Item 1. Financial Statements
Item 1. Financial Statements.
THE WENDY’S COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Par Value)
June 28,
2026 December 28,
2025
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $ 341,211 $ 300,833
Restricted cash 38,786 39,207
Accounts and notes receivable, net 109,247 117,333
Inventories 7,036 7,387
Prepaid expenses and other current assets 78,922 55,412
Advertising funds restricted assets 102,897 97,867
Total current assets 678,099 618,039
Properties 895,598 937,795
Finance lease assets 319,808 312,844
Operating lease assets 582,630 642,589
Goodwill 773,119 774,088
Other intangible assets 1,147,228 1,170,671
Investments 22,988 25,227
Net investment in sales-type and direct financing leases 276,853 284,891
Other assets 187,893 190,417
Total assets $ 4,884,216 $ 4,956,561
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt $ 29,750 $ 29,750
Current portion of finance lease liabilities 27,538 26,673
Current portion of operating lease liabilities 51,953 51,119
Accounts payable 21,440 30,450
Accrued expenses and other current liabilities 124,713 116,655
Advertising funds restricted liabilities 102,078 96,454
Total current liabilities 357,472 351,101
Long-term debt 2,719,239 2,730,502
Long-term finance lease liabilities 647,637 646,715
Long-term operating lease liabilities 596,408 660,257
Deferred income taxes 289,268 287,753
Deferred franchise fees 81,671 87,956
Other liabilities 72,054 74,894
Total liabilities 4,763,749 4,839,178
Commitments and contingencies
Stockholders’ equity:
Common stock, $ 0.10 par value; 1,500,000 shares authorized;
470,424 shares issued; 190,639 and 190,324 shares outstanding, respectively
47,042 47,042
Additional paid-in capital 2,990,095 2,986,150
Retained earnings 437,099 435,124
Common stock held in treasury, at cost; 279,785 and 280,100 shares, respectively
( 3,283,017 ) ( 3,286,965 )
Accumulated other comprehensive loss ( 70,752 ) ( 63,968 )
Total stockholders’ equity 120,467 117,383
Total liabilities and stockholders’ equity $ 4,884,216 $ 4,956,561
See accompanying notes to condensed consolidated financial statements.
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THE WENDY’S COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Per Share Amounts)
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
(Unaudited)
Revenues:
Sales $ 240,016 $ 232,853 $ 465,513 $ 452,363
Franchise royalty revenue and fees 149,771 156,300 297,666 301,448
Franchise rental income 53,363 60,411 112,267 118,865
Advertising funds revenue 127,421 111,365 235,762 211,725
570,571 560,929 1,111,208 1,084,401
Costs and expenses:
Cost of sales 207,275 196,521 408,324 384,690
Franchise support and other costs 22,566 17,069 44,557 33,665
Franchise rental expense 28,039 32,630 58,215 63,331
Advertising funds expense 127,879 111,374 236,494 212,902
General and administrative 66,161 59,485 139,004 127,689
Depreciation and amortization (exclusive of amortization of cloud computing arrangements shown separately below) 38,061 36,990 78,636 73,539
Amortization of cloud computing arrangements 4,577 4,056 9,339 8,223
System optimization gains, net ( 667 ) ( 387 ) ( 2,292 ) ( 297 )
Reorganization and realignment costs 10 174 ( 152 ) ( 518 )
Impairment of long-lived assets 3,120 1,686 5,692 3,107
Other operating income, net ( 5,734 ) ( 2,929 ) ( 10,814 ) ( 9,316 )
491,287 456,669 967,003 897,015
Operating profit 79,284 104,260 144,205 187,386
Interest expense, net ( 33,850 ) ( 30,945 ) ( 67,956 ) ( 62,422 )
Investment loss, net — — — ( 1,718 )
Other income, net 3,133 2,585 6,483 7,571
Income before income taxes 48,567 75,900 82,732 130,817
Provision for income taxes ( 15,951 ) ( 20,790 ) ( 27,404 ) ( 36,475 )
Net income $ 32,616 $ 55,110 $ 55,328 $ 94,342
Basic and diluted net income per share $ .17 $ .29 $ .29 $ .48
See accompanying notes to condensed consolidated financial statements.
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THE WENDY’S COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands)
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
(Unaudited)
Net income $ 32,616 $ 55,110 $ 55,328 $ 94,342
Other comprehensive (loss) income:
Foreign currency translation adjustment ( 3,988 ) 10,305 ( 6,784 ) 12,217
Other comprehensive (loss) income ( 3,988 ) 10,305 ( 6,784 ) 12,217
Comprehensive income $ 28,628 $ 65,415 $ 48,544 $ 106,559
See accompanying notes to condensed consolidated financial statements.
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THE WENDY’S COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In Thousands)
Common
Stock Additional
Paid-In
Capital Retained Earnings Common Stock Held in Treasury Accumulated Other Comprehensive Loss Total
(Unaudited)
Balance at December 28, 2025 $ 47,042 $ 2,986,150 $ 435,124 $ ( 3,286,965 ) $ ( 63,968 ) $ 117,383
Net income — — 22,712 — — 22,712
Other comprehensive loss — — — — ( 2,796 ) ( 2,796 )
Cash dividends — — ( 26,648 ) — — ( 26,648 )
Share-based compensation — 5,246 — — — 5,246
Common stock issued upon vesting of restricted shares — ( 2,006 ) — 1,583 — ( 423 )
Other — ( 35 ) ( 15 ) 127 — 77
Balance at March 29, 2026 $ 47,042 $ 2,989,355 $ 431,173 $ ( 3,285,255 ) $ ( 66,764 ) $ 115,551
Net income — — 32,616 — — 32,616
Other comprehensive loss — — — — ( 3,988 ) ( 3,988 )
Cash dividends — — ( 26,668 ) — — ( 26,668 )
Share-based compensation — 2,941 — — — 2,941
Common stock issued upon vesting of restricted shares — ( 2,162 ) — 2,136 — ( 26 )
Other — ( 39 ) ( 22 ) 102 — 41
Balance at June 28, 2026 $ 47,042 $ 2,990,095 $ 437,099 $ ( 3,283,017 ) $ ( 70,752 ) $ 120,467
See accompanying notes to condensed consolidated financial statements.
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THE WENDY’S COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY—CONTINUED
(In Thousands)
Common
Stock Additional
Paid-In
Capital Retained Earnings Common Stock Held in Treasury Accumulated Other Comprehensive Loss Total
(Unaudited)
Balance at December 29, 2024 $ 47,042 $ 2,982,102 $ 399,700 $ ( 3,094,739 ) $ ( 74,753 ) $ 259,352
Net income — — 39,232 — — 39,232
Other comprehensive income — — — — 1,912 1,912
Cash dividends — — ( 49,432 ) — — ( 49,432 )
Repurchases of common stock — — — ( 125,399 ) — ( 125,399 )
Share-based compensation — 5,572 — — — 5,572
Common stock issued upon exercises of stock options
— ( 130 ) — 326 — 196
Common stock issued upon vesting of restricted shares
— ( 2,702 ) — 1,453 — ( 1,249 )
Other — 23 ( 19 ) 51 — 55
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.
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THE WENDY’S COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
Six Months Ended
June 28,
2026 June 29,
2025
(Unaudited)
Cash flows from operating activities:
Net income $ 55,328 $ 94,342
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (exclusive of amortization of
cloud computing arrangements shown separately below)
78,636 73,539
Amortization of cloud computing arrangements 9,339 8,223
Share-based compensation 8,187 10,704
Impairment of long-lived assets 5,692 3,107
Deferred income tax 1,375 822
Non-cash rental expense, net 25,938 21,406
Change in operating lease liabilities ( 25,247 ) ( 24,482 )
Net receipt of deferred vendor incentives 9,781 8,421
System optimization gains, net ( 2,292 ) ( 297 )
Distributions received from joint ventures, net of equity in earnings 1,221 1,679
Long-term debt-related activities, net 3,612 3,744
Cloud computing arrangements expenditures ( 10,241 ) ( 9,335 )
Changes in operating assets and liabilities and other, net ( 1,372 ) ( 45,865 )
Net cash provided by operating activities 159,957 146,008
Cash flows from investing activities:
Capital expenditures ( 31,439 ) ( 39,050 )
Franchise development fund ( 10,998 ) ( 16,518 )
Dispositions 4,664 1,355
Notes receivable, net — 1,949
Net cash used in investing activities ( 37,773 ) ( 52,264 )
Cash flows from financing activities:
Proceeds from long-term debt 17,800 23,500
Repayments of long-term debt ( 32,675 ) ( 23,125 )
Repayments of finance lease liabilities ( 12,106 ) ( 10,666 )
Repurchases of common stock ( 1,922 ) ( 186,516 )
Dividends ( 53,316 ) ( 76,243 )
Proceeds from stock option exercises — 1,717
Payments related to tax withholding for share-based compensation ( 449 ) ( 1,354 )
Net cash used in financing activities ( 82,668 ) ( 272,687 )
Net cash provided by (used in) operations before effect of exchange rate changes on cash 39,516 ( 178,943 )
Effect of exchange rate changes on cash ( 2,408 ) 5,437
Net increase (decrease) in cash, cash equivalents and restricted cash 37,108 ( 173,506 )
Cash, cash equivalents and restricted cash at beginning of period 357,672 503,608
Cash, cash equivalents and restricted cash at end of period $ 394,780 $ 330,102
See accompanying notes to condensed consolidated financial statements.
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
(1) Basis of Presentation
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 June 28, 2026, the results of our operations for the three and six months ended June 28, 2026 and June 29, 2025 and cash flows for the six months ended June 28, 2026 and June 29, 2025. The results of operations for the six months ended June 28, 2026 are not necessarily indicative of the results to be expected for the full 2026 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 28, 2025 (the “Form 10-K”).
The principal 100% owned subsidiary of the Company is Wendy’s International, LLC and its subsidiaries (“Wendy’s”). The Company manages and internally reports its business in the following segments: (1) Wendy’s U.S., (2) Wendy’s International and (3) Global Real Estate & Development. See Note 17 for further information.
We report on a fiscal year consisting of 52 or 53 weeks ending on the Sunday closest to or on December 31. 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.
Our significant interim accounting policies include the recognition of advertising funds expense in proportion to advertising funds revenue.
(2) Revenue
Disaggregation of Revenue
The following tables disaggregate revenue by segment and source:
Wendy’s U.S. Wendy’s International Global Real Estate & Development Total
Three Months Ended June 28, 2026
Sales at Company-operated restaurants $ 234,007 $ 6,009 $ — $ 240,016
Franchise royalty revenue 103,749 19,825 — 123,574
Franchise fees 22,126 3,726 345 26,197
Franchise rental income — — 53,363 53,363
Advertising funds revenue 117,715 9,706 — 127,421
Total revenues $ 477,597 $ 39,266 $ 53,708 $ 570,571
Three Months Ended June 29, 2025
Sales at Company-operated restaurants $ 225,973 $ 6,880 $ — $ 232,853
Franchise royalty revenue 112,842 19,391 — 132,233
Franchise fees 20,972 2,569 526 24,067
Franchise rental income — — 60,411 60,411
Advertising funds revenue 101,355 10,010 — 111,365
Total revenues $ 461,142 $ 38,850 $ 60,937 $ 560,929
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
Wendy’s U.S. Wendy’s International Global Real Estate & Development Total
Six Months Ended June 28, 2026
Sales at Company-operated restaurants $ 453,302 $ 12,211 $ — $ 465,513
Franchise royalty revenue 201,057 38,707 — 239,764
Franchise fees 50,409 6,501 992 57,902
Franchise rental income — — 112,267 112,267
Advertising funds revenue 216,988 18,774 — 235,762
Total revenues $ 921,756 $ 76,193 $ 113,259 $ 1,111,208
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
Contract Balances
The following table provides information about receivables and contract liabilities (deferred franchise fees) from contracts with customers:
June 28,
2026 (a) December 28, 2025 (a)
Receivables, which are included in “Accounts and notes receivable, net” (b)
$ 68,178 $ 59,060
Receivables, which are included in “Advertising funds restricted assets”
83,169 75,083
Deferred franchise fees (c) 90,724 98,496
_______________
(a) Excludes funds collected from the sale of gift cards, which are primarily reimbursed to franchisees upon redemption at franchised restaurants and do not ultimately result in the recognition of revenue in the Company’s condensed consolidated statements of operations.
(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 $ 9,053 and $ 81,671 , respectively, as of June 28, 2026, and $ 10,540 and $ 87,956 , respectively, as of December 28, 2025.
Significant changes in deferred franchise fees are as follows:
Six Months Ended
June 28,
2026 June 29,
2025
Deferred franchise fees at beginning of period $ 98,496 $ 99,411
Revenue recognized during the period
( 8,598 ) ( 4,438 )
New deferrals due to cash received and other 826 4,424
Deferred franchise fees at end of period $ 90,724 $ 99,397
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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
The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period:
Estimate for fiscal year:
2026 (a) $ 9,052
2027 6,561
2028 6,395
2029 6,291
2030 6,187
Thereafter 56,238
$ 90,724
_______________
(a) Represents franchise fees expected to be recognized for the remainder of 2026, which includes development-related franchise fees expected to be recognized over a duration of one year or less.
(3) Leases
Nature of Leases
The Company operates restaurants that are located on sites owned by us and sites leased by us from third parties. In addition, the Company owns sites and leases sites from third parties, which it leases and/or subleases to franchisees. The Company also leases restaurant, office and transportation equipment. As of June 28, 2026, the nature of restaurants operated by the Company and its franchisees was as follows:
June 28,
2026
Company-operated restaurants:
Owned land and building 154
Owned building and held long-term land leases 141
Leased land and building 135
Total Company-operated restaurants 430
Franchisee-operated restaurants:
Company-owned properties leased to franchisees 443
Company-leased properties subleased to franchisees 1,088
Other franchisee-operated restaurants 5,219
Total franchisee-operated restaurants 6,750
Total Company-operated and franchisee-operated restaurants 7,180
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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 Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Finance lease cost:
Amortization of finance lease assets $ 5,358 $ 4,885 $ 11,126 $ 10,030
Interest on finance lease liabilities 11,615 10,865 23,257 21,742
16,973 15,750 34,383 31,772
Operating lease cost 17,381 21,322 37,391 41,839
Variable lease cost (a) 16,570 17,269 32,479 33,482
Short-term lease cost 1,390 1,304 2,766 2,570
Total operating lease cost (b) 35,341 39,895 72,636 77,891
Total lease cost $ 52,314 $ 55,645 $ 107,019 $ 109,663
_______________
(a) Includes expenses for executory costs of $ 10,297 and $ 10,578 for the three months ended June 28, 2026 and June 29, 2025, respectively, and $ 20,836 and $ 20,972 for the six months ended June 28, 2026 and June 29, 2025, respectively, for which the Company is reimbursed by sublessees.
(b) Includes $ 27,953 and $ 32,569 for the three months ended June 28, 2026 and June 29, 2025, respectively, and $ 57,993 and $ 63,221 for the six months ended June 28, 2026 and June 29, 2025, respectively, recorded to “Franchise rental expense” for leased properties that are subsequently leased to franchisees. Also includes $ 6,917 and $ 6,946 for the three months ended June 28, 2026 and June 29, 2025, respectively, and $ 13,804 and $ 13,887 for the six months ended June 28, 2026 and June 29, 2025, 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 Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Sales-type and direct-financing leases:
Selling profit $ 276 $ 34 $ 2,129 $ 23
Interest income (a) 6,563 6,943 13,263 13,858
Operating lease income 36,038 42,467 78,689 84,888
Variable lease income 17,325 17,944 33,578 33,977
Franchise rental income (b) $ 53,363 $ 60,411 $ 112,267 $ 118,865
_______________
(a) Included in “Interest expense, net.”
(b) Includes sublease income of $ 37,941 and $ 44,667 recognized during the three months ended June 28, 2026 and June 29, 2025, respectively, and $ 80,141 and $ 87,451 for the six months ended June 28, 2026 and June 29, 2025, respectively. Sublease income includes lessees’ variable payments to the Company for executory costs of $ 10,356 and $ 10,512 for the three months ended June 28, 2026 and June 29, 2025, respectively, and $ 20,767 and $ 20,709 for the six months ended June 28, 2026 and June 29, 2025, respectively.
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
(4) Investments
Equity Method Investment
Wendy’s has a 50 % share in a partnership in a Canadian restaurant real estate joint venture (“TimWen”) with a subsidiary of Restaurant Brands International Inc., a quick-service restaurant company that owns the Tim Hortons ® brand (Tim Hortons is a registered trademark of Tim Hortons USA Inc.). The Company has significant influence over this investee. 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.”
Presented below is activity related to our investment in TimWen included in our condensed consolidated financial statements:
Six Months Ended
June 28,
2026 June 29,
2025
Balance at beginning of period $ 25,227 $ 27,288
Equity in earnings for the period 6,476 6,514
Amortization of purchase price adjustments (a) ( 940 ) ( 1,202 )
5,536 5,312
Distributions received ( 6,757 ) ( 6,991 )
Foreign currency translation adjustment included in “Other comprehensive (loss) income”
( 1,018 ) 1,483
Balance at end of period $ 22,988 $ 27,092
_______________
(a) Purchase price adjustments that impacted the carrying value of the Company’s investment in TimWen are being amortized over the average original aggregate life of 21 years.
Other Investments in Equity Securities
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.
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
(5) Long-Term Debt
Long-term debt consisted of the following:
June 28,
2026 December 28,
2025
Class A-2 Notes:
5.422 % Series 2025-1 Class A-2-I Notes, anticipated repayment date 2032
$ 447,750 $ 450,000
4.236 % Series 2022-1 Class A-2-I Notes, anticipated repayment date 2029
96,000 96,500
4.535 % Series 2022-1 Class A-2-II Notes, anticipated repayment date 2032
380,134 382,134
2.370 % Series 2021-1 Class A-2-I Notes, anticipated repayment date 2029
412,019 414,269
2.775 % Series 2021-1 Class A-2-II Notes, anticipated repayment date 2031
617,280 620,530
4.080 % Series 2019-1 Class A-2-II Notes, anticipated repayment date 2029
391,873 394,123
3.884 % Series 2018-1 Class A-2-II Notes, anticipated repayment date 2028
429,224 431,599
Unamortized debt issuance costs ( 25,291 ) ( 28,903 )
2,748,989 2,760,252
Less amounts payable within one year ( 29,750 ) ( 29,750 )
Total long-term debt $ 2,719,239 $ 2,730,502
Other Long-Term Debt
Wendy’s U.S. advertising fund has a revolving line of credit of $ 15,000 , which was established to support the Company’s advertising fund operations and bears interest at the Secured Overnight Financing Rate (“SOFR”) plus 2.25 %. Borrowings under the line of credit are guaranteed by Wendy’s. During the three months ended March 29, 2026, the Company borrowed and repaid $ 11,500 under the revolving line of credit, then subsequently borrowed and repaid $ 3,600 under the revolving line of credit. During the three months ended June 28, 2026, the Company borrowed and repaid $ 2,700 under the revolving line of credit. As a result, as of June 28, 2026, the Company had no outstanding borrowings under the revolving line of credit. Subsequent to June 28, 2026, the Company increased the Wendy’s U.S. advertising fund revolving line of credit to $ 25,000 .
(6) Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques under the accounting guidance related to fair value measurements are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. These inputs are classified into the following hierarchy:
• Level 1 Inputs - Quoted prices for identical assets or liabilities in active markets.
• Level 2 Inputs - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.
• Level 3 Inputs - Pricing inputs are unobservable for the assets or liabilities and include situations where there is little, if any, market activity for the assets or liabilities. The inputs into the determination of fair value require significant management judgment or estimation.
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
Financial Instruments
The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments:
June 28,
2026 December 28,
2025
Carrying
Amount Fair
Value Carrying
Amount Fair
Value Fair Value
Measurements
Financial assets
Cash equivalents $ 220,093 $ 220,093 $ 210,607 $ 210,607 Level 1
Financial liabilities (a)
Series 2025-1 Class A-2-I Notes 447,750 441,034 450,000 447,075 Level 2
Series 2022-1 Class A-2-I Notes 96,000 93,221 96,500 95,284 Level 2
Series 2022-1 Class A-2-II Notes 380,134 360,671 382,134 371,625 Level 2
Series 2021-1 Class A-2-I Notes 412,019 379,894 414,269 385,726 Level 2
Series 2021-1 Class A-2-II Notes 617,280 542,509 620,530 553,699 Level 2
Series 2019-1 Class A-2-II Notes 391,873 375,884 394,123 383,403 Level 2
Series 2018-1 Class A-2-II Notes 429,224 419,301 431,599 421,630 Level 2
_______________
(a) The fair values were based on quoted market prices in markets that are not considered active markets.
The carrying amounts of cash, accounts payable and accrued expenses approximate fair value due to the short-term nature of those items. The carrying amounts of accounts and notes receivable, net (both current and non-current) approximate fair value due to the effect of the related allowance for doubtful accounts. Our cash equivalents are the only financial assets measured and recorded at fair value on a recurring basis.
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
Non-Recurring Fair Value Measurements
Assets and liabilities remeasured to fair value on a non-recurring basis resulted in impairment that we have recorded to “Impairment of long-lived assets” in our condensed consolidated statements of operations.
Total impairment losses may reflect the impact of remeasuring long-lived assets held and used (including land, buildings, leasehold improvements, favorable lease assets and right-of-use assets) to fair value as a result of (1) the deterioration in operating performance of certain Company-operated restaurants and (2) the Company’s decision to lease and/or sublease the land and/or buildings to franchisees in connection with the sale or anticipated sale of restaurants, including any subsequent lease modifications. The fair values of long-lived assets held and used presented in the tables below represent the remaining carrying value and were estimated based on either discounted cash flows of future anticipated lease and sublease income or discounted cash flows of future anticipated Company-operated restaurant performance. Total impairment losses may also include the impact of remeasuring long-lived assets held for sale. The fair values of long-lived assets held for sale presented in the tables below represent the remaining carrying value and were estimated based on current market values. See Note 12 for further information on impairment of our long-lived assets.
Fair Value Measurements
June 28,
2026 Level 1 Level 2 Level 3
Held and used $ 2,229 $ — $ — $ 2,229
Held for sale 3,476 — — 3,476
Total $ 5,705 $ — $ — $ 5,705
Fair Value Measurements
December 28,
2025 Level 1 Level 2 Level 3
Held and used $ 1,367 $ — $ — $ 1,367
Held for sale 2,457 — — 2,457
Total $ 3,824 $ — $ — $ 3,824
(7) Income Taxes
The Company’s effective tax rate for the three months ended June 28, 2026 and June 29, 2025 was 32.8 % and 27.4 %, respectively. The Company’s effective tax rate varied from the U.S. federal statutory rate of 21 % for the three months ended June 28, 2026 primarily due to the tax effects of our foreign operations and state income taxes.
The Company’s effective tax rate for the six months ended June 28, 2026 and June 29, 2025 was 33.1 % and 27.9 %, respectively. The Company’s effective tax rate varied from the U.S. federal statutory rate of 21 % for the six months ended June 28, 2026 primarily due to the tax effects of our foreign operations, state income taxes and share-based compensation.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
(8) Net Income Per Share
The calculation of basic and diluted net income per share was as follows:
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Net income $ 32,616 $ 55,110 $ 55,328 $ 94,342
Common stock:
Weighted average basic shares outstanding 190,426 191,949 190,359 196,296
Dilutive effect of stock options and restricted shares
786 765 696 870
Weighted average diluted shares outstanding 191,212 192,714 191,055 197,166
Basic and diluted net income per share $ .17 $ .29 $ .29 $ .48
Basic net income per share for the three and six months ended June 28, 2026 and June 29, 2025 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 12,516 and 12,221 for the three and six months ended June 28, 2026, respectively, and 7,990 and 8,139 for the three and six months ended June 29, 2025, respectively, from our diluted net income per share calculation as they would have had anti-dilutive effects.
(9) Stockholders’ Equity
Dividends
During each of the first and second quarters of 2026, the Company paid dividends per share of $ .14 . During the first and second quarters of 2025, the Company paid dividends per share of $ .25 and $ .14 , respectively.
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 six months ended June 28, 2026, no shares were repurchased under the January 2023 Authorization. During the six months ended June 28, 2026, the Company paid $ 1,922 in excise tax on shares repurchased during 2025. As of June 28, 2026, the Company had $ 35,000 of availability remaining under the January 2023 Authorization.
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.
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THE WENDY’S COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
Accumulated Other Comprehensive Loss
The following table provides a rollforward of accumulated other comprehensive loss, which is entirely comprised of foreign currency translation:
Six Months Ended
June 28,
2026 June 29,
2025
Balance at beginning of period $ ( 63,968 ) $ ( 74,753 )
Foreign currency translation
( 6,784 ) 12,217
Balance at end of period $ ( 70,752 ) $ ( 62,536 )
(10) System Optimization Gains, Net
The Company optimizes the Wendy’s system by facilitating franchisee-to-franchisee restaurant transfers (“Franchise Flips”), evaluating strategic acquisitions of franchised restaurants and strategic dispositions of Company-operated restaurants to existing and new franchisees and, at times, closing certain underperforming restaurants, to further strengthen the franchisee base, support franchisee economics and drive new restaurant development. During the six months ended June 28, 2026 and June 29, 2025, the Company facilitated 45 and one Franchise Flips, respectively. Additionally, during the six months ended June 28, 2026 and June 29, 2025, the Company completed the sale of four and two Company-operated restaurants to franchisees, respectively.
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 Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Number of restaurants sold to franchisees 1 — 4 2
Proceeds from sales of restaurants (a) $ 588 $ — $ 2,392 $ 55
Net assets sold (b) ( 567 ) — ( 2,139 ) ( 169 )
Other ( 21 ) — ( 253 ) ( 25 )
Loss on sales of restaurants, net — — — ( 139 )
Post-closing adjustments on sales of restaurants — ( 10 ) — ( 10 )
Loss on sales of restaurants, net — ( 10 ) — ( 149 )
Gain on sales of other assets, net (c) 667 397 2,292 446
System optimization gains, net $ 667 $ 387 $ 2,292 $ 297
_______________
(a) During the three and six months ended June 28, 2026, the Company received net cash proceeds of $ 588 and $ 2,392 , respectively, related to the sale of Company-operated restaurants as part of the Company’s strategic build to suit development fund. These proceeds are included within operating activities in the Company’s condensed consolidated statements of cash flows.
(b) Net assets sold consisted primarily of equipment.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
(c) During the three and six months ended June 28, 2026, the Company received net cash proceeds of $ 1,868 and $ 4,664 , respectively, primarily from the sale of surplus and other properties. 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.
Assets Held for Sale
As of June 28, 2026 and December 28, 2025, the Company had assets held for sale of $ 27,152 and $ 3,696 , respectively, primarily consisting of surplus properties. Assets held for sale are included in “Prepaid expenses and other current assets.”
(11) Reorganization and Realignment Costs
The following is a summary of the initiatives included in “Reorganization and realignment costs:”
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Organizational Redesign Plan $ 3 $ 106 $ ( 198 ) $ ( 844 )
Other reorganization and realignment plans 7 68 46 326
Reorganization and realignment costs $ 10 $ 174 $ ( 152 ) $ ( 518 )
Organizational Redesign
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 a new President and Chief Executive Officer and the departure of the Company’s previous President and Chief Executive Officer. During the six months ended June 28, 2026 and June 29, 2025, the Company recognized costs totaling $( 198 ) and $( 844 ), respectively, which primarily included reversals of severance accruals. The Company does not expect to incur any material additional costs under the Organizational Redesign Plan.
The following is a summary of the costs recorded as a result of the Organizational Redesign Plan:
Three Months Ended Six Months Ended Total Incurred Since Inception
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Severance and related employee costs (a) $ — $ ( 6 ) $ ( 228 ) $ ( 1,094 ) $ 12,098
Recruitment and relocation costs — — — 13 736
Third-party and other costs — — — — 1,116
— ( 6 ) ( 228 ) ( 1,081 ) 13,950
Share-based compensation (b) 3 112 30 237 2,530
Total organizational redesign $ 3 $ 106 $ ( 198 ) $ ( 844 ) $ 16,480
_______________
(a) The six months ended June 28, 2026 and June 29, 2025 include reversals of severance accruals as a result of changes in estimates.
(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.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
As of June 28, 2026, 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.
Balance
December 28,
2025
Charges Payments Balance
June 28,
2026
Severance and related employee costs $ 378 $ ( 228 ) $ ( 144 ) $ 6
Recruitment and relocation costs — — — —
Third-party and other costs — — — —
$ 378 $ ( 228 ) $ ( 144 ) $ 6
Balance
December 29,
2024 Charges Payments Balance
June 29,
2025
Severance and related employee costs $ 4,257 $ ( 1,094 ) $ ( 1,897 ) $ 1,266
Recruitment and relocation costs — 13 ( 13 ) —
Third-party and other costs — — — —
$ 4,257 $ ( 1,081 ) $ ( 1,910 ) $ 1,266
Other Reorganization and Realignment Plans
Costs incurred under the Company’s other reorganization and realignment plans were not material during the six months ended June 28, 2026 and June 29, 2025. The Company does not expect to incur any material additional costs under these plans.
(12) Impairment of Long-Lived Assets
The Company records impairment charges as a result of (1) the deterioration in operating performance of certain Company-operated restaurants, (2) the Company’s decision to lease and/or sublease properties to franchisees in connection with the sale or anticipated sale of Company-operated restaurants, including any subsequent lease modifications and (3) classifying surplus properties as held for sale.
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 Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Company-operated restaurants $ 2,611 $ 1,686 $ 3,780 $ 2,873
Restaurants leased or subleased to franchisees 179 — 1,537 —
Surplus properties 330 — 375 234
$ 3,120 $ 1,686 $ 5,692 $ 3,107
(13) Supplemental Cash Flow Information
The following table includes supplemental non-cash investing and financing activities:
Six Months Ended
June 28,
2026 June 29,
2025
Supplemental non-cash investing and financing activities:
Capital expenditures included in accounts payable $ 5,740 $ 7,166
Finance leases 31,646 29,347
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
The following table includes a reconciliation of cash, cash equivalents and restricted cash:
June 28,
2026 December 28,
2025
Reconciliation of cash, cash equivalents and restricted cash at end of period:
Cash and cash equivalents $ 341,211 $ 300,833
Restricted cash 38,786 39,207
Restricted cash, included in Advertising funds restricted assets 14,783 17,632
Total cash, cash equivalents and restricted cash $ 394,780 $ 357,672
(14) Guarantees and Other Commitments and Contingencies
Except as described below, the Company did not have any significant changes in guarantees and other commitments and contingencies during the current fiscal period since those reported in the Form 10-K. Refer to the Form 10-K for further information regarding the Company’s additional commitments and obligations.
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 $ 99,500 as of June 28, 2026. These leases extend through 2045. We have had no judgments against us as guarantor of these leases as of June 28, 2026. 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 June 28, 2026.
Letters of Credit
As of June 28, 2026, the Company had outstanding letters of credit with various parties totaling $ 29,185 . Substantially all of the outstanding letters of credit include amounts outstanding against the 2021-1 Variable Funding Senior Secured Notes, Class A-1. We do not expect any material loss to result from these letters of credit.
(15) Transactions with Related Parties
Except as described below, the Company did not have any significant changes in or transactions with its related parties during the current fiscal period since those reported in the Form 10-K.
TimWen Lease and Management Fee Payments
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 $ 10,126 and $ 10,344 under these lease agreements during the six months ended June 28, 2026 and June 29, 2025, 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 $ 118 and $ 115 during the six months ended June 28, 2026 and June 29, 2025, respectively, which is included as a reduction to “General and administrative.”
Transactions with Yellow Cab
Certain family members and/or affiliates of Mr. Nelson Peltz, our former Chairman and Chairman Emeritus, Mr. Peter May, our Senior Vice Chairman, and Mr. 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 28, 2026 owned and operated 87 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 28, 2026 and June 29, 2025, the Company recognized $ 7,822 and $ 7,588 , 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
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
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 June 28, 2026 and December 28, 2025, $ 1,338 and $ 1,045 , 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
Ms. Kristin Dolan, a director of the Company until May 2026, serves as the Chief Executive Officer of AMC Networks Inc. (“AMC”). During the six months ended June 29, 2025, the Company purchased approximately $ 600 of advertising time from a subsidiary of AMC. During the six months ended June 28, 2026, no advertising time was purchased 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. There were no amounts due to AMC as of June 28, 2026 and December 28, 2025.
(16) Legal and Environmental Matters
The Company is involved in litigation and claims incidental to our business. We provide accruals for such litigation and claims when we determine it is probable that a liability has been incurred and the loss is reasonably estimable. The Company believes it has adequate accruals for all of its legal and environmental matters. We cannot estimate the aggregate possible range of loss for our existing litigation and claims due to various reasons, including, but not limited to, many proceedings being in preliminary stages, with various motions either yet to be submitted or pending, discovery yet to occur and significant factual matters unresolved. In addition, most cases seek an indeterminate amount of damages and many involve multiple parties. Predicting the outcomes of settlement discussions or judicial or arbitral decisions is thus inherently difficult and future developments could cause these actions or claims, individually or in aggregate, to have a material adverse effect on the Company’s financial condition, results of operations, or cash flows of a particular reporting period.
(17) Segment Information
Wendy’s U.S. revenue, significant segment expenses and segment adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) are as follows:
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Wendy’s U.S. revenue $ 477,597 $ 461,142 $ 921,756 $ 890,756
Wendy’s U.S. expense
Cost of sales 201,605 189,258 395,901 370,495
Franchise support and other costs 17,275 13,677 35,531 26,855
Advertising fund expense 117,715 101,355 216,988 193,115
General and administrative 20,516 19,619 42,974 42,043
Other segment items (a) 12 74 25 112
Wendy’s U.S. adjusted EBITDA $ 120,474 $ 137,159 $ 230,337 $ 258,136
_______________
(a) Other segment items for the three and six months ended June 28, 2026 and June 29, 2025 primarily include professional fees.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
Wendy’s International revenue, significant segment expenses and segment adjusted EBITDA are as follows:
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Wendy’s International revenue $ 39,266 $ 38,850 $ 76,193 $ 73,571
Wendy’s International expense
Cost of sales 5,670 7,263 12,423 14,195
Advertising fund expense (a) 10,459 10,159 19,530 20,071
General and administrative 7,392 6,700 15,617 13,137
Other segment items (b) 3,822 1,502 6,121 3,498
Wendy’s International adjusted EBITDA $ 11,923 $ 13,226 $ 22,502 $ 22,670
_______________
(a) Includes advertising fund expense of $ 183 and $ 342 for the three and six months ended June 29, 2025, 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 28, 2026. In addition, includes other international-related advertising (deficit) surplus of $( 753 ) and $( 756 ) for the three and six months ended June 28, 2026, respectively, and $ 34 and $( 1,119 ) for the three and six months ended June 29, 2025, respectively.
(b) Other segment items primarily include franchise support and other costs.
Global Real Estate & Development revenue, significant segment expenses and segment adjusted EBITDA are as follows:
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Global Real Estate & Development revenue $ 53,708 $ 60,937 $ 113,259 $ 120,074
Global Real Estate & Development expense
Franchise rental expense 28,039 32,630 58,215 63,331
General and administrative 3,104 2,650 8,401 7,870
Other segment items (a) ( 4,898 ) ( 1,627 ) ( 8,872 ) ( 3,087 )
Global Real Estate & Development adjusted EBITDA $ 27,463 $ 27,284 $ 55,515 $ 51,960
_______________
(a) Other segment items for the three and six months ended June 28, 2026 primarily include equity in earnings from our TimWen joint venture and lease buyout activity. Other segment items for the three and six months ended June 29, 2025 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 $ 3,173 and $ 5,536 for the three and six months ended June 28, 2026, respectively, and $ 3,060 and $ 5,312 for the three and six months ended June 29, 2025, respectively.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Per Share Amounts)
The following table reconciles profit by segment to the Company’s consolidated income before income taxes:
Three Months Ended Six Months Ended
June 28,
2026 June 29,
2025 June 28,
2026 June 29,
2025
Wendy’s U.S. $ 120,474 $ 137,159 $ 230,337 $ 258,136
Wendy’s International 11,923 13,226 22,502 22,670
Global Real Estate & Development 27,463 27,284 55,515 51,960
Total segment adjusted EBITDA 159,860 177,669 $ 308,354 $ 332,766
Unallocated franchise support and other costs ( 769 ) ( 658 ) ( 1,079 ) ( 1,245 )
Advertising funds surplus 295 140 24 284
Unallocated general and administrative (a) ( 35,149 ) ( 30,516 ) ( 72,012 ) ( 64,639 )
Depreciation and amortization (exclusive of amortization of cloud computing arrangements shown separately below) ( 38,061 ) ( 36,990 ) ( 78,636 ) ( 73,539 )
Amortization of cloud computing arrangements ( 4,577 ) ( 4,056 ) ( 9,339 ) ( 8,223 )
System optimization gains, net 667 387 2,292 297
Reorganization and realignment costs ( 10 ) ( 174 ) 152 518
Impairment of long-lived assets ( 3,120 ) ( 1,686 ) ( 5,692 ) ( 3,107 )
Unallocated other operating income, net 148 144 141 4,274
Interest expense, net ( 33,850 ) ( 30,945 ) ( 67,956 ) ( 62,422 )
Investment loss, net — — — ( 1,718 )
Other income, net 3,133 2,585 6,483 7,571
Income before income taxes $ 48,567 $ 75,900 $ 82,732 $ 130,817
_______________
(a) Includes corporate overhead costs, such as employee compensation and related benefits.
(18) New Accounting Standards
Measurement of Credit Losses for Accounts Receivable and Contract Assets
In July 2025, the Financial Accounting Standards Board (“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 Company adopted this amendment during the first quarter of 2026 and has elected the practical expedient to assume that the current conditions as of the balance sheet date will remain unchanged for the remaining life of the receivables when estimating expected credit losses. The adoption of this amendment did not have a material impact on our condensed consolidated financial statements.
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