WASHINGTON (dpa-AFX) - Pizza Hut (YUM) is set to close hundreds of restaurants across the United States as its owner, Yum! Brands, continues to reassess the long-term direction of the struggling chain.
During its latest earnings call, Yum! said around 250 underperforming Pizza Hut locations will shut in the first half of the year, representing about 3 percent of the brand's U.S. footprint. The company did not disclose which outlets will be affected.
The closures come as part of a broader strategic review launched late last year, in which Yum! is evaluating options for Pizza Hut, including a potential sale. Management offered no new details on that process, other than confirming it expects the review to conclude sometime this year.
Pizza Hut's challenges persist amid intense competition in the U.S. pizza market, particularly from Domino's. The brand posted another weak quarter, with U.S. same-store sales down 3 percent. Efforts to reignite demand through value-focused offerings, such as a $5 pizza, have yet to gain traction with customers.
In contrast, Yum!'s other brands delivered stronger results. Taco Bell continued to outperform, with same-store sales rising 7 percent as frequent menu launches attracted a broad mix of consumers, including higher-income households. KFC showed modest progress in the U.S., posting a 1 percent increase in comparable sales as it leans on menu innovation to regain share from fast-growing chicken rivals.
Despite Pizza Hut's ongoing struggles, Yum! shares are up about 6 percent so far this year, reflecting investor confidence in the group's broader portfolio and its willingness to make tough decisions around underperforming assets.
YUM currently trades at $161.18 or 1.01% higher on the NYSE.
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