What changed in this filing

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Item 1. Financial Statements

2025-08-08 compared with 2025-05-02 · 216 added, 132 removed, 547 unchanged (39% of the section changed)

57 unchanged sentences

(In Thousands Except Per Share Amounts)

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Sales $ 232,853 $ 237,355 $ 452,363 $ 462,678

11 unchanged sentences

Amortization of cloud computing arrangements 4,056 3,519 8,223 7,061

System optimization losses, net 90 127

System optimization gains, net ( 387 ) ( 280 ) ( 297 ) ( 153 )

Reorganization and realignment costs 174 2,452 ( 518 ) 8,125

4 unchanged sentences

Interest expense, net ( 30,945 ) ( 30,995 ) ( 62,422 ) ( 61,530 )

Investment loss, net ( 1,718 ) —

Investment income (loss), net — 11 ( 1,718 ) 11

Other income, net 2,585 6,300 7,571 13,136

2 unchanged sentences

Net income $ 55,110 $ 54,643 $ 94,342 $ 96,636

Net income per share:

Basic $ .20 $ .20

Diluted $ .19 $ .20

Basic and diluted net income per share $ .29 $ .27 $ .48 $ .47

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(In Thousands)

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Net income $ 55,110 $ 54,643 $ 94,342 $ 96,636

21 unchanged sentences

Balance at March 30, 2025 $ 47,042 $ 2,984,865 $ 389,481 $ ( 3,218,308 ) $ ( 72,841 ) $ 130,239

Net income — — 55,110 — — 55,110

Other comprehensive income — — — — 10,305 10,305

Cash dividends — — ( 26,811 ) — — ( 26,811 )

Repurchases of common stock — — — ( 62,558 ) — ( 62,558 )

Share-based compensation — 5,132 — — — 5,132

Common stock issued upon exercises of stock options

— ( 245 ) — 1,689 — 1,444

Common stock issued upon vesting of restricted shares

— ( 1,504 ) — 1,476 — ( 28 )

Other — 17 ( 15 ) 53 — 55

Balance at June 29, 2025 $ 47,042 $ 2,988,265 $ 417,765 $ ( 3,277,648 ) $ ( 62,536 ) $ 112,888

See accompanying notes to condensed consolidated financial statements.

THE WENDY’S COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY—CONTINUED

(In Thousands)

Stock Additional

Capital Retained Earnings Common Stock Held in Treasury Accumulated Other Comprehensive Loss Total

Balance at December 31, 2023 $ 47,042 $ 2,960,035 $ 409,863 $ ( 3,048,786 ) $ ( 58,375 ) $ 309,779

10 unchanged sentences

Balance at March 31, 2024 $ 47,042 $ 2,962,241 $ 400,465 $ ( 3,053,133 ) $ ( 62,961 ) $ 293,654

Net income — — 54,643 — — 54,643

Other comprehensive loss — — — — ( 2,011 ) ( 2,011 )

Cash dividends — — ( 51,252 ) — — ( 51,252 )

Repurchases of common stock — — — ( 27,493 ) — ( 27,493 )

Share-based compensation — 5,824 — — — 5,824

Common stock issued upon exercises of stock options

— ( 134 ) — 874 — 740

Common stock issued upon vesting of restricted shares

— ( 3,484 ) — 3,058 — ( 426 )

Other — 32 ( 20 ) 62 — 74

Balance at June 30, 2024 $ 47,042 $ 2,964,479 $ 403,836 $ ( 3,076,632 ) $ ( 64,972 ) $ 273,753

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(In Thousands)

Three Months Ended

2025 March 31,

Six Months Ended

2025 June 30,

Cash flows from operating activities:

11 unchanged sentences

Net receipt of deferred vendor incentives 8,421 5,533

System optimization losses, net 90 127

System optimization gains, net ( 297 ) ( 153 )

Distributions received from joint ventures, net of equity in earnings 1,679 1,146

18 unchanged sentences

Net cash used in financing activities ( 272,687 ) ( 162,382 )

Net cash (used in) provided by operations before effect of exchange rate changes on cash ( 115,393 ) 6,544

Net cash used in operations before effect of exchange rate changes on cash ( 178,943 ) ( 60,877 )

Effect of exchange rate changes on cash 5,437 ( 3,298 )

Net (decrease) increase in cash, cash equivalents and restricted cash ( 114,649 ) 4,270

Net decrease in cash, cash equivalents and restricted cash ( 173,506 ) ( 64,175 )

Cash, cash equivalents and restricted cash at beginning of period 503,608 588,816

6 unchanged sentences

The accompanying unaudited condensed consolidated financial statements (the “Financial Statements”) of The Wendy’s Company (“The Wendy’s Company” and, together with its subsidiaries, the “Company,” “we,” “us” or “our”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and, therefore, do not include all information and footnotes required by GAAP for complete financial statements.

In our opinion, the Financial Statements contain all adjustments of a normal recurring nature necessary to present fairly our financial position as of March 30, 2025, the results of our operations for the three months ended March 30, 2025 and March 31, 2024 and cash flows for the three months ended March 30, 2025 and March 31, 2024.

The results of operations for the three months ended March 30, 2025 are not necessarily indicative of the results to be expected for the full 2025 fiscal year.

In our opinion, the Financial Statements contain all adjustments of a normal recurring nature necessary to present fairly our financial position as of June 29, 2025, the results of our operations for the three and six months ended June 29, 2025 and June 30, 2024 and cash flows for the six months ended June 29, 2025 and June 30, 2024.

The results of operations for the six months ended June 29, 2025 are not necessarily indicative of the results to be expected for the full 2025 fiscal year.

The Financial Statements should be read in conjunction with the audited consolidated financial statements for The Wendy’s Company and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024 (the “Form 10-K”).

4 unchanged sentences

We report on a fiscal year consisting of 52 or 53 weeks ending on the Sunday closest to or on December 31.

All three-month periods presented herein contain 13 weeks.

All three- and six-month periods presented herein contain 13 weeks and 26 weeks, respectively.

All references to years, quarters and months relate to fiscal periods rather than calendar periods.

3 unchanged sentences

Wendy’s International Global Real Estate & Development Total

Three Months Ended March 30, 2025

Three Months Ended June 29, 2025

Sales at Company-operated restaurants $ 225,973 $ 6,880 $ — $ 232,853

4 unchanged sentences

Total revenues $ 461,142 $ 38,850 $ 60,937 $ 560,929

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Sales at Company-operated restaurants $ 231,151 $ 6,204 $ — $ 237,355

7 unchanged sentences

(In Thousands Except Per Share Amounts)

Wendy’s International Global Real Estate & Development Total

Six Months Ended June 29, 2025

Sales at Company-operated restaurants $ 438,717 $ 13,646 $ — $ 452,363

Franchise royalty revenue 217,248 36,660 — 253,908

Franchise fees 41,676 4,655 1,209 47,540

Franchise rental income — — 118,865 118,865

Advertising funds revenue 193,115 18,610 — 211,725

Total revenues $ 890,756 $ 73,571 $ 120,074 $ 1,084,401

Six Months Ended June 30, 2024

Sales at Company-operated restaurants $ 450,619 $ 12,059 $ — $ 462,678

Franchise royalty revenue 226,850 35,148 — 261,998

Franchise fees 35,652 4,278 2,242 42,172

Franchise rental income — — 118,624 118,624

Advertising funds revenue 202,317 17,691 — 220,008

Total revenues $ 915,438 $ 69,176 $ 120,866 $ 1,105,480

Contract Balances

The following table provides information about receivables and contract liabilities (deferred franchise fees) from contracts with customers:

March 30, 2025 (a) December 29, 2024 (a)

2025 (a) December 29, 2024 (a)

Receivables, which are included in “Accounts and notes receivable, net” (b)

6 unchanged sentences

(b) Includes receivables related to “Sales” and “Franchise royalty revenue and fees.”

(c) Deferred franchise fees are included in “Accrued expenses and other current liabilities” and “Deferred franchise fees” and totaled $ 10,944 and $ 88,057 , respectively, as of March 30, 2025, and $ 11,024 and $ 88,387 , respectively, as of December 29, 2024.

(c) Deferred franchise fees are included in “Accrued expenses and other current liabilities” and “Deferred franchise fees” and totaled $ 11,001 and $ 88,396 , respectively, as of June 29, 2025, and $ 11,024 and $ 88,387 , respectively, as of December 29, 2024.

Significant changes in deferred franchise fees are as follows:

Three Months Ended

2025 March 31,

Six Months Ended

2025 June 30,

Deferred franchise fees at beginning of period $ 99,411 $ 100,805

3 unchanged sentences

Deferred franchise fees at end of period $ 99,397 $ 100,008

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Anticipated Future Recognition of Deferred Franchise Fees

5 unchanged sentences

(a) Represents franchise fees expected to be recognized for the remainder of 2025, which includes development-related franchise fees expected to be recognized over a duration of one year or less.

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Nature of Leases

2 unchanged sentences

The Company also leases restaurant, office and transportation equipment.

As of March 30, 2025, the nature of restaurants operated by the Company and its franchisees was as follows:

As of June 29, 2025, the nature of restaurants operated by the Company and its franchisees was as follows:

Company-operated restaurants:

9 unchanged sentences

Total Company-operated and franchisee-operated restaurants 7,334

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Company as Lessee

The components of lease cost are as follows:

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Finance lease cost:

8 unchanged sentences

_______________

(a) Includes expenses for executory costs of $ 10,394 and $ 10,221 for the three months ended March 30, 2025 and March 31, 2024, respectively, for which the Company is reimbursed by sublessees.

(b) Includes $ 30,652 and $ 31,718 for the three months ended March 30, 2025 and March 31, 2024, respectively, recorded to “Franchise rental expense” for leased properties that are subsequently leased to franchisees.

Also includes $ 6,941 and $ 7,388 for the three months ended March 30, 2025 and March 31, 2024, respectively, recorded to “Cost of sales” for leases for Company-operated restaurants.

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

(a) Includes expenses for executory costs of $ 10,578 and $ 10,033 for the three months ended June 29, 2025 and June 30, 2024, respectively, and $ 20,972 and $ 20,254 for the six months ended June 29, 2025 and June 30, 2024, respectively, for which the Company is reimbursed by sublessees.

(b) Includes $ 32,569 and $ 32,355 for the three months ended June 29, 2025 and June 30, 2024, respectively, and $ 63,221 and $ 64,073 for the six months ended June 29, 2025 and June 30, 2024, respectively, recorded to “Franchise rental expense” for leased properties that are subsequently leased to franchisees.

Also includes $ 6,946 and $ 7,402 for the three months ended June 29, 2025 and June 30, 2024, respectively, and $ 13,887 and $ 14,790 for the six months ended June 29, 2025 and June 30, 2024, respectively, recorded to “Cost of sales” for leases for Company-operated restaurants.

Company as Lessor

The components of lease income are as follows:

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Sales-type and direct-financing leases:

Selling loss $ ( 11 ) $ ( 16 )

Selling profit $ 34 $ 88 $ 23 $ 72

Interest income (a) 6,943 7,178 13,858 14,897

4 unchanged sentences

(a) Included in “Interest expense, net.”

(b) Includes sublease income of $ 42,784 and $ 42,783 recognized during the three months ended March 30, 2025 and March 31, 2024, respectively.

Sublease income includes lessees’ variable payments to the Company for executory costs of $ 10,197 and $ 10,089 for the three months ended March 30, 2025 and March 31, 2024, respectively.

(b) Includes sublease income of $ 44,667 and $ 45,049 recognized during the three months ended June 29, 2025 and June 30, 2024, respectively, and $ 87,451 and $ 87,832 for the six months ended June 29, 2025 and June 30, 2024, respectively.

Sublease income includes lessees’ variable payments to the Company for executory costs of $ 10,512 and $ 10,155 for the three months ended June 29, 2025 and June 30, 2024, respectively, and $ 20,709 and $ 20,244 for the six months ended June 29, 2025 and June 30, 2024, respectively.

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

(4) Investments

8 unchanged sentences

Such investment is accounted for using the equity method, under which our results of operations include our share of the income of the investee in “Other operating income, net.”

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Presented below is activity related to our investment in TimWen included in our condensed consolidated financial statements:

Three Months Ended

2025 March 31,

Six Months Ended

2025 June 30,

Balance at beginning of period $ 27,288 $ 32,727

3 unchanged sentences

Foreign currency translation adjustment included in “Other comprehensive income (loss)”

1,483 ( 1,118 )

Balance at end of period $ 27,092 $ 30,463

2 unchanged sentences

Other Investments in Equity Securities

During the three months ended March 30, 2025, the Company recorded an impairment charge of $ 1,718 for the difference between the estimated fair value and the carrying value of an investment in equity securities.

As a result, the carrying value of the investment was reduced to zero as of March 30, 2025.

During the six months ended June 29, 2025, the Company recorded an impairment charge of $ 1,718 for the difference between the estimated fair value and the carrying value of an investment in equity securities.

As a result, the carrying value of the investment was zero as of June 29, 2025.

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

(5) Long-Term Debt

22 unchanged sentences

Total long-term debt $ 2,650,907 $ 2,662,130

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Other Long-Term Debt

1 unchanged sentence

Borrowings under the line of credit are guaranteed by Wendy’s.

During the three months ended March 30, 2025, the Company drew down $ 15,000 under the revolving line of credit, of which the Company repaid $ 8,500 in March 2025.

As a result, as of March 30, 2025, the Company had outstanding borrowings of $ 6,500 under the revolving line of credit, which is included in “Advertising funds restricted liabilities.”

During the three months ended March 30, 2025, the Company borrowed and repaid $ 15,000 and $ 8,500 , respectively, under the revolving line of credit.

During the three months ended June 29, 2025, the Company borrowed an additional $ 8,500 under the revolving line of credit.

As a result, as of June 29, 2025, the Company had outstanding borrowings of $ 15,000 under the revolving line of credit, which is included in “Advertising funds restricted liabilities.”

(6) Fair Value Measurements

9 unchanged sentences

The inputs into the determination of fair value require significant management judgment or estimation.

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Financial Instruments

19 unchanged sentences

_______________

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

(a) The fair value of our other investments in equity securities is based on our review of information provided by the investment manager, which is based on observable price changes in orderly transactions for a similar investment of the same issuer.

3 unchanged sentences

Our cash equivalents are the only financial assets measured and recorded at fair value on a recurring basis.

THE WENDY’S COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands Except Per Share Amounts)

Non-Recurring Fair Value Measurements

16 unchanged sentences

(7) Income Taxes

The Company’s effective tax rate for the three months ended March 30, 2025 and March 31, 2024 was 28.6 % and 26.9 %, respectively.

The Company’s effective tax rate for the three months ended June 29, 2025 and June 30, 2024 was 27.4 % and 27.0 %, respectively.

The Company’s effective tax rate varied from the U.S.

federal statutory rate of 21 % for the three months ended March 30, 2025 primarily due to state income taxes and the tax effects of our foreign operations.

federal statutory rate of 21 % for the three months ended June 29, 2025 primarily due to state income taxes and the tax effects of our foreign operations and share-based compensation.

The Company’s effective tax rate for the six months ended June 29, 2025 and June 30, 2024 was 27.9 % and 26.9 %, respectively.

The Company’s effective tax rate varied from the U.S.

federal statutory rate of 21 % for the six months ended June 29, 2025 primarily due to state income taxes and the tax effects of our foreign operations.

Subsequent to the end of the second quarter of 2025, on July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted.

Key provisions include the permanent extension of several business tax incentives originally established under the 2017 Tax Cuts and Jobs Act, as well as changes to provisions related to bonus depreciation, and research and development.

The Company is currently evaluating the impact of the OBBBA on our condensed consolidated financial statements.

THE WENDY’S COMPANY AND SUBSIDIARIES

3 unchanged sentences

The calculation of basic and diluted net income per share was as follows:

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Net income $ 55,110 $ 54,643 $ 94,342 $ 96,636

2 unchanged sentences

Dilutive effect of stock options and restricted shares

765 1,266 870 1,433

Weighted average diluted shares outstanding 192,714 206,185 197,166 206,578

Net income per share:

Basic $ .20 $ .20

Diluted $ .19 $ .20

Basic net income per share for the three months ended March 30, 2025 and March 31, 2024 was computed by dividing net income amounts by the weighted average number of shares of common stock outstanding.

Basic and diluted net income per share $ .29 $ .27 $ .48 $ .47

Basic net income per share for the three and six months ended June 29, 2025 and June 30, 2024 was computed by dividing net income amounts by the weighted average number of shares of common stock outstanding.

Diluted net income per share was computed by dividing net income by the weighted average number of basic shares outstanding plus the potential common share effect of dilutive stock options and restricted shares.

We excluded potential common shares of 8,288 and 6,789 for the three months ended March 30, 2025 and March 31, 2024, respectively, from our diluted net income per share calculation as they would have had anti-dilutive effects.

We excluded potential common shares of 7,990 and 8,139 for the three and six months ended June 29, 2025, respectively, and 7,606 and 7,197 for the three and six months ended June 30, 2024, respectively, from our diluted net income per share calculation as they would have had anti-dilutive effects.

(9) Stockholders’ Equity

During both the first quarter of 2025 and the first quarter of 2024, the Company paid dividends per share of $ .25 .

During the first and second quarter of 2025, the Company paid dividends per share of $ .25 and $ .14 , respectively.

During each of the first and second quarters of 2024, the Company paid dividends per share of $ .25 .

Repurchases of Common Stock

In January 2023, our Board of Directors authorized a repurchase program for up to $ 500,000 of our common stock through February 28, 2027, when and if market conditions warrant and to the extent legally permissible (the “January 2023 Authorization”).

During the three months ended March 30, 2025, the Company repurchased 8,182 shares under the January 2023 Authorization with an aggregate purchase price of $ 124,070 , of which $ 1,401 was accrued as of March 30, 2025, and excluding excise tax of $ 1,214 and commissions of $ 115 .

As of March 30, 2025, the Company had $ 110,930 of availability remaining under the January 2023 Authorization.

Subsequent to March 30, 2025 through April 25, 2025, the Company repurchased 3,843 shares under the January 2023 Authorization with an aggregate purchase price of $ 50,895 , excluding applicable excise tax and commissions.

During the three months ended March 31, 2024, the Company repurchased 392 shares under the January 2023 Authorization with an aggregate purchase price of $ 7,187 , of which $ 470 was accrued as of March 31, 2024, and excluding excise tax of $ 24 and commissions of $ 5 .

During the six months ended June 29, 2025, the Company repurchased 12,957 shares under the January 2023 Authorization with an aggregate purchase price of $ 185,962 , of which $ 193 was accrued as of June 29, 2025, and excluding excise tax of $ 1,813 and commissions of $ 182 .

During the six months ended June 29, 2025, the Company paid $ 565 in excise tax on shares repurchased during 2024.

As of June 29, 2025, the Company had $ 49,038 of availability remaining under the January 2023 Authorization.

Subsequent to June 29, 2025 through August 1, 2025, the Company repurchased 834 shares under the January 2023 Authorization with an aggregate purchase price of $ 8,825 , excluding applicable excise tax and commissions.

During the six months ended June 30, 2024, the Company repurchased 1,955 shares under the January 2023 Authorization with an aggregate purchase price of $ 34,448 , of which $ 801 was accrued as of June 30, 2024, and excluding excise tax of $ 233 and commissions of $ 28 .

THE WENDY’S COMPANY AND SUBSIDIARIES

3 unchanged sentences

The following table provides a rollforward of accumulated other comprehensive loss, which is entirely comprised of foreign currency translation:

Three Months Ended

2025 March 31,

Six Months Ended

2025 June 30,

Balance at beginning of period $ ( 74,753 ) $ ( 58,375 )

2 unchanged sentences

Balance at end of period $ ( 62,536 ) $ ( 64,972 )

(10) System Optimization Losses, Net

(10) System Optimization Gains, Net

The Company’s system optimization initiative included a shift from Company-operated restaurants to franchised restaurants over time, through acquisitions and dispositions, as well as facilitating franchisee-to-franchisee restaurant transfers (“Franchise Flips”).

As of March 30, 2025, Company-operated restaurant ownership was approximately 5 % of the total system.

As of June 29, 2025, Company-operated restaurant ownership was approximately 5 % of the total system.

While the Company has no plans to move its ownership away from approximately 5 % of the total system, the Company expects to continue to optimize the Wendy’s system through Franchise Flips, as well as evaluating strategic acquisitions of franchised restaurants and strategic dispositions of Company-operated restaurants to existing and new franchisees, to further strengthen the franchisee base and drive new restaurant development.

During the three months ended March 30, 2025, the Company did not facilitate any Franchise Flips.

During the three months ended March 31, 2024, the Company facilitated 11 Franchise Flips.

Additionally, during the three months ended March 30, 2025, the Company completed the sale of two Company-operated restaurants to franchisees.

No Company-operated restaurants were sold to or purchased from franchisees during the three months ended March 31, 2024.

Gains and losses recognized on dispositions are recorded to “System optimization losses, net” in our condensed consolidated statements of operations.

During the six months ended June 29, 2025 and June 30, 2024, the Company facilitated one and 14 Franchise Flips, respectively.

Additionally, during the six months ended June 29, 2025, the Company completed the sale of two Company-operated restaurants to franchisees.

No Company-operated restaurants were sold to franchisees during the six months ended June 30, 2024.

Gains and losses recognized on dispositions are recorded to “System optimization gains, net” in our condensed consolidated statements of operations.

Costs related to acquisitions and dispositions under our system optimization initiative are recorded to “Reorganization and realignment costs.” All other costs incurred related to facilitating Franchise Flips are recorded to “Franchise support and other costs.”

The following is a summary of the disposition activity recorded as a result of our system optimization initiative:

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Number of restaurants sold to franchisees — — 2 —

3 unchanged sentences

Loss on sales of restaurants, net — — ( 139 ) —

Gain (loss) on sales of other assets, net (b) 49 ( 127 )

System optimization losses, net $ ( 90 ) $ ( 127 )

Post-closing adjustments on sales of restaurants (b) ( 10 ) 254 ( 10 ) 254

(Loss) gain on sales of restaurants, net ( 10 ) 254 ( 149 ) 254

Gain (loss) on sales of other assets, net (c) 397 26 446 ( 101 )

System optimization gains, net $ 387 $ 280 $ 297 $ 153

_______________

(a) Net assets sold consisted primarily of equipment.

(b) During the three months ended March 31, 2024, the Company received net cash proceeds of $ 26 , primarily from the sale of surplus and other properties.

(b) The three and six months ended June 30, 2024 represent the recognition of deferred gains as a result of the resolution of certain contingencies related to the extension of lease terms for restaurants previously sold to franchisees.

THE WENDY’S COMPANY AND SUBSIDIARIES

1 unchanged sentence

(In Thousands Except Per Share Amounts)

(c) During the three and six months ended June 29, 2025, the Company received net cash proceeds of $ 1,300 , primarily from the sale of surplus and other properties.

During the three and six months ended June 30, 2024, the Company received net cash proceeds of $ 575 and $ 601 , respectively, primarily from the sale of surplus and other properties.

Assets Held for Sale

As of March 30, 2025 and December 29, 2024, the Company had assets held for sale of $ 3,727 and $ 2,833 , respectively, primarily consisting of surplus properties.

As of June 29, 2025 and December 29, 2024, the Company had assets held for sale of $ 5,144 and $ 2,833 , respectively, primarily consisting of surplus properties.

Assets held for sale are included in “Prepaid expenses and other current assets.”

1 unchanged sentence

The following is a summary of the initiatives included in “Reorganization and realignment costs:”

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Organizational Redesign Plan $ 106 $ 2,409 $ ( 844 ) $ 8,031

3 unchanged sentences

In February 2023, the Board of Directors approved a plan to redesign the Company’s organizational structure to better support the execution of the Company’s long-term growth strategy by maximizing organizational efficiency and streamlining decision making (the “Organizational Redesign Plan”).

Additionally, in January 2024, the Board of Directors announced the appointment of Kirk Tanner as the Company’s new President and Chief Executive Officer, effective February 5, 2024.

Tanner succeeded Todd A.

Penegor, the Company’s previous President and Chief Executive Officer, who departed from the Company in February 2024.

Additionally, in January 2024, the Board of Directors announced the appointment of a new President and Chief Executive Officer and the departure of the Company’s previous President and Chief Executive Officer.

The Company expects to incur total costs of approximately $ 17,000 related to the Organizational Redesign Plan, including costs related to the 2024 succession of the President and Chief Executive Officer role.

During the three months ended March 30, 2025, the Company recognized costs totaling $( 950 ), which primarily included a reversal of a severance accrual.

During the three months ended March 31, 2024, the Company recognized costs totaling $ 5,622 , which primarily included severance and related employee costs.

During the six months ended June 29, 2025, the Company recognized costs totaling $( 844 ), which primarily included a reversal of a severance accrual.

During the six months ended June 30, 2024, the Company recognized costs totaling $ 8,031 , which primarily included severance and related employee costs.

The Company expects to incur additional costs aggregating approximately $ 400 , comprised primarily of share-based compensation.

1 unchanged sentence

The following is a summary of the costs recorded as a result of the Organizational Redesign Plan:

Three Months Ended Total Incurred Since Inception

2025 March 31,

Three Months Ended Six Months Ended Total Incurred Since Inception

2025 June 30,

2024 June 29,

2025 June 30,

Severance and related employee costs (a) $ ( 6 ) $ 1,948 $ ( 1,094 ) $ 7,310 $ 12,402

5 unchanged sentences

_______________

(a) The three months ended March 30, 2025 includes a reversal of an accrual as a result of a change in estimate.

(a) The six months ended June 29, 2025 includes a reversal of an accrual as a result of a change in estimate.

(b) Total incurred since inception primarily represents the accelerated recognition of share-based compensation resulting from the termination of employees under the Organizational Redesign Plan.

2 unchanged sentences

(In Thousands Except Per Share Amounts)

As of March 30, 2025, the accruals for the Organizational Redesign Plan are included in “Accrued expenses and other current liabilities.” The tables below present a rollforward of our accruals for the Organizational Redesign Plan.

As of June 29, 2025, the accruals for the Organizational Redesign Plan are included in “Accrued expenses and other current liabilities.” The tables below present a rollforward of our accruals for the Organizational Redesign Plan.

Charges Payments Balance

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Other Reorganization and Realignment Plans

Costs incurred under the Company’s other reorganization and realignment plans were not material during the three months ended March 30, 2025 and March 31, 2024.

Costs incurred under the Company’s other reorganization and realignment plans were not material during the six months ended June 29, 2025 and June 30, 2024.

The Company does not expect to incur any material additional costs under these plans.

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The following is a summary of impairment losses recorded, which represent the excess of the carrying amount over the fair value of the affected assets and are included in “Impairment of long-lived assets:”

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Company-operated restaurants $ 1,686 $ 644 $ 2,873 $ 2,418

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The following table includes supplemental non-cash investing and financing activities:

Three Months Ended

2025 March 31,

Six Months Ended

2025 June 30,

Supplemental non-cash investing and financing activities:

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Lease Guarantees

Wendy’s has guaranteed the performance of certain leases and other obligations, primarily from former Company-operated restaurant locations now operated by franchisees, amounting to $ 100,858 as of March 30, 2025.

These leases extend through 2045.

We have had no judgments against us as guarantor of these leases as of March 30, 2025.

We have had no judgments against us as guarantor of these leases as of June 29, 2025.

In the event of default by a franchise owner where Wendy’s is called upon to perform under its guarantee, Wendy’s has the ability to pursue repayment from the franchise owner.

The liability recorded for our probable exposure associated with these lease guarantees was not material as of March 30, 2025.

The liability recorded for our probable exposure associated with these lease guarantees was not material as of June 29, 2025.

Letters of Credit

As of March 30, 2025, the Company had outstanding letters of credit with various parties totaling $ 28,985 .

As of June 29, 2025, the Company had outstanding letters of credit with various parties totaling $ 28,995 .

Substantially all of the outstanding letters of credit include amounts outstanding against the 2021-1 Variable Funding Senior Secured Notes, Class A-1.

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A wholly-owned subsidiary of Wendy’s leases restaurant facilities from TimWen, which are then subleased to franchisees for the operation of Wendy’s/Tim Hortons combo units in Canada.

Wendy’s paid TimWen $ 4,798 and $ 5,030 under these lease agreements during the three months ended March 30, 2025 and March 31, 2024, respectively, which has been recorded to “Franchise rental expense.” In addition, TimWen paid Wendy’s a management fee under the TimWen joint venture agreement of $ 56 and $ 60 during the three months ended March 30, 2025 and March 31, 2024, respectively, which is included as a reduction to “General and administrative.”

Wendy’s paid TimWen $ 10,344 and $ 10,522 under these lease agreements during the six months ended June 29, 2025 and June 30, 2024, respectively, which has been recorded to “Franchise rental expense.” In addition, TimWen paid Wendy’s a management fee under the TimWen joint venture agreement of $ 115 and $ 120 during the six months ended June 29, 2025 and June 30, 2024, respectively, which is included as a reduction to “General and administrative.”

Transactions with QSCC

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Should QSCC’s sourcing fees exceed its expected needs, QSCC’s board of directors may return some or all of the excess to its members in the form of a patronage dividend.

Wendy’s recorded its share of patronage dividends of $ 3,096 during the three months ended March 31, 2024, of which $ 2,909 is included in “Other operating income, net” and $ 187 is included as a reduction of “Cost of sales.” There were no patronage dividends recorded during the three months ended March 30, 2025.

Wendy’s recorded its share of patronage dividends of $ 3,379 during the six months ended June 30, 2024, of which $ 2,909 is included in “Other operating income, net” and $ 470 is included as a reduction of “Cost of sales.” There were no patronage dividends recorded during the six months ended June 29, 2025.

Transactions with Yellow Cab

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Peter May, our Senior Vice Chairman, and Mr.

Matthew Peltz, our Vice Chairman, hold minority ownership interests in Yellow Cab Holdings, LLC (“Yellow Cab”), a Wendy’s franchisee that, as of March 30, 2025 owned and operated 89 Wendy’s restaurants, and/or certain of the operating companies managed by Yellow Cab.

During the three months ended March 30, 2025 and March 31, 2024, the Company recognized $ 3,664 and $ 3,612 , respectively, in royalty, advertising fund, lease and other income from Yellow Cab and related entities.

Matthew Peltz, our former Vice Chairman, hold minority ownership interests in Yellow Cab Holdings, LLC (“Yellow Cab”), a Wendy’s franchisee that, as of June 29, 2025 owned and operated 89 Wendy’s restaurants, and/or certain of the operating companies managed by Yellow Cab.

In addition, Mr.

Bradley Peltz, a director of the Company, is a Managing Director of, and holds a minority ownership interest in, Yellow Cab.

During the six months ended June 29, 2025 and June 30, 2024, the Company recognized $ 7,588 and $ 7,543 , respectively, in royalty, advertising fund, lease and other income from Yellow Cab and related entities.

In all transactions involving Yellow Cab, the Company’s standard franchisee recruiting and approval processes were followed, no modifications were made to the Company’s standard franchise agreements or related documents, and all deal terms and transaction documents were negotiated and executed on an arm’s-length basis, consistent with the Company’s comparable franchise transactions and relationships.

As of March 30, 2025 and December 29, 2024, $ 1,156 and $ 1,132 , respectively, was due from Yellow Cab for such income, which is included in “Accounts and notes receivable, net” and “Advertising funds restricted assets.”

As of June 29, 2025 and December 29, 2024, $ 1,153 and $ 1,132 , respectively, was due from Yellow Cab for such income, which is included in “Accounts and notes receivable, net” and “Advertising funds restricted assets.”

Transactions with AMC

In February 2023, Ms.

Kristin Dolan, a director of the Company, was appointed as the Chief Executive Officer of AMC Networks Inc.

During the three months ended March 30, 2025 and March 31, 2024, the Company purchased approximately $ 300 and $ 500 , respectively, of advertising time from a subsidiary of AMC.

Kristin Dolan, a director of the Company, serves as the Chief Executive Officer of AMC Networks Inc.

During the six months ended June 29, 2025 and June 30, 2024, the Company purchased approximately $ 600 and $ 1,100 , respectively, of advertising time from a subsidiary of AMC.

The Company’s advertising spend with AMC was made in the ordinary course of business and approved on an arm’s-length basis, consistent with the Company’s comparable advertising decisions.

As of March 30, 2025 and December 29, 2024, approximately $ 26 and $ 17 , respectively, was due to AMC for such advertising time, which is included in “Advertising funds restricted liabilities.”

As of June 29, 2025 and December 29, 2024, approximately $ 27 and $ 17 , respectively, was due to AMC for such advertising time, which is included in “Advertising funds restricted liabilities.”

(16) Legal and Environmental Matters

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revenue, significant segment expenses and segment adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) are as follows:

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

revenue $ 461,142 $ 472,591 $ 890,756 $ 915,438

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_______________

(a) Includes advertising fund expense of $ 2,325 for the three months ended March 31, 2024 related to the Company’s funding of incremental advertising.

There was no funding of incremental advertising during the three months ended March 30, 2025.

(b) Other segment items for the three months ended March 30, 2025 primarily include lease buyout activity and professional fees.

Other segment items for the three months ended March 31, 2024 primarily include professional fees.

(a) Includes advertising fund expense of $ 5,084 and $ 7,409 for the three and six months ended June 30, 2024, respectively, related to the Company’s funding of incremental advertising.

There was no funding of incremental advertising during the three and six months ended June 29, 2025.

(b) Other segment items for the three and six months ended June 29, 2025 and June 30, 2024 primarily include professional fees.

Wendy’s International revenue, significant segment expenses and segment adjusted EBITDA are as follows:

Three Months Ended

March 30, 2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Wendy’s International revenue $ 38,850 $ 36,361 $ 73,571 $ 69,176

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_______________

(a) Includes advertising fund expense of $ 159 and $ 162 for the three months ended March 30, 2025 and March 31, 2024, respectively, related to the Company’s funding of incremental advertising.

In addition, includes other international-related advertising deficit of $ 1,153 and $ 150 for the three months ended March 30, 2025 and March 31, 2024, respectively.

(b) Other segment items for the three months ended March 30, 2025 and March 31, 2024 primarily include franchise support and other costs.

(a) Includes advertising fund expense of $ 183 and $ 342 for the three and six months ended June 29, 2025, respectively, and $ 603 and $ 765 for the three and six months ended June 30, 2024, respectively, related to the Company’s funding of incremental advertising.

In addition, includes other international-related advertising surplus (deficit) of $ 34 and $( 1,119 ) for the three and six months ended June 29, 2025, respectively, and $( 320 ) and $( 470 ) for the three and six months ended June 30, 2024, respectively.

(b) Other segment items for the three and six months ended June 29, 2025 and June 30, 2024 primarily include franchise support and other costs.

THE WENDY’S COMPANY AND SUBSIDIARIES

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Global Real Estate & Development revenue, significant segment expenses and segment adjusted EBITDA are as follows:

Three Months Ended

March 30, 2025 March 31, 2024

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

Global Real Estate & Development revenue $ 60,937 $ 61,775 $ 120,074 $ 120,866

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_______________

(a) Other segment items primarily include equity in earnings from our TimWen joint venture, franchise support and other costs and gains on sales-type leases.

Equity in earnings from our TimWen joint venture was $ 2,252 and $ 2,522 for the three months ended March 30, 2025 and March 31, 2024, respectively.

(a) Other segment items primarily include equity in earnings from our TimWen joint venture and franchise support and other costs.

Equity in earnings from our TimWen joint venture was $ 3,060 and $ 5,312 for the three and six months ended June 29, 2025, respectively, and $ 3,027 and $ 5,549 for the three and six months ended June 30, 2024, respectively.

The following table reconciles profit by segment to the Company’s consolidated income before income taxes:

Three Months Ended

2025 March 31,

Three Months Ended Six Months Ended

2025 June 30,

2024 June 29,

2025 June 30,

$ 137,159 $ 136,709 $ 258,136 $ 262,533

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Amortization of cloud computing arrangements ( 4,056 ) ( 3,519 ) ( 8,223 ) ( 7,061 )

System optimization losses, net ( 90 ) ( 127 )

System optimization gains, net 387 280 297 153

Reorganization and realignment costs ( 174 ) ( 2,452 ) 518 ( 8,125 )

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Interest expense, net ( 30,945 ) ( 30,995 ) ( 62,422 ) ( 61,530 )

Investment loss, net ( 1,718 ) —

Investment income (loss), net — 11 ( 1,718 ) 11

Other income, net 2,585 6,300 7,571 13,136

11 unchanged sentences

In January 2025, the FASB issued an update that clarified that the amendment is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted.

Measurement of Credit Losses for Accounts Receivable and Contract Assets

In July 2025, the FASB issued an amendment to provide a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets for revenue arising from contracts with customers.

The amendment is effective commencing with our 2026 fiscal year.

We are currently evaluating the impact of the adoption of this guidance on our condensed consolidated financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements