ZACKSยท2025-08-04 17:31Core Insights - Yum China Holdings, Inc. (YUMC) is set to report its second-quarter 2025 results on August 5, with expectations of adjusted earnings per share (EPS) of $0.57, reflecting a 3.6% increase year-over-year, and total revenues projected at $2.78 billion, indicating a 3.9% growth from the previous year [1][3][10] Financial Performance - In the last reported quarter, YUMC's adjusted earnings fell short of the Zacks Consensus Estimate by 1.3% and decreased 8.5% year-over-year, while total revenues slightly missed the consensus by 4.2% but grew 0.7% from the year-ago quarter [1][2] - YUMC has surpassed earnings estimates in three of the last four quarters, with an average surprise of 8.1% [2] Revenue and Growth Drivers - The anticipated revenue growth in Q2 2025 is attributed to steady same-store transaction growth and new unit expansion, supported by effective strategies and improved value offerings [4][10] - Revenue from KFC is expected to grow by 4.8% to $2.11 billion, while Pizza Hut's revenue is projected to increase by 0.4% to $542 million [5] Cost Management and Profitability - The adjusted operating profit margin is expected to rise by 30 basis points to 10.2%, with adjusted operating profit increasing by 7.1% to $284.9 million [7][10] - Despite challenges from wage inflation and a higher delivery mix, disciplined cost management and margin expansion are expected to enhance profitability [5][10] Earnings Prediction Model - The current model does not predict an earnings beat for YUMC, as it has an Earnings ESP of 0.00% and a Zacks Rank of 2 (Buy) [8][9]