Yum China (NYSE:YUMC) Announces Earnings Results, Beats Estimates By $0.05 EPS

Yum China (NYSE:YUMC) announced its earnings results on Wednesday. The company reported $0.40 earnings per share for the quarter, topping the consensus estimate of $0.35 by $0.05, FiscalAI reports. The firm had revenue of $2.82 billion for the quarter, compared to the consensus estimate of $2.72 billion. Yum China had a net margin of 7.81% and a return on equity of 14.08%. The firm’s revenue for the quarter was up 8.8% on a year-over-year basis. During the same period in the prior year, the firm earned $0.30 EPS.

Here are the key takeaways from Yum China’s conference call:

• Store growth and sales momentum: Yum China opened more than 1,700 net new stores in 2025 (>18,000 total) and expects to exceed 20,000 stores in 2026, while same‑store sales were positive for three consecutive quarters and Q4 system sales grew 7%.
• Profitability improvement: Full‑year operating profit rose 11% to $1.3B, OP margin expanded to 10.9% (highest since the U.S. listing excluding special items), Q4 operating profit grew 23%, and ROIC increased to 17.3%.
• Strong shareholder returns: Management returned $1.5B in 2025, committed to $1.5B annually through 2026, raised the quarterly dividend by 21% and initiated a $460M repurchase for H1 2026, with plans to return ~100% of free cash flow from 2027 onward.
• Delivery mix and cost pressure: Delivery mix rose to ~53% in Q4, driving higher rider/labor costs; the company expects delivery mix to increase further in 2026 and warned of tougher Q1 margin comparisons and smaller commodity cost tailwinds.
• New formats, modules and tech for growth: Management is scaling K‑Coffee (2,200 locations), expanding K‑Pro, piloting Gemini KFC/Pizza Hut side‑by‑side pairs and accelerating franchising (franchise mix of new openings rose to 36%), while deploying Gen AI (QSmart, Smart K) to boost efficiency and customer engagement.

Yum China Trading Up 3.4%

Shares of Yum China stock traded up $1.79 during trading on Thursday, hitting $54.93. The stock had a trading volume of 696,961 shares, compared to its average volume of 1,187,986. The stock has a 50 day simple moving average of $48.27 and a 200 day simple moving average of $46.08. The company has a quick ratio of 1.15, a current ratio of 1.32 and a debt-to-equity ratio of 0.01. Yum China has a 1 year low of $41.00 and a 1 year high of $55.27. The company has a market capitalization of $19.85 billion, a PE ratio of 22.79, a P/E/G ratio of 1.63 and a beta of 0.14.

Yum China Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Wednesday, March 25th. Shareholders of record on Wednesday, March 4th will be issued a $0.29 dividend. This is an increase from Yum China’s previous quarterly dividend of $0.24. This represents a $1.16 annualized dividend and a dividend yield of 2.1%. The ex-dividend date of this dividend is Wednesday, March 4th. Yum China’s dividend payout ratio is currently 39.83%.

Yum China declared that its board has authorized a share buyback plan on Friday, December 12th that authorizes the company to repurchase $1.00 billion in shares. This repurchase authorization authorizes the company to buy up to 5.8% of its stock through open market purchases. Stock repurchase plans are often a sign that the company’s leadership believes its stock is undervalued.

Analyst Upgrades and Downgrades

Several analysts have recently weighed in on the stock. Weiss Ratings reaffirmed a “hold (c)” rating on shares of Yum China in a report on Wednesday, January 21st. CLSA reaffirmed an “outperform” rating and set a $55.00 price target on shares of Yum China in a research note on Tuesday, November 25th. Jefferies Financial Group reiterated a “buy” rating and set a $63.64 target price on shares of Yum China in a research report on Thursday. Finally, The Goldman Sachs Group restated a “buy” rating and set a $58.50 price objective on shares of Yum China in a report on Wednesday. Three research analysts have rated the stock with a Buy rating and one has given a Hold rating to the stock. According to MarketBeat.com, the company currently has an average rating of “Moderate Buy” and a consensus price target of $59.05.

Insider Activity

In other news, insider Duoduo (Howard) Huang sold 4,888 shares of the firm’s stock in a transaction dated Monday, November 24th. The stock was sold at an average price of $48.10, for a total transaction of $235,112.80. Following the completion of the sale, the insider directly owned 22,510 shares of the company’s stock, valued at $1,082,731. This trade represents a 17.84% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this hyperlink. Also, insider Jeff Kuai sold 5,167 shares of Yum China stock in a transaction that occurred on Thursday, November 20th. The shares were sold at an average price of $48.00, for a total transaction of $248,016.00. Following the completion of the sale, the insider owned 56,602 shares of the company’s stock, valued at $2,716,896. This trade represents a 8.37% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 18,242 shares of company stock worth $878,397 in the last ninety days. Corporate insiders own 0.40% of the company’s stock.

Institutional Trading of Yum China

A number of hedge funds have recently modified their holdings of YUMC. Caitong International Asset Management Co. Ltd grew its stake in Yum China by 147.4% during the third quarter. Caitong International Asset Management Co. Ltd now owns 945 shares of the company’s stock worth $41,000 after buying an additional 563 shares during the last quarter. Quarry LP acquired a new stake in shares of Yum China during the 3rd quarter worth approximately $45,000. Advisory Services Network LLC acquired a new position in shares of Yum China in the 3rd quarter valued at $56,000. Parallel Advisors LLC grew its position in shares of Yum China by 33.1% during the 3rd quarter. Parallel Advisors LLC now owns 1,386 shares of the company’s stock worth $59,000 after buying an additional 345 shares during the period. Finally, Geneos Wealth Management Inc. raised its holdings in Yum China by 29.5% in the second quarter. Geneos Wealth Management Inc. now owns 1,452 shares of the company’s stock worth $65,000 after purchasing an additional 331 shares during the period. Institutional investors own 85.58% of the company’s stock.

Key Stories Impacting Yum China

Here are the key news stories impacting Yum China this week:

• Positive Sentiment: Q4 beats: Yum China reported $0.40 EPS vs. $0.35 consensus and revenue of $2.82B (vs. $2.72B est.), with revenue up ~8.8% YoY and expanded margins — a clear near-term earnings catalyst. Yum China shares rise as fourth quarter earnings, revenue top estimates
• Positive Sentiment: Aggressive expansion: Management plans to open over 1,900 new stores in 2026 and increase the franchise mix toward 40–50%, which should accelerate unit growth, lower capital intensity and improve returns over time. Yum China outlines over 1,900 new stores in 2026 as franchise mix rises to 40–50%
• Positive Sentiment: Dividend hike: Yum China raised its quarterly dividend to $0.29 (a ~20.8% increase), signaling confidence in cash flow and returning more capital to shareholders. Yum China Declares USD 0.29 Quarterly Dividend for FY2025
• Positive Sentiment: Delivery and store growth boosted profitability: Management attributes margin expansion to stronger delivery volumes and operating leverage as store base grows and the franchise mix increases. Yum China gains after seeing profit improve amid continued store growth push
• Neutral Sentiment: Earnings call/transcript available — read management commentary and slides for detail on 2026 openings, unit economics and margin drivers to assess sustainability of the beat. Yum China (YUMC) Q4 2025 Earnings Call Transcript
• Neutral Sentiment: Analyst context: Coverage notes the beat across key metrics and compares results to estimates — useful for modeling FY2026 consensus (~$2.54 FY EPS currently). Yum China (YUMC) Q4 Earnings: Taking a Look at Key Metrics Versus Estimates
• Negative Sentiment: Valuation and positioning: The shares trade near a one‑year high with a mid‑teens P/E (~22.6); much of the good news is priced in, which could limit near-term upside absent continued outperformance or upward guidance.

Yum China Company Profile

Yum China Holdings, Inc operates as the largest quick-service restaurant company in China, through its ownership and franchising of brands such as KFC, Pizza Hut and Taco Bell. The company’s core business encompasses full-service and fast‐casual dining, takeout and delivery channels, as well as ancillary services including loyalty programs and digital ordering platforms. Yum China’s restaurants offer a diverse menu that adapts global brand concepts to local consumer preferences, featuring items such as soy‐marinated chicken, customized pizzas and region‐inspired side dishes.

In addition to its signature brands, Yum China has expanded its portfolio to include innovative concepts tailored to evolving market trends, such as plant‐based offerings, self‐service kiosks and mobile app integrations.