KFC’s U.S. Turnaround Has a Long Way to Go as International Business Surges

KFC’s efforts to revive its U.S. business are producing encouraging results from individual menu launches, but the chicken chain is still struggling to translate that excitement into sustained sales growth.

The brand’s domestic system sales declined 6 percent in the third quarter. The performance contrasted with KFC’s international operations, where new value platforms, menu innovation, and expansion are driving considerably stronger results.

The domestic business continues to face intense competition from established chicken chains and newer fast-growing concepts. Yum! Brands CEO Chris Turner acknowledged the challenges during the company’s Q3 earnings, noting KFC U.S. is continuing to execute its turnaround strategy.

The chain found some success during the period with the introduction of popcorn chicken, which attracted enough demand to sell out at numerous restaurants. The launch demonstrated KFC’s ability to generate customer interest through familiar products, even as its overall sales struggled. The company also faced a difficult comparison with Q3 2025, when a successful wings-and-wedges promotion contributed to sales performance.

Yum! is pursuing a comprehensive effort to modernize KFC, with initiatives spanning menu innovation, marketing, value, operations, and digital technology.

The company wants KFC to become the world’s most modern chicken QSR brand. Its plans include a refreshed brand identity, a more consistent pipeline of limited-time offers, an everyday value platform, upgraded chicken tenders, additional sauces, and specialty beverages.

Those initiatives are intended to give customers more reasons to visit and improve KFC’s competitiveness in a category where operators have invested aggressively in chicken sandwiches, tenders, and value meals.

A major component of the strategy involves making KFC’s food more distinctive through new flavors and menu combinations. The company sees opportunities to improve its core chicken offerings and introduce products that appeal to different dining occasions.

Beverages are becoming another priority, internationally at least.

KFC’s new Kwench beverage platform has expanded to more than 1,000 restaurants across over 10 international markets, including six of the brand’s 20 largest markets. The program features specialty beverages such as sparkling lemonades, iced coffees, shakes, boba, and matcha, giving KFC an opportunity to attract customers who might not otherwise visit for a traditional chicken meal.

Yum! expects Kwench to reach 2,000 restaurants by the end of 2026, with plans to double that footprint by the end of 2027. Expansion is continuing in Australia and Canada before the platform moves into additional major international markets.

Kwench sales have more than doubled since the initial pilot, and approximately one in five KFC visits in Australia includes a Kwench beverage.

The platform could eventually play a role in KFC’s domestic strategy, although Yum! has not announced a nationwide U.S. rollout.

KFC is also investing in technology to improve service and reduce operational friction.

Yum!’s Byte Kitchen display system is beginning to roll out across the U.S., providing employees with tools to manage kitchen demand and coordinate orders more efficiently.

Early results from the limited number of participating restaurants have been promising. The company reported 8 percent faster drive-thru speeds, a 12 percent reduction in refunds, and a decrease of more than 20 seconds in delivery driver wait times.

Overall, international markets excluding China reported 9 percent system sales growth during the third quarter. Same-store sales increased 4 percent, an improvement from the previous quarter.

In the U.K., same-store sales increased 6 percent, and traffic growth exceeded the quick-service industry by five percentage points. This is the first major market where most elements of KFC’s updated strategy are already in place, including value, product innovation, and operational improvements.

Other international markets are seeing positive results from similar initiatives.

Across seven countries in the Middle East, KFC introduced an everyday value platform called Worth It, supplemented by limited-time products such as Hot Honey and Captain Nacho.

India introduced a $1 burger meal alongside the locally inspired Double Chicken Dynamite. Same-store sales growth accelerated four percentage points in India and six percentage points in the Middle East compared with the previous quarter.

System sales grew 25 percent across the Middle East, Turkey, and North Africa, 20 percent in India, 12 percent in Asia, and 11 percent in Latin America.

Turner pointed to these markets as examples of how KFC can adapt its menu and value offerings to local consumer preferences. The company plans to expand elements of its modernization strategy across KFC’s 20 largest markets through 2027, although the timing and execution will vary by country.

“It will take time. We’ve got 150 countries, so it won’t translate to sales overnight, but this is part of building the brand over time,” Turner said.

KFC’s international momentum is also supporting substantial development.

The brand opened 878 gross new restaurants across 66 countries during the third quarter, bringing its worldwide footprint to 35,421 locations. That represents 7 percent unit growth compared with the previous year.

KFC surpassed 35,000 restaurants less than three years after reaching 30,000, and Yum! expects 2026 to establish another record for international restaurant development.

The company sees significant expansion opportunities in China, India, South Africa, Thailand, Korea, and other international markets where franchisees are achieving attractive restaurant-level returns.

KFC’s global system sales increased 6 percent during the quarter and operating profit rose 8 percent.