Financial Data and Key Metrics Changes - Core operating profit increased by 8% in Q1 2025, reaching $586 million, driven by strong performance from Taco Bell U.S. and KFC International [5][30] - System sales grew by 5%, with same store sales growth of 3% and unit growth of 3% [30] - Reported EPS was $0.90, with an unfavorable tax impact of $0.33 [33] Business Line Data and Key Metrics Changes - Taco Bell U.S. achieved a 9% increase in same store sales and an 11% increase in system sales, with a 16% increase in operating profit [7][17] - KFC International posted low single-digit traffic growth and 5% system sales growth, with a 9% increase in operating profit [10][15] - Pizza Hut experienced a 3% decline in system sales, primarily due to underperformance in the U.S., although international markets showed positive same store sales [19][20] Market Data and Key Metrics Changes - KFC International's same store sales growth was 3%, with notable performance in Canada (6%) and Korea (13%) [16][58] - Taco Bell's digital sales mix reached 42%, with a year-over-year growth of 37% [18][32] - Pizza Hut U.S. faced intense competition but saw sequential gains in revenue and transactions towards the end of Q1 [20][21] Company Strategy and Development Direction - The company is focused on leveraging AI technology through its digital platform, Byte by Yum!, to enhance consumer experiences and operational efficiency [5][24] - Taco Bell is expanding its product offerings and digital channels, aiming for a 10% increase in average unit volumes by 2030 [8] - KFC is modernizing its brand through menu upgrades and innovative partnerships, while also focusing on value-driven offerings [15][58] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business model despite economic uncertainties, highlighting Taco Bell's position as a value leader [46][47] - The company anticipates an 8% core operating profit growth for 2025, with expectations for stronger performance in the second half of the year [48][62] - Management noted that the geopolitical environment has not negatively impacted consumer behavior towards KFC [56] Other Important Information - The company hosted a global franchise convention, showcasing strong franchisee engagement and commitment to growth [26][38] - Yum! Brands received the Corporate Responsibility Award for integrating responsible business practices into its core strategies [28] - The company is planning to expand its innovative beverage concepts, such as Quench by KFC and Live Mas Cafe by Taco Bell [12][18] Q&A Session Summary Question: Concerns about KFC International's performance amid geopolitical dynamics - Management reassured that KFC International's same store sales growth is widespread and not negatively impacted by geopolitical issues, with strong performance in various markets [56][58] Question: Confidence in full-year guidance and profit growth acceleration - Management expressed confidence in achieving 8% core operating profit growth, citing strong Q1 performance and favorable profit laps expected in the second half [62] Question: Store development outlook amid macroeconomic challenges - Management indicated strong confidence in the development plan, with franchisees optimistic about future growth despite global complexities [66][68] Question: Potential of Byte technology and its future applications - Management highlighted the significant investment in digital technology and the potential for Byte to enhance operational efficiency and profitability across the system [74][75] Question: Sustainability of Taco Bell's strong performance - Management noted that Taco Bell's strong sales trends are expected to continue, driven by innovative offerings and value propositions [96]