What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2026-02-20 compared with 2025-02-19 · 31 added, 29 removed, 161 unchanged (27% of the section changed)

7 unchanged sentences

Overview of Business

YUM has over 61,000 restaurants in more than 155 countries and territories primarily operating under the four concepts of KFC, Taco Bell, Pizza Hut and Habit Burger & Grill (the “Concepts”).

YUM has over 63,000 restaurants in 155 countries and territories primarily operating under the four concepts of KFC, Taco Bell, Pizza Hut and Habit Burger & Grill (the “Concepts”).

The Company’s KFC, Taco Bell and Pizza Hut brands are global leaders of the chicken, Mexican-inspired food and pizza categories, respectively.

2 unchanged sentences

The terms franchise or franchisee within this Form 10-K are meant to describe third parties that operate units under either franchise or license agreements.

In 2025, we began a review of strategic options for the Pizza Hut brand.

The objective of the review is to create value for YUM, Pizza Hut and its franchise partners by determining the optimal approach to best capitalize on Pizza Hut's structural advantages — strong brand equity, experienced franchise partners and meaningful scale — in the highly fragmented pizza market.

We currently intend to complete this strategic options review in 2026, and there can be no assurance this review will result in any specific outcome or transaction.

The following is a brief description of each Concept and a summary of our Concepts’ operations as of and for the year ended December 31, 2025:

20 unchanged sentences

Business Strategy

Through our Recipe for Good Growth we intend to deliver iconic restaurant brands and consistently drive better customer experiences, improved unit economics and higher rates of growth.

Key enablers include accelerated use of digital and technology, increased collaboration and better leverage of our systemwide scale.

This is done through a framework of three pillars:

being Loved, Trusted and Connected.

We grow by delighting customers with craveable food and a distinctive experience.

We innovate and elevate our iconic restaurant brands that people trust and champion, resulting in relevant, easy and distinctive brands.

Through our Recipe for Good Growth we strive to grow iconic restaurant brands around the world that are loved by our customers, trusted everywhere we operate and connected through teamwork, technology and our global scale.

These three ideas - being loved, trusted and connected - guide how we operate across our global system and engage with our customers, teams and communities:

We grow by delighting customers with craveable food and distinctive experiences.

We operate responsibly with consistency and efficiency in our restaurants, across our system and in our communities.

This includes a commitment to our priorities for social responsibility, risk management and sustainable stewardship of our people, food and planet.

This includes a commitment to our priorities for social responsibility, risk management and sustainable stewardship of resources.

We use our teamwork, technology and global scale to serve every customer, everywhere, anytime.

Our unmatched operating capability allows us to recruit and equip the best restaurant operators in the world to deliver great customer experiences.

And our commitment to bold restaurant development drives market and franchise unit expansion with strong economics.

Our unrivaled culture and talent and leading with smart, heart and courage are key to our success, fueling brand performance and franchise success.

As we enter into 2026, we intend to drive the next chapter of growth for YUM by Raising the B.A.R.

through three clear priorities that reflect bold aspirations and a commitment to industry-leading performance:

• B attle for the future consumer by staying relentlessly focused on their needs and wants.

• A ccelerate restaurant unit economics for our franchisees and maximize performance of every restaurant, serving as a catalyst for new unit development and keeping our franchise system healthy.

• R each the full potential of Byte by Yum!

by effectively operating, innovating and expanding our connected platform built by restaurant operators for restaurant operators to unlock its full potential for our franchise partners and our business.

Key to our success fueling brand performance and franchise success is our unrivaled culture and talent and leading with smart, heart and courage.

Information about Operating Segments

19 unchanged sentences

Master franchisees are typically responsible for overseeing development within their territories and performing certain other administrative duties with regard to the oversight of sub-franchisees.

master franchisees retain a certain percentage of fees payable by the sub-franchisees under their franchise agreements and often pay lower fees for the restaurants they operate.

In exchange, master franchisees retain a certain percentage of fees payable by the sub-franchisees under their franchise agreements and often pay lower fees for the restaurants they operate.

On October 31, 2016, we completed the spin-off of our China business into an independent, publicly-traded company under the name of Yum China Holdings, Inc.

1 unchanged sentence

As our largest master franchisee, Yum China, pays the Company a continuing fee of 3% on system sales of our Concepts in mainland China.

The use by Yum China of certain of our material trademarks and service marks is governed by a master license agreement between Yum Restaurants Consulting (Shanghai) Company Limited, a wholly-owned indirect subsidiary of Yum China, and YUM, through YRI China Franchising LLC, a subsidiary of YUM.

The use by Yum China of certain of our material trademarks and service marks is governed by a master license agreement between subsidiaries of YUM and Yum China.

The Company seeks to maintain strong and open relationships with our franchisees and their representatives.

13 unchanged sentences

Digital and technology are at the core of our Recipe for Good Growth.

In recent years the Company has focused on building and acquiring a distinctive set of solutions with next-generation capabilities tailored for our brands and scaling these common digital and technology platforms across the globe.

In 2024, we accelerated our technology transformation by integrating our digital and technology teams into a unified global team.

Additionally, we have introduced our Byte by Yum!

In recent years the Company has focused on building and acquiring a distinctive set of solutions with next-generation capabilities tailored for our brands, scaling these common digital and technology platforms across the globe and integrating our digital and technology teams into a unified global team.

In 2025, we introduced our Byte by Yum!

platform, a comprehensive collection of proprietary software as a service and artificial intelligence (“AI”) driven products that enables easy operations for team members and improved experiences for customers, while consolidating essential systems into a cohesive, easy-to-manage platform.

4 unchanged sentences

Digital sales include transactions where consumers at system restaurants utilize ordering interaction that is primarily facilitated by automated technology.

In 2024, our system restaurants generated digital sales of $33 billion, representing over 50% of overall system sales.

In 2025, our system restaurants generated digital sales approaching both $40 billion and 60% of overall system sales.

The Company and its Concepts own numerous registered trademarks.

18 unchanged sentences

is the distributor for the majority of items used in Company-owned restaurants and for a substantial number of franchisee restaurants.

Outside the U.S., we and our Concepts’ franchisees primarily use decentralized sourcing and distribution systems involving many different global, regional and local suppliers and distributors.

Our international franchisees generally select and manage their own third-party suppliers and distributors, subject to our internal standards.

Outside the U.S., we and our Concepts’ franchisees primarily use aligned and leveraged sourcing and distribution systems involving global, regional and local suppliers and distributors.

The Company partners with our international franchisees to manage third-party suppliers and distributors, subject to our internal standards and approvals.

All suppliers and distributors are expected to provide products and/or services that comply with all applicable laws, rules and regulations in the state and/or country in which they operate as well as comply with our internal standards.

44 unchanged sentences

Approximately 90% of our employees work in restaurants while the remainder work in our restaurant-support centers.

In the U.S., approximately 85% of our Company-owned restaurant employees are part-time and approximately 40% have been employed by the Company for less than a year.

Some of our International employees are subject to labor council relationships whose terms vary due to the diverse countries in which the Company operates.

In the U.S., approximately 90% of our Company-owned restaurant employees are part-time of which approximately 50% have been employed by the Company for less than a year.

Some of our International employees are subject to labor council relationships whose terms vary due to the multitude of countries in which the Company operates.

In addition to the persons employed by the Company and its subsidiaries, our approximately 61,000 franchise restaurants around the world are responsible for the employment of over an estimated 1 million people who work in and support those restaurants.

Each year YUM and our franchisees around the world create thousands of restaurant jobs, which are part-time, entry-level opportunities to grow careers at our KFC, Taco Bell, Pizza Hut and Habit Burger & Grill brands.

As evidence of the opportunities these positions create, approximately 80% of the Company-owned Restaurant General Managers (“RGMs”)

located in the U.S.

have been promoted from other positions in our brands’ restaurants and such RGMs often earn pay greater than the average American household income.

Human capital management considerations are integral to our Recipe for Good Growth strategy, the drivers of which include leveraging our culture and people capability to fuel brand performance and franchise success, as well as recruiting and equipping the best restaurant operators in the world to deliver great customer experiences.

Each year YUM and our franchisees around the world create thousands of part-time, entry-level restaurant opportunities to grow careers at our KFC, Taco Bell, Pizza Hut and Habit Burger & Grill brands.

As evidence of the opportunities these positions create, approximately 80% of the Company-owned restaurant general managers (“RGMs”) located in the U.S.

have been promoted from other positions in our brands’ restaurants.

Human capital management considerations are integral to our Recipe for Good Growth strategy, the drivers of which include leveraging our unrivaled culture and talent to fuel brand performance and franchise success, as well as recruiting and equipping the best restaurant operators in the world to deliver great customer experiences.

Our investment in people includes creating a culture of engagement that attracts, retains and grows the best people and creates high performance in our restaurants.

We are also highly focused on building an inclusive culture among our employees, franchisees, suppliers and partners that reflects all of our customers and communities, which we believe provides us with a competitive advantage with respect to the performance of our business.

Our commitments and progress towards our vision of culture, opportunity and belonging are reflected below.

We are continuing to build a culture of opportunity and belonging among our employees, franchisees, suppliers and partners that makes room for all people and voices at our tables that reflects the customers and communities we serve, which we believe provides us with a competitive advantage with respect to the performance of our business.

Our commitments and progress towards these areas of focus are reflected below.

• Continually building upon ongoing inclusion efforts to help ensure our workplaces are environments where all people can be successful.

2 unchanged sentences

For example, every other year we conduct a global employee engagement survey of all employees working in our restaurant support centers.

The most recent survey conducted was in 2023 and reflected an engagement level among our employees significantly exceeding the average engagement levels of benchmarked companies.

The most recent survey conducted was in 2025 and reflected an above-average engagement level among our employees relative to benchmarked companies.

• Providing YUM employees with training and development that builds world-class leaders and drives business results.

7 unchanged sentences

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-K

Item 1. Business