MW Wendy's says U.S. sales were weak, because people were confused by too many promotions

By Steve Gelsi

CEO Ken Cook to focus its 'Meal of Misfortune' promotion based on the Netflix series 'Wednesday,' and will introduce new chicken offerings to boost sales

Wendy's is launching its "Meal of Misfortune" with Season 2 of the Netflix show "Wednesday."

Wendy's Co.'s stock turned higher on Friday, as investors seemed to approve of the company's plan to turnaround its U.S. business, which includes a focus on its "Meal of Misfortune" promotion, which coincided with the Season 2 premier of the Netflix show "Wednesday."

Interim Chief Executive Ken Cook said on the post-earnings call with analysts that he believes a big reason for weak U.S. sales in the first half of the year was that Wendy's $(WEN)$ had been confusing customers with too many special offers at once.

"When I walked up to a Wendy's and I have seen eight different deals at point of purchase, I wasn't sure what I was coming for," Cook said, according to an AlphaSense transcript.

The company now plans to streamline its promotional efforts, which Cook believes will deliver more impact.

"We can't throw more programming at our restaurants or our customers than what we have the capacity to deliver with excellence," said Cook. who stepped into the lead role at Wendy's on July 8, after Kirk Tanner left to become chief executive of Hershey Co. $(HSY)$.

He said later this year, the focus will be simple, new chicken and beverage offerings.

The stock rose 0.4% in afternoon trading, reversing a post-earnings, premarket loss of as much as 6.7%. It has now gained 1.8% since it closed at a five-year low of $9.82 on Aug. 4.

Wendy's has been hurt by price-wary consumers and competitive pressure from value offerings from rivals such as McDonald's Corp. $(MCD)$. The stock has tumbled 38.7% in 2025 while McDonald's shares have gained 5.2%. So investors are happy to see a plan for anything that might boost sales, particularly in the U.S., where sales have been falling while overseas sales have been rising.

For the second quarter to June 29, Wendy's reported overall sales that fell 1.8% from a year ago, as U.S. sales dropped 3.3% to offset an 8.7% jump in international sales.

Same-restaurant sales, which are sales at restaurants open at least 15 months, declined 2.9%, worse than the FactSet consensus estimate for a drop of 2.2%. Within that drop, same-store sales fell 3.6% in the U.S. but rose 1.8% overseas. That contrasts with McDonald's, which saw U.S. comparable sales rise 2.5% in the same quarter.

Wendy's said its decline in U.S. same-store sales was driven by a decrease in traffic, partially offset by a higher average check.

In the previous quarter, U.S. sales were down 2.6%, while same-restaurant sales fell 2.8%.

Net income rose to $55.1 million from $54.6 million, and earnings per share grew to 29 from 27 cents and beat the average analyst estimate compiled by FactSet of 25 cents.

Looking ahead, Wendy's now expects 2025 adjusted earnings per share, which excludes nonrecurring items, of 82 cents a share to 89 cents a share, down from its previous estimate of 92 cents a share to 98 cents a share.

The company also cut its sales-growth guidance to a decline of 5% to a decline of 3% from a decline of 2% to flat.

Lessons from its 100 Days of Summer promotion

Cook said the company took a hard look at its 100 Days of Summer promotion, which had mixed results.

The company's Frosty shakes sales rose 30% year-over-year in the second quarter, which was in line with expectations, but other efforts such as its $3 on Baconator burger and $1 drinks at breakfast "did not drive the incremental sales lift that we had expected," Cook said.

Its flavor promotion behind the popular Takis chip brand and Wendy's spicy chicken sandwich started with a strong first week and then fell.

Wendy's has since moved some product launches out of the second half of 2025 and into 2026, and shelved some of its $1 promotion efforts.

In the fourth quarter, it plans to launch new chicken tenders and a freshened sauce lineup with "100% white meat coated in light, crispy, and flavorful breading," Cook said.

-Steve Gelsi

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August 08, 2025 14:07 ET (18:07 GMT)

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