Wendy's Co Q1 FY2025 earnings call

• Strategic pillars: Focus on fresh, famous food (using domestic ingredients, innovation via collaborations like Thin Mint Frosty with Girl Scouts), exceptional customer experience (operational vision 'Model of Excellence', technology investments like digital menu boards and AI order-taking), and accelerating net unit growth (opened 74 new restaurants globally, over 60% internationally).
• 100 Days of Summer campaign: Launched with value offerings, collaborations (e.g., Takis meal), and digital app deals.
• Operational improvements: Doubled in-restaurant visits, rolled out new field structure, deployed digital menu boards and AI, enhanced app personalization and gamification.

Global same restaurant sales declined 2.1%, leading to a 1.1% decline in global systems sales. In the U.S., same restaurant sales were down 2.8% and system-wide sales down 2.6% due to adverse weather and a weaker consumer environment. Internationally, same restaurant sales grew 2.3% and system-wide sales grew 8.9%. Revenue contribution: U.S. segment was impacted by the weak consumer and weather, while international showed strong growth.

• Full-year global system wide sales expected to be flat to down 2%.
• Adjusted EBITDA projected between $530 million and $545 million.
• Adjusted EPS expected to range from $0.92 to $0.98 per share.
• Reaffirmed global net unit growth target of 2% to 3%.

• Consumer environment challenges impacting sales.
• Adverse weather affecting traffic and sales in the U.S.
• Competition in the quick-service restaurant space potentially affecting market share.

Q: Jeffrey Bernstein asked about tempering guidance after Q1 and quick service positioning.

A: Kirk Tanner said consumer is under pressure, but they have a balanced approach with 100 Days of Summer, core innovation, and value offerings.

Q: David Palmer asked about consumer data and improvement areas.

A: Kirk Tanner mentioned focus on accuracy (delivery scales, label printers), friendliness, and hospitality, with early improvements seen.

Q: Dennis Geiger asked about unit development outlook.

A: Kirk Tanner said they're on track with 60%+ international openings, confident in pipeline and franchisee demand.

Q: Jon Tower asked about Q1 performance details.

A: Kirk Tanner explained noisy quarter with weather and consumer pullback, broad-based pressure, and Breakfast performing worse.

Q: Sara Senatore asked about advertising spend and burger traffic.

A: Ken Cook said QSR burger traffic was down mid-single digit in Q1, and advertising spend didn't significantly impact share.

Q: Brian Bittner asked about LTOs and converting successes.

A: Kirk Tanner talked about balanced approach, customer focus, and upcoming collaborations like Takis.

Q: James Salera asked about value offerings and collaborations.

A: Kirk Tanner said collaborations ignite passion and drive traffic, not overshadowed by deep discounting.

Q: Lauren Silberman asked about cadence of comps.

A: Ken Cook said Q2 likely similar to Q1, with momentum in Q3 and Q4 due to programming.

Q: Margaret Binshtok asked about Frosty platform.

A: Kirk Tanner said early results on Frosty Swirls and Fusions are encouraging, driving traffic.

Q: Andrew Charles asked about chicken portfolio and $4 million claim.

A: Kirk Tanner said plans to revamp chicken menu, Ken Cook explained $4 million claim settlement was expected.

Q: Danilo Gargiulo asked about franchisee cash flows.

A: Ken Cook talked about P&L benchmarking tool for franchisees.

Q: Rahul Krotthapalli asked about U.S. unit development.

A: Kirk Tanner said they're accelerating initiatives, with international firing on all cylinders.

Q: Christopher O’Cull asked about fresh AI impacts.

A: Kirk Tanner said fresh AI drives increased check size, accuracy, and efficiency.

Q: Brian Mullan asked about breakfast innovation.

A: Kirk Tanner said innovating on beverage platform and coffee lineup for breakfast.

Q: Brian Harbour asked about share shifting.

A: Kirk Tanner said they're focused on winning with 100 Days of Summer and core strategies