The Wendy's Company

What they do

Wendy's operates, develops and franchises quick-service restaurants serving hamburgers, chicken sandwiches, chicken tenders and nuggets, chili, fries, baked potatoes, salads, soft drinks, Frosty desserts and breakfast. As of June 28, 2026, the system had 7,180 restaurants: 5,724 in the U.S. (420 Company-operated and 5,304 franchised by 206 franchisees) and 1,456 internationally in 38 foreign countries and U.S. territories (1,446 franchised by 116 franchisees and 10 Company-operated in the U.K.). Revenue comes from Company-operated restaurant sales and from franchise royalties, fees, national advertising fund collections and rents.

Revenue drivers

• Wendy's U.S. segment — Operates and franchises U.S. restaurants, earning sales at Company-operated locations plus royalties, fees and national advertising fund collections from franchised restaurants; second quarter 2026 U.S. systemwide sales were $2,875.8 million.
• Wendy's International segment — Operates and franchises restaurants outside the U.S., mainly royalties, fees and advertising fund collections from 1,446 franchised international restaurants; second quarter 2026 international systemwide sales were $546.7 million.
• Global Real Estate & Development segment — Earns rent from owned and leased sites leased or subleased to franchisees, includes the Company's share of income from the TimWen Canadian real estate joint venture, and charges fees for facilitating franchisee-to-franchisee restaurant transfers and other development services.
• Franchised restaurant base — At June 28, 2026, 6,750 of 7,180 restaurants were franchisee-operated (5,304 U.S. and 1,446 international), making royalty and franchise fee streams the dominant revenue source relative to the 430 Company-operated restaurants.

Recent performance

For the second quarter ended June 28, 2026, total revenues were $570.6 million, up 1.7% from $560.9 million a year earlier, while adjusted revenues fell 1.4% to $443.2 million. Global systemwide sales declined 6.5% to approximately $3.4 billion, driven by an 8.2% U.S. decline, partly offset by 3.4% international growth. U.S. same-restaurant sales fell 7.0% and international same-restaurant sales fell 2.3%, for a global same-restaurant sales decline of 6.3%. Net income was $32.6 million, adjusted EBITDA was $124.1 million, reported diluted EPS was $0.17 and adjusted EPS was $0.18. Net cash provided by operating activities was $160.0 million and free cash flow $120.3 million for the first half of the year.

Strategy

During 2025 the Company announced Project Fresh, a U.S. plan built on four pillars: brand revitalization, operational excellence, system optimization and capital allocation. Management has since identified five turnaround areas: rebuilding a quality menu at compelling value, marketing that drives demand, operational excellence, a digital experience that builds frequency, and restaurants as an engine for growth. The Company withdrew its 2026 outlook and announced a reduction in its dividend to preserve flexibility for the turnaround and growth plan. Internationally, priorities remain profitable average unit volume growth and sustained net unit growth.

Risks

• Same-restaurant sales decline — U.S. same-restaurant sales fell 7.0% in second quarter 2026 and 7.4% year-to-date, and management stated traffic, value proposition and franchisee economics are not meeting expectations.
• Franchisee-driven unit declines — U.S. restaurant count fell from 5,967 at second quarter 2025 to 5,724 at second quarter 2026, with year-to-date net U.S. openings of negative 245.
• Competitive discounting — The 10-K states many competitors have introduced lower-cost value menu options and use frequent price discounting and significant advertising, and some have substantially greater financial and marketing resources.
• Capital allocation pressure — The Company withdrew 2026 guidance and cut its dividend while carrying $2.72 billion of long-term debt and $4.76 billion of total liabilities against $120.5 million of shareholder equity at June 28, 2026.

Outlook

Management withdrew its 2026 outlook and is formulating a comprehensive turnaround plan under new President and CEO Bob Wright, who returned to Wendy's and said the brand is not performing at its potential. The Company is funding turnaround actions across five areas and updated its capital allocation, including a reduced dividend, to provide flexibility. No forward financial guidance is provided in the excerpted materials.