- Same-Store Sales Growth: 3.8% for Q2 2026.
- Net Restaurant Growth: 2.9% for Q2 2026.
- Systemwide Sales Growth: 6.4% for Q2 2026.
- Organic Adjusted Operating Income Growth: 6.7% for Q2 2026.
- Adjusted EPS: $1.07, up 12.9% from $0.94 in the prior year.
- Free Cash Flow: $501 million in Q2, including $62 million of CapEx and cash inducements.
- Capital Returned to Shareholders: $435 million in Q2, including $137 million in share repurchases.
- Net Leverage Ratio: 4.1 times, down from the prior quarter.
- Tim Hortons Canadian Same-Store Sales: Relatively flat at plus 0.1%.
- International Comparable Sales: 5.5% for Q2.
- International Net Restaurant Growth: 5.1% for Q2.
- International Systemwide Sales Growth: 10.7% for Q2.
- Burger King Comparable Sales: 8.6% for Q2.
- Burger King US Same-Store Sales: 8.5% for Q2.
- Burger King Systemwide Sales Growth: 8.2% for Q2.
- Popeyes US Net Restaurant Growth: 0.3% for Q2.
- Popeyes Same-Store Sales: Declined 5.2% for Q2.
- Popeyes Systemwide Sales: Negative 3.3% for Q2.
- Firehouse Subs Systemwide Sales Growth: 7.5% for Q2.
- Firehouse Subs Net Restaurant Growth: 8.1% for Q2.
- Firehouse Subs Comparable Sales Growth: 0.4% for Q2.
- Adjusted Effective Tax Rate: 16.8% for Q2, with year-to-date at 17.6%.
- Total Liquidity: Approximately $2.3 billion, including $1.1 billion of cash.
Release Date: August 06, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Restaurant Brands International Inc QSR delivered strong Q2 results with 3.8% same-store sales growth, 6.4% system-wide sales growth, and 12.9% adjusted EPS growth, exceeding its long-term algorithm for the third consecutive quarter.
- Burger King US was a standout performer, with same-store sales up 8.5%, beating the burger QSR industry by over 9 points, driven by successful brand elevation campaigns and a 20% increase in Whopper platform AUVs.
- The international business continues to be a major growth engine, delivering 5.5% comparable sales and 5.1% net restaurant growth, with strong performance across key markets like Germany, Spain, Brazil, China, Korea, and Japan.
- The company is making significant progress toward its investment-grade leverage goal, receiving a ratings upgrade from S&P to BB+ and reducing its net leverage ratio to 4.1 times.
- Restaurant Brands International Inc (QSR) returned $435 million of capital to shareholders in Q2 through dividends and share repurchases, and remains on track to repurchase approximately $500 million for the full year.
Negative Points
- Tim Hortons' Canadian same-store sales were relatively flat at plus 0.1%, as the marketing calendar failed to drive expected growth and was unable to lap last year's major platform launches.
- Popeyes US experienced a same-store sales decline of 5.2%, which more than offset its modest net restaurant growth, resulting in negative system-wide sales of 3.3%.
- The company faces a $10 million headwind to AOI and a $0.02 to $0.03 headwind to adjusted EPS for the second half of 2026 due to recent currency movements and US dollar appreciation.
- Beef costs remain at all-time highs, impacting franchisee profitability, with significant relief not expected until the beginning of 2027, potentially delaying the pace of restaurant remodels.
- The refranchising process for the Restaurant Holdings segment was slower than expected in Q2, with the company noting that the path will not be entirely linear as it seeks the right buyers.
Q & A Highlights
Q: Burger King delivered an exceptional quarter with 8.6% comparable sales. You mentioned you're still early in your journey. What are the most overlooked drivers you can still unlock to drive more outperformance?
A: CEO Josh Kobza highlighted that while operations and image have improved, many restaurants still lack a modern image, providing a multi-year tailwind. The team is also focused on further elevating the menu beyond the Whopper, with new chapters of culinary innovation planned. Executive Chairman Patrick Doyle added that growth will come from consistently improving the guest experience, with more remodeled restaurants and a refined value layer, rather than relying on a single promotion.
Q: Tim Hortons' Canadian same-store sales were relatively flat at +0.1%. Can you elaborate on the improvement seen through the quarter and the trajectory for the back half of the year?
A: CEO Josh Kobza noted that the macro environment in Canada is stable, and the softness was largely due to a marketing calendar that didn't perform as anticipated. The quarter improved with the return of "Melts" and continued cold beverage growth. Looking ahead, the team is excited about the Harry Potter "Back to Hogwarts" campaign, new breakfast innovations, the Matcha launch, and a loyalty partnership with Canadian Tire, all of which are expected to drive momentum in Q3 and Q4.
Q: The competitive environment in Canada is sharpening. Are you planning to increase the speed of innovation to fend off new entrants, and what are the trade-offs?
A: CEO Josh Kobza acknowledged that QSR markets are always competitive but emphasized that the pace of cold beverage innovation has stepped up, citing the national Matcha launch as an example. Executive Chairman Patrick Doyle expressed high confidence in Tim's, noting the culinary team's strong pipeline and the brand's leadership in value. He stressed that the competitive set in Canada is unlikely to change dramatically and that the company's focus on service, value, and innovation will sustain its leadership.
Q: Can you provide an update on the refranchising process at Burger King and whether the strengthening momentum is enough to accelerate the remodel pace?
A: CFO Sami Siddiqui stated that while Q2 refranchising was slower than expected, the pipeline of potential buyers has more than doubled since Investor Day. The company remains on track to refranchise a few hundred restaurants in 2026 and the remainder in 2027. On remodels, franchisee profitability is still impacted by historically high beef costs, but as those ease in early 2027, the pace of remodels is expected to accelerate. CEO Josh Kobza added that a key focus is ensuring the right, hands-on operators acquire these restaurants to drive long-term success.
Q: Popeyes' turnaround seems to be progressing more slowly than anticipated. What are the key issues, and are you confident in a return to positive comps in the second half?
A: CEO Josh Kobza stated that Popeyes is tracking as expected, with the $5 Faves value platform stabilizing traffic and improved product satisfaction across core SKUs. Operational improvements, including an expanded field team, are taking longer to show results but are moving in the right direction. He reiterated confidence in a return to positive comparable sales in the second half of the year.
Q: Where do you see the strongest returns on investment internationally, and where are the significant opportunities to improve unit economics?
A: CEO Josh Kobza highlighted markets like France, Spain, Japan, and Korea as having strong returns and high AUVs. He noted that Burger King China and India are showing material improvements in unit economics, positioning them for accelerated growth. CFO Sami Siddiqui added that paybacks in the TOP10 growth markets are between four and five years and improving, and that excluding China, international Burger King AUVs are similar to the U.S., with better paybacks.
Q: You reiterated the 8% organic AOI growth algorithm for 2026. Can you make the claim that the 3%-plus portfolio same-store sales growth will be achieved this year?
A: CEO Josh Kobza expressed confidence in the second-half outlook, citing strong first-half performance. He noted that the business is on track, with Burger King's momentum, Tim Hortons' improving calendar, and Popeyes' expected return to positive comps, all supporting the full-year algorithm.
Q: In the U.S., where is pricing or check running as part of your comps, and are you seeing any changes in franchisee compliance on pricing?
A: CEO Josh Kobza stated that the company is being disciplined on menu pricing, with increases running in the low single-digits. Despite beef inflation, the focus remains on providing value through platforms like $5 duos and $7 trios. CFO Sami Siddiqui added that the mix has been healthy, with more full-price Whoppers sold, and franchisees are supportive of the value-focused formula as they see the benefits in their P&Ls.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
