The Wendy's Company

Adjusted revenue was $443.2 million, down $6.4 million, or 1.4% versus prior year. Adjusted EBITDA was $124.1 million, down $22.5 million year over year, and adjusted earnings per share was $0.18. Global systemwide sales declined 6.5%; U.S. same-restaurant sales fell 7.0% and International same-restaurant sales declined 2.3%. U.S. company-operated restaurant margin was 13.8% and global company-operated restaurant margin was 13.6%. On the traffic side, U.S. traffic decreased 12.5%, while average check increased 5.6%; international systemwide sales grew 3.4%, and ex-Canada international sales grew 8.6%. For the balance of the year, management said it expects continued traffic headwinds, pressure on company-operated margin and adjusted EBITDA, and withdrew its 2026 financial outlook.

Bob Wright framed the quarter as evidence that Wendy’s is underperforming its potential, saying traffic is down, the value proposition has slipped, and franchisee economics are under pressure. His tone was candid but confident: he repeatedly emphasized that the brand’s quality heritage, franchise system and restaurant base remain strong, and said the issues are fixable. Strategically, he highlighted five focus areas and stressed that the plan will be built with urgency, transparency and accountability, with measurable progress tied to traffic, customer satisfaction, franchisee economics and returns on investment.

Steve Cirulis said second-quarter performance fell short of expectations and reflected a need to fully revise the path forward. He cited $443.2 million of adjusted revenue, $124.1 million of adjusted EBITDA, and $0.18 of adjusted EPS, along with U.S. company-operated margin of 13.8%; margin pressure came from about 9% commodity inflation, including beef and product upgrades, plus about 4% labor rate inflation. He also noted $26.0 million invested in capex and restaurant development in the quarter, including $8.3 million for technology and $12.8 million for restaurant development, and $120.3 million of free cash flow in the first half, up $10.8 million year over year. On capital allocation, he said the company announced a quarterly dividend of $0.07 per share, does not anticipate repurchasing shares in 2026, has about $35 million remaining under its buyback authorization, ended the quarter with approximately $380 million in cash and 5.0x net leverage, and expects to refinance about $430 million of debt later this year or in early 2027.

Analysts pressed management on why a turnaround can work now, and Wright pointed to his restaurant experience, prior turnaround work with Steve Cirulis at Potbelly, and what he called a clear diagnosis of the core issues. Questions focused heavily on quality erosion, value architecture, marketing effectiveness, breakfast, closures, restaurant condition, and whether Project Fresh is being continued; Wright said this is Wendy’s own strategy, not a continuation of Project Fresh, and that marketing needs better messaging and brand continuity rather than lower spend. On breakfast, Cirulis said it is about 5% to 5.5% of sales and that opt-outs reduced same-restaurant sales by about 70 basis points, while the daypart overall pressured same-store sales by about 120 basis points. On closures and the system footprint, Wright said additional closures are likely but would be targeted to improve franchisee health rather than programmatic shrinkage.