In 4Q17, Wendy’s (WEN) posted revenue of $309.3 million, which represents a fall of 0.2% from $309.9 million in 4Q16. Analysts were expecting the company to post revenue of $315.3 million. Wendy’s failed to meet analysts’ revenue estimates due to lower-than-expected SSSG (same-store sales growth), which we’ll look at in the next part of this series.
Analyzing Wendy’s revenue across segments
In 4Q17, Wendy’s company-owned restaurants posted revenue of $154.9 million, which represents a fall of 10.8% from $173.6 million in 4Q16. The segment operated 90 fewer restaurants at the end of 4Q17 compared to the beginning of 4Q16. However, some of the declines were offset by positive SSSG.
Revenue from its franchised restaurants segment has increased 13.2% to $154.4 million in 4Q17, from $136.4 million in 4Q16. The growth in franchise royalty revenue, fees, and rental income due to the addition of new franchised restaurants led to an increase in the segment’s revenue. Compared to the beginning of 4Q16, the segment operated 221 more franchised restaurants at the end of 2017.
In 2017, the company has increased its unit count by 32 restaurants in North America and by 65 restaurants in its international markets.