Restaurant Brands International reports Q4 earnings, names new CEO

Yahoo Finance Live anchors discuss the decline in stock for Burger King parent Restaurant Brands International following fourth-quarter earnings, as well as news that Joshua Kobza will succeed José Cil as CEO.

Video Transcript

BRIAN SOZZI: Restaurant Brands International announces a shakeup in its c-suite as the company announces earnings that slightly missed analysts' estimates. The company's chief operating Officer Josh Kabza was appointed as Restaurant Brand's new CEO effective March 1, 2023. And this one surprised me a bit.

Jose Cil, current CEO of Restaurant Brands, a long time friend of our show, starred in 2019 has been reinventing the company here, has driven a successful turnaround, I would say at Tim Hortons. Nobody's talking about it, but the numbers there continue to be strong in this most recent quarter. Start to reinvent Burger King as well refocusing on operations there.

But I do think this has all the fingerprints of new executive chairman at Restaurant Brands, Patrick Doyle, the, I would say, legendary former CEO of Domino's. He joined that board in late November. I think he wants to just continuing to improve operations, maybe move a little quicker on some things.

Now, Jose messaged me this morning here, a brief exchange. He said he's not stepping aside, he's just a little bit moving out of the way so the next generation of leadership could take that CEO mantle. But again, I would say Jose did a very good job, and I appreciate him always coming on with us.

JULIE HYMAN: Just to emphasize, this is a surprise.

BRIAN SOZZI: Yes--

JULIE HYMAN: Right? I don't think any of us-- and you follow, especially, this company pretty closely-- Jose stepping aside is a surprise. He's only been in the CEO spot-- he's been with the company for longer, he's only been in the CEO spot since January of 2019. And I was looking at the stock performance since then.

The stock's up in the neighborhood of 33% or so, which is an underperformance, it's about half the gain in the S&P 500. It's also about half the gain in the S&P restaurant subindex, which has a lot of his peers. So the stock has underperformed. And frankly, the earnings today were not fantastic either-- earnings per share missed estimates.

BRAD SMITH: Yeah, and the stock is reflecting that this morning, down by about 3% premarket. A few of the bright spots though, and you guys know I love to talk about that Popeye's chicken sandwich because it's practically family at this point, but they had a really strong growth in terms of the number of different locations that they brought online for Popeye's. They're calling it the strongest development year since joining Restaurant Brands International, adding about 1,266 net new units with Popeye's there.

And so that was their kind of restaurant overall growth that they were talking about in that acceleration. Digital sales too-- you were just telling me about your frequency with which you order chicken sandwiches and the time of day will not disclose that that you are getting those chicken sandwiches. Those digital sales, though, grew 30% year over year, $13.5 billion there in 2022. You can--

BRIAN SOZZI: I will not mention that just yet, but I will just want to focus real quick on Josh's resume. He really checks all the boxes and what you would want to see from the next sea of Restaurant Brands. Chief financial officer for five years checked on at a time of ongoing inflation.

You want to see that Chief technology officer, that Burger King app needs to get better and he might be the one person do it. Chief Operating Officer for four years, very, very important. And perhaps most importantly, he was integral to the acquisitions of Tim Hortons, Popeyes, and Firehouse Subs. It is largely assumed that this company will continue to buy up various brands over the next couple of years. They certainly have the balance sheet to do it.

BRAD SMITH: Yeah, I mean new slogan year for Burger King. It was, you can have it your way" for the longest time, probably since I was in grade school. Now, it's, "you rule" so big reinvention year over at Burger King. We'll see if the digital side can continue to impress the one and only Brian Sozzi.