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Yum! Brands reported third-quarter earnings that exceeded analyst expectations, driven partly by KFC's global expansion and higher franchise revenue. Taco Bell executives attributed the chain's recovery from a weak quarter to weekly Tuesday deals, loyalty rewards, and limited-time menu items.
Yum! Brands has ended its franchise agreement with Encanto Restaurants, the longtime operator of KFC and Taco Bell locations across Puerto Rico, forcing all stores on the island to close temporarily. Yum! cited Encanto's inability to meet its operating standards, while Encanto has not responded to requests for comment. Both brands say they are searching for a new franchise partner to reopen locations.
Taco Bell has launched a weekly mini-game for rewards members running through Nov. 1, letting players earn 'Paddles' for prize drawings including a signed Davante Adams jersey. The move follows Domino's summer launch of its Soccer Shootout game and Burger King's sweepstakes offering Royal Perks members weekly cash prizes up to $5,000. Smoothie King's earlier spin-to-win games reportedly drew over 2 million plays and boosted loyalty sign-ups by more than 40% in three months, per platform builder PAR Technology.
KFC has signed a new beverage partnership with Coca-Cola that will replace PepsiCo in its U.S. restaurants starting January 2027, with full rollout expected by spring 2027. The switch ends a roughly 40-year relationship that began when PepsiCo owned KFC in 1986 and continued even after Yum Brands spun off from Pepsi in 1997. PepsiCo still retains deals covering Taco Bell and KFC's international locations, including a new 10-year Taco Bell agreement.
Taco Bell and Milk Bar are releasing a Birthday Cake Empanada, combining Milk Bar's signature cake flavor with pink frosting and rainbow sprinkles inside an empanada shell. It arrives nationwide on Oct. 15 for $3.49, marking the brands' third collaboration after Strawberry Bell Truffles in 2022 and Birthday Cake Churros earlier this year. Taco Bell Rewards members can also claim it as a free birthday treat from Oct. 15 through Oct. 28.
Taco Bell's per-location traffic finished down 12.2% year over year from July 6 through Sept. 11, the period spanning the cyclospora outbreak tied to Taylor Farms iceberg lettuce, according to Placer.ai data. The chain had pulled lettuce, cilantro-onion mix and pico de gallo and rolled out $1 promotions on Enchiritos and Mexican Pizzas, but traffic had swung from -18.1% to -30.9% versus its own earlier averages before recovering somewhat.
Major fast-food chains are officially adopting menu items first popularized by customers on social media. IHOP revived its Stuffed French Toast after fan requests and rolled out Dubai Chocolate Pancakes nationwide following a viral test run, while Chipotle launched Chili Lime Chips inspired by customers crushing chips into their bowls. Taco Bell's new 'Fan Style' feature lets loyalty members build and share custom orders, following similar moves by McDonald's and Burger King.
Custom hardware maker Tru Narla has built a compass-like device that ignores magnetic north and instead orients itself toward the nearest Taco Bell location. The project uses GPS and directional hardware, repurposing skills common in cyberpunk-style DIY electronics for a playful, consumer-friendly gadget.
Yum! Brands CFO Ranjith Roy told the Barclays Global Consumer Staples Conference that the recent sale of Pizza Hut shows the company is willing to make aggressive portfolio changes, including potentially adding a new brand if the opportunity fits. He noted the priority remains strengthening current holdings—Taco Bell, KFC and Habit Burger & Grill—before pursuing any acquisition.
Taco Bell has launched a new frozen dessert called the Churro Ice Cream Taco, priced at $3.99. The item features a waffle shell dipped in chocolate and filled with a new churro-flavored ice cream, drawing comparisons to the discontinued Choco Taco. It arrives alongside another frozen menu addition as summer winds down.
Taco Bell has signed an exclusive development agreement with restaurant operator Americana Restaurants to relaunch in the United Arab Emirates, a market it exited without explanation in 2012. The Yum! Brands chain previously ran several locations across the UAE, including in Dubai. Americana's chairman, Mohamed Alabbar, framed the comeback around Taco Bell's brand appeal to younger consumers seeking bold flavors and value.
McDonald's launched a Dragonberry Energizer drink in partnership with Red Bull, and days later Taco Bell countered with three new energy refreshers, according to Restaurant Business. Both fast-food giants are pushing deeper into beverages as customer spending rises and drinks attract new visitors.