In economically uncertain times with increasingly cautious consumers, Yum China Holdings Inc. (YUMC.US; 9987.HK) defied the broader market in the second quarter, getting creative with new store formats and deploying AI in its customer-facing and back-office operations to boost both its profits and margins.
The operator of KFC and Pizza Hut restaurants in China turned in solid profit growth and margin expansion in its latest quarterly report released on Tuesday, even as many of its peers stumbled amid economic headwinds. The company also continued its breakneck expansion in the massive market during the quarter. Yum China wasn’t completely immune from the headwinds affecting the market, reporting a small decline in same-store sales.
But even that looked like a relative achievement when compared with Starbucks (SBUX.US), which last week reported its China same-store sales tumbled 14% in the three months through June.