earnings expectations [1] Sales Performance - A key sales metric indicating traffic to existing restaurants fell more than anticipated, marking the largest decline in over five years for both global and U.S. locations [1] - This decline contrasts sharply with McDonald's, which reported its fastest sales growth in over two years [1]