Yum Brands Reviews Pizza Hut Amid Slipping U.S. Sales

Post by : Bianca Suleiman

Yum Brands has opened a strategic review of Pizza Hut, saying the long-standing chain faces headwinds in the U.S. market and may be placed on the block as the company examines its options.

Pizza Hut operates almost 20,000 restaurants across more than 100 countries. Its international sales increased by 2% in the first nine months of the year, with China now the brand’s second-largest market outside the United States. Still, roughly half of Pizza Hut’s revenue originates in the U.S., where about 6,500 outlets reported a 7% sales decline over the same period.

The chain’s traditional emphasis on large dine-in restaurants has been a challenge as customer demand shifts toward faster pickup and delivery formats. In 2020, a major U.S. franchisee sought bankruptcy protection and shuttered some 300 locations. Pizza Hut’s share of U.S. pizza-chain sales has fallen to 15.5% from 19.4% in 2019.

Founded in Wichita, Kansas, in 1958 by two brothers who borrowed $600 from their mother, Pizza Hut grew rapidly. The brand introduced its signature red roof in 1969 and led the global pizza market by 1971. PepsiCo bought the chain in 1977 and later spun it into Yum Brands in 1997. By contrast, Domino’s has expanded its delivery-focused model to more than 21,750 stores worldwide.

The consideration of a sale for Pizza Hut underscores larger shifts in the restaurant industry, where legacy sit-down concepts are under pressure to modernize. While Pizza Hut retains solid international traction, its U.S. operations face significant strategic and operational challenges.

Yum’s other businesses, notably KFC and Taco Bell, continue to perform well — the company reported third-quarter revenue growth of 8% — highlighting the disparity between Pizza Hut’s struggles and the stronger performance of its sister brands.