THE WENDY'S COMPANY REPORTS FIRST QUARTER 2026 RESULTS
Rhea-AI Summary
Wendy's (Nasdaq: WEN) reported Q1 2026 results with global systemwide sales of $3.22B (down 5.5%) and international sales up 6.0%. Reported net income was $22.7M, adjusted EBITDA was $111.3M, and diluted EPS was $0.12. The company announced a franchise agreement to build up to 1,000 restaurants in China, declared a quarterly dividend of $0.14 payable June 15, and reaffirmed its 2026 outlook with adjusted EBITDA $460–$480M and adjusted EPS $0.56–$0.60.
Positive
- International systemwide sales +6.0% in Q1 2026
- Franchise agreement to build up to 1,000 restaurants in China
- Reaffirmed 2026 outlook including adjusted EBITDA $460–$480M
- Quarterly dividend declared of $0.14 per share payable June 15, 2026
Negative
- Global systemwide sales down 5.5% to $3.22B
- U.S. same-restaurant sales declined 7.8% in Q1 2026
- Reported net income down to $22.7M (42.1% decrease YoY)
- U.S. company-operated restaurant margin fell 340 bps to 11.4%
- Adjusted EBITDA decreased to $111.3M (down 10.6%)
- Free cash flow declined to $36.5M (down 46.3%)
News Market Reaction – WEN
In the May 8 session, WEN gained 5.04%, reflecting a notable positive market reaction. Argus tracked a peak move of +2.2% during that session. Our momentum scanner triggered 6 alerts that day, indicating moderate trading interest and price volatility.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Feb 13 | Q4 2025 earnings | Neutral | +2.9% | Q4 and 2025 results with global sales down and 2026 flat outlook reiterated. |
| Nov 7 | Q3 2025 earnings | Positive | +1.6% | Q3 2025 results with EBITDA growth, dividend, and higher free cash flow outlook. |
| Aug 8 | Q2 2025 earnings | Negative | +1.3% | Q2 2025 report highlighting U.S. sales weakness and a lowered 2025 outlook. |
| May 2 | Q1 2025 earnings | Negative | +0.5% | Q1 2025 global sales decline and softer earnings despite international strength. |
| Feb 13 | Q4 2024 earnings | Positive | +3.8% | Q4 2024 earnings with systemwide growth, higher adjusted EPS, and 2025 growth outlook. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Earnings headlines have often produced modest positive price moves, even when fundamentals were mixed or soft.
Over the last five earnings cycles, Wendy’s has reported slowing global systemwide sales and pressure in its U.S. business, while international operations generally grew. Q1 and Q2 2025 showed declining global sales and U.S. same-restaurant weakness, leading to lowered 2025 guidance. By Q4 2025, global systemwide sales were $14.0B, down 3.5%, and 2026 guidance called for roughly flat sales and adjusted EPS of $0.56–$0.60. Today’s Q1 2026 results and reaffirmed outlook fit that cautious trajectory.
Key Terms
systemwide sales financial
same-restaurant sales growth financial
adjusted ebitda financial
free cash flow financial
non-gaap financial measures financial
quarterly cash dividend financial
webcast technical
AI-generated analysis. How Rhea-AI works. Not financial advice.
- Global systemwide sales were
$3.2 billion 5.5% - International systemwide sales grew
6.0% - Reported net income was
$22.7 million $111.3 million - Reported diluted earnings per share and adjusted earnings per share were
$0.12 - Entered into a franchise agreement to build up to 1,000 restaurants across
China - Reaffirms full-year 2026 outlook
"We are taking decisive action to strengthen the Wendy's system and improve performance," said Ken Cook, Interim CEO. "During the first quarter, we introduced a new Biggie platform, upgraded our premium hamburgers, and launched new chicken sandwiches. Additionally, our focus on operational excellence is driving improvement in order accuracy and key customer satisfaction metrics. While our first quarter results reflect a business in the early stages of a turnaround, we are making progress to improve our
"Our international business continues to deliver strong results, with systemwide sales up
"These actions are strengthening our foundation and positioning Wendy's to regain momentum and deliver sustainable growth and long-term value creation."
Operational Highlights | 2025 | 2026 | |||||||||
First Quarter | US | Intl | Global | US | Intl | Global | |||||
Systemwide Sales Growth (1) (2) | (2.6) % | 8.9 % | (1.1) % | (7.3) % | 6.0 % | (5.5) % | |||||
Same-Restaurant Sales Growth (1) (2) | (2.8) % | 2.3 % | (2.1) % | (7.8) % | (0.4) % | (6.8) % | |||||
Systemwide Sales (In US$ Millions) (2) (3) | |||||||||||
Restaurant Openings - Total / Net | 28 / 25 | 46 / 43 | 74 / 68 | 23 / (164) | 27 / 18 | 50 / (146) | |||||
Quarter End Restaurant Count | 5,958 | 1,350 | 7,308 | 5,805 | 1,446 | 7,251 | |||||
(1) Systemwide sales growth and same-restaurant sales growth are calculated on a constant currency basis and include sales by both | |||||||||||
(2) Excludes | |||||||||||
(3) Systemwide sales include sales at both Company-operated and franchise restaurants. | |||||||||||
Financial Highlights | First Quarter | ||||
2025 | 2026 | B / (W) | |||
($ In Millions Except Per Share Amounts) | (Unaudited) | ||||
Total Revenues | $ 523.5 | $ 540.6 | 3.3 % | ||
Adjusted Revenues (1) | $ 423.1 | $ 432.3 | 2.2 % | ||
14.8 % | 11.4 % | (340)bps | |||
General and Administrative Expense | $ 68.2 | $ 72.8 | (6.7) % | ||
Operating Profit | $ 83.1 | $ 64.9 | (21.9) % | ||
Net Income | $ 39.2 | $ 22.7 | (42.1) % | ||
Adjusted EBITDA (1) | $ 124.5 | $ 111.3 | (10.6) % | ||
Reported Diluted Earnings Per Share | $ 0.19 | $ 0.12 | (36.8) % | ||
Adjusted Earnings Per Share (1) | $ 0.20 | $ 0.12 | (40.0) % | ||
Cash Flow from Operations | $ 85.4 | $ 59.4 | (30.4) % | ||
Free Cash Flow (1) | $ 68.0 | $ 36.5 | (46.3) % | ||
(1) See "Disclosure Regarding Non-GAAP Financial Measures" and the reconciliation tables that accompany this release for a |
First Quarter Financial Highlights
Systemwide Sales
Global systemwide sales decreased, driven largely by lower
Total Revenues
The increase in total reported revenues resulted primarily from an increase in franchise fees related to the system optimization program, higher advertising funds revenue due to local advertising funds being reallocated to
The decrease in
General and Administrative Expense
The increase in general and administrative expense was primarily due to an increase in employee compensation and benefits and higher professional fees.
Operating Profit
The decrease in operating profit was primarily due to a decrease in
Net Income
The decrease in reported net income was primarily due to a decrease in operating profit and an increase in interest expense, partially offset by lower income taxes.
Adjusted EBITDA
The decrease in adjusted EBITDA was primarily driven by a decrease in
Adjusted Earnings Per Share
The decrease in adjusted earnings per share was primarily driven by a decrease in adjusted EBITDA, an increase in depreciation, and an increase in interest expense.
Free Cash Flow
The decrease in free cash flow was driven by a decrease in net cash provided by operating activities, partially offset by a decrease in capital expenditures and investments associated with the Company's franchise development fund.
Company Declares Quarterly Dividend
The Company announced today the declaration of its regular quarterly cash dividend of
Share Repurchases
The Company did not repurchase any shares in the first quarter of 2026 and has not repurchased any shares in the second quarter of 2026 as of the date of this release. As of May 1, approximately
2026 Outlook
During 2026 the Company Continues to Expect:
Global systemwide sales growth | Approximately Flat | |
Adjusted EBITDA | ||
Adjusted earnings per share | ||
Capital expenditures and franchise development fund investments | ||
Free cash flow |
Conference Call and Webcast Scheduled for 8:30 a.m. Today, May 8
The Company will host a conference call on Friday, May 8 at 8:30 a.m. ET, with a simultaneous webcast from the Company's Investor Relations website at www.irwendys.com. The related presentation materials are now available on the Company's Investor Relations website. The live conference call will be available by telephone at (844) 200-6205 for domestic callers and (929) 526-1599 for international callers, both using event ID 280384. A replay of the webcast will be available on the Company's Investor Relations website.
About Wendy's
The Wendy's Company (Nasdaq: WEN) and Wendy's® franchisees employ hundreds of thousands of people across more than 7,000 restaurants worldwide. Founded in 1969, Wendy's is committed to the promise of Fresh Famous Food, Made Right, For You, delivered to customers through its craveable menu including made-to-order square hamburgers using fresh beef*, and fan favorites like the Spicy Chicken Sandwich and nuggets, Baconator®, and the Frosty® dessert. Wendy's supports the Dave Thomas Foundation for Adoption®, established by its founder, which seeks to dramatically increase the number of adoptions of children waiting in
*Fresh beef available in the contiguous
Investor Contact:
Aaron Broholm
Head of Investor Relations
(614) 764-3345; aaron.broholm@wendys.com
Media Contact:
Heidi Schauer
Vice President – Communications, Public Affairs & Customer Care
(614) 764-3368; heidi.schauer@wendys.com
Forward-Looking Statements
This release contains certain statements that are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Generally, forward-looking statements include the words "may," "believes," "plans," "expects," "anticipates," "intends," "estimate," "goal," "upcoming," "outlook," "guidance" or the negation thereof, or similar expressions. In addition, all statements that address future operating, financial or business performance, strategies or initiatives, future efficiencies or savings, anticipated costs or charges, future capitalization, anticipated impacts of recent or pending investments or transactions and statements expressing general views about future results or brand health are forward-looking statements within the meaning of the Reform Act. Forward-looking statements are based on the Company's expectations at the time such statements are made, speak only as of the dates they are made and are susceptible to a number of risks, uncertainties and other factors. For all such forward-looking statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Reform Act. The Company's actual results, performance and achievements may differ materially from any future results, performance or achievements expressed or implied by the Company's forward-looking statements.
Many important factors could affect the Company's future results and cause those results to differ materially from those expressed in or implied by the Company's forward-looking statements. Such factors include, but are not limited to, the following: (1) the impact of competition or poor customer experiences at Wendy's restaurants; (2) adverse economic conditions or volatility or disruptions, including in regions with a high concentration of Wendy's restaurants; (3) changes in discretionary consumer spending and consumer tastes and preferences; (4) conditions beyond the Company's control, such as adverse weather conditions, natural disasters, hostilities, social unrest, health epidemics or pandemics or other catastrophic events; (5) impacts to the Company's corporate reputation or the value and perception of the Company's brand; (6) the effectiveness of the Company's marketing and advertising programs and new product development; (7) the Company's ability to manage the impact of social or digital media; (8) the Company's ability to protect its intellectual property; (9) food safety events or health concerns involving the Company's products; (10) the Company's ability to successfully implement important strategic initiatives, including its Project Fresh plan, effectively managing or maintaining growth and market share across its dayparts or executing strategic transactions; (11) the Company's ability to grow its business through new restaurant development; (12) the Company's ability to effectively manage the acquisition and disposition of restaurants and other restaurant activity; (13) risks associated with leasing and owning significant amounts of real estate, including environmental matters; (14) risks associated with the Company's international operations, including the ability to execute its international growth strategy; (15) changes in commodity and other operating costs; (16) shortages or interruptions in the supply or distribution of the Company's products and other risks associated with the Company's independent supply chain purchasing co-op; (17) the impact of increased labor costs or labor shortages; (18) the continued succession and retention of key personnel and the effectiveness of the Company's leadership and organizational structure; (19) risks associated with the Company's digital commerce strategy, platforms and technologies, including its ability to adapt to changes in industry trends and consumer preferences; (20) the Company's and its franchisees' dependence on computer systems and information technology, including risks associated with the failure or interruption of its systems or technology or the occurrence of cybersecurity incidents or deficiencies; (21) risks associated with the Company's securitized financing facility and other debt agreements, including compliance with operational and financial covenants, restrictions on its ability to raise additional capital, the impact of its overall debt levels and the Company's ability to generate sufficient cash flow to meet its debt service obligations and operate its business; (22) risks associated with the Company's capital allocation policy, including the amount and timing of equity and debt repurchases and dividend payments; (23) risks associated with complaints and litigation, compliance with legal and regulatory requirements and a focus on corporate responsibility issues; (24) risks associated with the availability and cost of insurance, the recognition of impairment or other charges, changes in tax rates or tax laws and fluctuations in foreign currency exchange rates; (25) risks associated with the Company's predominantly franchised business model; (26) Trian Fund Management, L.P. and certain of its affiliates filed a Schedule 13D/A with the Securities and Exchange Commission on February 18, 2026 indicating, among other things, that they intend to explore and evaluate the possibility of participating, alone or with third parties, in certain potential transactions with respect to the Company to enhance stockholder value; there can be no assurance that (i) any such potential transactions will occur or result in additional value for the Company's stockholders or (ii) that the exploration of potential transactions will not have an adverse impact on the Company's business; and (27) other risks and uncertainties cited in the Company's releases, public statements and/or filings with the Securities and Exchange Commission, including those identified in the "Risk Factors" sections of the Company's Forms 10-K and 10-Q.
All future written and oral forward-looking statements attributable to the Company or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to above. New risks and uncertainties arise from time to time, and factors that the Company currently deems immaterial may become material, and it is impossible for the Company to predict these events or how they may affect the Company.
The Company assumes no obligation to update any forward-looking statements after the date of this release as a result of new information, future events or developments, except as required by federal securities laws, although the Company may do so from time to time. The Company does not endorse any projections regarding future performance that may be made by third parties.
Disclosure Regarding Non-GAAP Financial Measures
In addition to the financial measures presented in this release in accordance with
The Company uses adjusted revenue, adjusted EBITDA and adjusted earnings per share as internal measures of business operating performance and as performance measures for benchmarking against the Company's peers and competitors. Adjusted EBITDA is also used by the Company in establishing performance goals for purposes of executive compensation. The Company believes its presentation of adjusted revenue, adjusted EBITDA and adjusted earnings per share provides a meaningful perspective of the underlying operating performance of our current business and enables investors to better understand and evaluate our historical and prospective operating performance. The Company believes these non-GAAP financial measures are important supplemental measures of operating performance because they eliminate items that vary from period to period without correlation to our core operating performance and highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. Due to the nature and/or size of the items being excluded, such items do not reflect future gains, losses, expenses or benefits and are not indicative of our future operating performance. The Company believes investors, analysts and other interested parties use adjusted revenue, adjusted EBITDA, and adjusted earnings per share in evaluating issuers, and the presentation of these measures facilitates a comparative assessment of the Company's operating performance in addition to the Company's performance based on GAAP results.
This release also includes disclosure regarding the Company's free cash flow. Free cash flow is a non-GAAP financial measure that is used by the Company as an internal measure of liquidity. The Company defines free cash flow as cash flows from operations minus (i) capital expenditures, (ii) expenditures related to the Company's franchise development fund and (iii) the net change in the restricted operating assets and liabilities of the advertising funds and any excess/deficit of advertising funds revenue over advertising funds expense included in net income, as reported under GAAP. The impact of our advertising funds is excluded because the funds are used solely for advertising and are not available for the Company's working capital needs. The Company may also make additional adjustments for certain non-recurring or unusual items to the extent identified in the reconciliation tables that accompany this release. The Company believes free cash flow is an important liquidity measure for investors and other interested persons because it communicates how much cash flow is available for working capital needs or to be used for repurchasing shares, paying dividends, repaying or refinancing debt, financing possible acquisitions or investments or other uses of cash.
Adjusted revenue, adjusted EBITDA, adjusted earnings per share, and free cash flow are not recognized terms under GAAP, and the Company's presentation of these non-GAAP financial measures does not replace the presentation of the Company's financial results in accordance with GAAP. Because all companies do not calculate adjusted revenue, adjusted EBITDA, adjusted earnings per share, and free cash flow (and similarly titled financial measures) in the same way, those measures as used by other companies may not be consistent with the way the Company calculates such measures. The non-GAAP financial measures included in this release should not be construed as substitutes for or better indicators of the Company's performance than the most directly comparable GAAP financial measures. See the reconciliation tables that accompany this release for additional information regarding certain of the non-GAAP financial measures included herein.
In addition, this release includes forward-looking projections for certain non-GAAP financial measures, including adjusted EBITDA, adjusted earnings per share and free cash flow. The Company excludes certain expenses and benefits from adjusted EBITDA, adjusted earnings per share and free cash flow, such as the impact from our advertising funds, including the net change in the restricted operating assets and liabilities and any excess or deficit of advertising fund revenues over advertising fund expenses, impairment of long-lived assets, reorganization and realignment costs, system optimization gains, net, amortization of cloud computing arrangements, gain on early extinguishment of debt, net, and the timing and resolution of certain tax matters. Due to the uncertainty and variability of the nature and amount of those expenses and benefits, the Company is unable without unreasonable effort to provide projections of net income, earnings per share or net cash provided by operating activities, or a reconciliation of those projected measures.
Key Business Measures
The Company tracks its results of operations and manages its business using certain key business measures, including same-restaurant sales, systemwide sales and Company-operated restaurant margin, which are measures commonly used in the quick-service restaurant industry that are important to understanding Company performance.
Same-restaurant sales and systemwide sales each include sales by both Company-operated and franchise restaurants. The Company reports same-restaurant sales for new restaurants after they have been open for 15 continuous months and for reimaged restaurants as soon as they reopen. Restaurants temporarily closed for more than one fiscal week are excluded from same-restaurant sales.
Franchise restaurant sales are reported by our franchisees and represent their revenues from sales at franchised Wendy's restaurants. Sales by franchise restaurants are not recorded as Company revenues and are not included in the Company's consolidated financial statements. However, the Company's royalty revenues are computed as percentages of sales made by Wendy's franchisees and, as a result, sales by franchisees have a direct effect on the Company's royalty revenues and profitability.
Same-restaurant sales and systemwide sales exclude sales from
The Company calculates same-restaurant sales and systemwide sales growth on a constant currency basis. Constant currency results exclude the impact of foreign currency translation and are derived by translating current year results at prior year average exchange rates. The Company believes excluding the impact of foreign currency translation provides better year over year comparability.
The Wendy's Company and Subsidiaries Condensed Consolidated Statements of Operations Three Month Periods Ended March 30, 2025 and March 29, 2026 (In Thousands Except Per Share Amounts) (Unaudited) | |||
Three Months Ended | |||
2025 | 2026 | ||
Revenues: | |||
Sales | $ 219,510 | $ 225,497 | |
Franchise royalty revenue | 121,675 | 116,190 | |
Franchise fees | 23,473 | 31,705 | |
Franchise rental income | 58,454 | 58,904 | |
Advertising funds revenue | 100,360 | 108,341 | |
523,472 | 540,637 | ||
Costs and expenses: | |||
Cost of sales | 188,169 | 201,049 | |
Franchise support and other costs | 16,596 | 21,991 | |
Franchise rental expense | 30,701 | 30,176 | |
Advertising funds expense | 101,528 | 108,615 | |
General and administrative | 68,204 | 72,843 | |
Depreciation and amortization (exclusive of amortization of cloud computing | 36,549 | 40,575 | |
Amortization of cloud computing arrangements | 4,167 | 4,762 | |
System optimization losses (gains), net | 90 | (1,625) | |
Reorganization and realignment costs | (692) | (162) | |
Impairment of long-lived assets | 1,421 | 2,572 | |
Other operating income, net | (6,387) | (5,080) | |
440,346 | 475,716 | ||
Operating profit | 83,126 | 64,921 | |
Interest expense, net | (31,477) | (34,106) | |
Investment loss, net | (1,718) | — | |
Other income, net | 4,986 | 3,350 | |
Income before income taxes | 54,917 | 34,165 | |
Provision for income taxes | (15,685) | (11,453) | |
Net income | $ 39,232 | $ 22,712 | |
Net income per share: | |||
Basic | $ .20 | $ .12 | |
Diluted | .19 | .12 | |
Number of shares used to calculate basic income per share | 200,643 | 190,293 | |
Number of shares used to calculate diluted income per share | 201,617 | 190,900 | |
The Wendy's Company and Subsidiaries Condensed Consolidated Balance Sheets As of December 28, 2025 and March 29, 2026 (In Thousands Except Par Value) (Unaudited) | |||
December 28, | March 29, | ||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 300,833 | $ 298,740 | |
Restricted cash | 39,207 | 39,295 | |
Accounts and notes receivable, net | 117,333 | 125,055 | |
Inventories | 7,387 | 6,604 | |
Prepaid expenses and other current assets | 55,412 | 73,419 | |
Advertising funds restricted assets | 97,867 | 109,149 | |
Total current assets | 618,039 | 652,262 | |
Properties | 937,795 | 908,478 | |
Finance lease assets | 312,844 | 325,538 | |
Operating lease assets | 642,589 | 611,376 | |
Goodwill | 774,088 | 773,710 | |
Other intangible assets | 1,170,671 | 1,158,395 | |
Investments | 25,227 | 24,499 | |
Net investment in sales-type and direct financing leases | 284,891 | 279,671 | |
Other assets | 190,417 | 190,693 | |
Total assets | $ 4,956,561 | $ 4,924,622 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current liabilities: | |||
Current portion of long-term debt | $ 29,750 | $ 29,750 | |
Current portion of finance lease liabilities | 26,673 | 27,334 | |
Current portion of operating lease liabilities | 51,119 | 52,318 | |
Accounts payable | 30,450 | 23,596 | |
Accrued expenses and other current liabilities | 116,655 | 114,812 | |
Advertising funds restricted liabilities | 96,454 | 108,348 | |
Total current liabilities | 351,101 | 356,158 | |
Long-term debt | 2,730,502 | 2,724,896 | |
Long-term finance lease liabilities | 646,715 | 655,082 | |
Long-term operating lease liabilities | 660,257 | 627,213 | |
Deferred income taxes | 287,753 | 288,492 | |
Deferred franchise fees | 87,956 | 84,426 | |
Other liabilities | 74,894 | 72,804 | |
Total liabilities | 4,839,178 | 4,809,071 | |
Commitments and contingencies | |||
Stockholders' equity: | |||
Common stock, 470,424 shares issued; 190,324 and 190,450 shares outstanding, respectively | 47,042 | 47,042 | |
Additional paid-in capital | 2,986,150 | 2,989,355 | |
Retained earnings | 435,124 | 431,173 | |
Common stock held in treasury, at cost; 280,100 and 279,974 shares, respectively | (3,286,965) | (3,285,255) | |
Accumulated other comprehensive loss | (63,968) | (66,764) | |
Total stockholders' equity | 117,383 | 115,551 | |
Total liabilities and stockholders' equity | $ 4,956,561 | $ 4,924,622 | |
The Wendy's Company and Subsidiaries Condensed Consolidated Statements of Cash Flows Three Month Periods Ended March 30, 2025 and March 29, 2026 (In Thousands) (Unaudited) | |||
Three Months Ended | |||
2025 | 2026 | ||
Cash flows from operating activities: | |||
Net income | $ 39,232 | $ 22,712 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization (exclusive of amortization of cloud computing arrangements shown separately below) | 36,549 | 40,575 | |
Amortization of cloud computing arrangements | 4,167 | 4,762 | |
Share-based compensation | 5,572 | 5,246 | |
Impairment of long-lived assets | 1,421 | 2,572 | |
Deferred income tax | 306 | 956 | |
Non-cash rental expense, net | 10,350 | 10,925 | |
Change in operating lease liabilities | (12,131) | (12,584) | |
Net receipt (recognition) of deferred vendor incentives | 11,178 | (2,535) | |
System optimization losses (gains), net | 90 | (1,625) | |
Distributions received from joint ventures, net of equity in earnings | 717 | 341 | |
Long-term debt-related activities, net | 1,873 | 1,832 | |
Cloud computing arrangements expenditures | (2,417) | (4,157) | |
Changes in operating assets and liabilities and other, net | (11,492) | (9,631) | |
Net cash provided by operating activities | 85,415 | 59,389 | |
Cash flows from investing activities: | |||
Capital expenditures | (17,679) | (11,881) | |
Franchise development fund | (5,813) | (4,580) | |
Dispositions | 55 | 2,796 | |
Notes receivable, net | 1,949 | — | |
Net cash used in investing activities | (21,488) | (13,665) | |
Cash flows from financing activities: | |||
Proceeds from long-term debt | 15,000 | 15,100 | |
Repayments of long-term debt | (15,813) | (22,538) | |
Repayments of finance lease liabilities | (5,238) | (5,970) | |
Repurchases of common stock | (122,784) | — | |
Dividends | (49,432) | (26,648) | |
Proceeds from stock option exercises | 273 | — | |
Payments related to tax withholding for share-based compensation | (1,326) | (423) | |
Net cash used in financing activities | (179,320) | (40,479) | |
Net cash (used in) provided by operations before effect of exchange rate changes on cash | (115,393) | 5,245 | |
Effect of exchange rate changes on cash | 744 | (886) | |
Net (decrease) increase in cash, cash equivalents and restricted cash | (114,649) | 4,359 | |
Cash, cash equivalents and restricted cash at beginning of period | 503,608 | 357,672 | |
Cash, cash equivalents and restricted cash at end of period | $ 388,959 | $ 362,031 | |
The Wendy's Company and Subsidiaries Reconciliations of Net Income to Adjusted EBITDA and Revenues to Adjusted Revenues Three Month Periods Ended March 30, 2025 and March 29, 2026 (In Thousands) (Unaudited) | |||
Three Months Ended | |||
2025 | 2026 | ||
Net income | $ 39,232 | $ 22,712 | |
Provision for income taxes | 15,685 | 11,453 | |
Income before income taxes | 54,917 | 34,165 | |
Other income, net | (4,986) | (3,350) | |
Investment loss, net | 1,718 | — | |
Interest expense, net | 31,477 | 34,106 | |
Operating profit | 83,126 | 64,921 | |
Plus (less): | |||
Advertising funds revenue | (100,360) | (108,341) | |
Advertising funds expense (a) | 100,216 | 108,612 | |
Depreciation and amortization (exclusive of amortization of cloud computing | 36,549 | 40,575 | |
Amortization of cloud computing arrangements | 4,167 | 4,762 | |
System optimization losses (gains), net | 90 | (1,625) | |
Reorganization and realignment costs | (692) | (162) | |
Impairment of long-lived assets | 1,421 | 2,572 | |
Adjusted EBITDA | $ 124,517 | $ 111,314 | |
Revenues | $ 523,472 | $ 540,637 | |
Less: | |||
Advertising funds revenue | (100,360) | (108,341) | |
Adjusted revenues | $ 423,112 | $ 432,296 | |
(a) | Excludes advertising funds expense of |
The Wendy's Company and Subsidiaries Reconciliation of Net Income and Diluted Earnings Per Share to Adjusted Income and Adjusted Earnings Per Share Three Month Periods Ended March 30, 2025 and March 29, 2026 (In Thousands Except Per Share Amounts) (Unaudited) | |||
Three Months Ended | |||
2025 | 2026 | ||
Net income | $ 39,232 | $ 22,712 | |
Plus (less): | |||
Advertising funds revenue | (100,360) | (108,341) | |
Advertising funds expense (a) | 100,216 | 108,612 | |
System optimization losses (gains), net | 90 | (1,625) | |
Reorganization and realignment costs | (692) | (162) | |
Impairment of long-lived assets | 1,421 | 2,572 | |
Total adjustments | 675 | 1,056 | |
Income tax impact on adjustments (b) | (209) | (192) | |
Total adjustments, net of income taxes | 466 | 864 | |
Adjusted income | $ 39,698 | $ 23,576 | |
Diluted earnings per share | $ .19 | $ .12 | |
Total adjustments per share, net of income taxes | .01 | — | |
Adjusted earnings per share | $ .20 | $ .12 | |
(a) | Excludes advertising funds expense of |
(b) | Adjustments relate to the tax effect of non-GAAP adjustments, which were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates. |
The Wendy's Company and Subsidiaries Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Three Month Periods Ended March 30, 2025 and March 29, 2026 (In Thousands) (Unaudited) | |||
Three Months Ended | |||
2025 | 2026 | ||
Net cash provided by operating activities | $ 85,415 | $ 59,389 | |
Plus (less): | |||
Capital expenditures | (17,679) | (11,881) | |
Franchise development fund | (5,813) | (4,580) | |
Advertising funds impact (a) | 6,093 | (6,399) | |
Free cash flow | $ 68,016 | $ 36,529 | |
(a) | Represents the net change in the restricted operating assets and liabilities of our advertising funds, which is included in "Changes in operating assets and liabilities and other, net," and the excess of advertising funds expense over advertising funds revenue, which is included in "Net income." |
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SOURCE The Wendy’s Company