Yum Brands is considering selling Pizza Hut, launching a formal review of strategic options for the iconic pizza chain amid intensifying competition and declining sales in the U.S. market.
The company said the move comes as Pizza Hut continues to struggle in a crowded pizza segment, even as sister brands KFC and Taco Bell deliver strong growth. “Pizza Hut’s performance indicates the need to take additional action to help the brand realize its full value, which may be better executed outside of Yum Brands,” CEO Chris Turner said.
Pizza Hut operates nearly 20,000 restaurants across more than 100 countries, with international sales rising 2% in the first nine months of the year. China remains its second-largest market. However, the U.S., which accounts for nearly half the brand’s business, continues to weigh on performance, with domestic sales down 7% during the same period.
The chain has been working to modernize its model after lagging behind rivals in shifting from dine-in to delivery and takeaway formats. A major franchisee bankruptcy in 2020 led to the closure of 300 U.S. stores. Pizza Hut’s U.S. market share has slipped to 15.5% from 19.4% in 2019, according to Technomic.
Yum Brands, which also owns Habit Burger Grill, reported an 8% rise in third-quarter revenue driven by strong performances from KFC and Taco Bell. Shares of Yum rose nearly 7% following the announcement of the strategic review.
Founded in 1958 in Wichita, Kansas, Pizza Hut grew into a global household name and was once the world’s largest pizza chain by sales. It was acquired by PepsiCo in 1977 before becoming part of Yum Brands in 1997. Domino’s has since surged ahead, now operating more than 21,000 stores globally.
Yum has not set a deadline for the review and said it will refrain from further comment until it concludes.
The move follows a wave of restructuring in the U.S. restaurant industry, including the recent sale of fellow mid-century dine-in chain Denny’s to a private investor group, signaling shifting consumer habits and heightened competition across the dining landscape.