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Wendy’s boosts sales forecast

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Myles Udland and Julie Hyman discuss Wendy’s raising 2021 outlook after reporting an earnings beat fueled by same-store sales

Video Transcript

MYLES UDLAND: Let's finish out this segment talking a little bit about food. Wendy's out with their latest quarterly results. The company reporting system-wide sales growth, 20.6% in the most recent quarter. Top line, beating. Bottom line, beating here. Same restaurant sales growth-- up 16% in the US in the second quarter.

And a couple interesting nuggets here in Wendy's release. They are adding $10 million of spending towards their breakfast advertising. And we have talked to a lot of quick-service executives on this program, as you do when you work alongside Brian Sozzi, about the breakfast day part maybe being a little more of a focus for a number of brands. Just talked to CEO of Panera brands earlier this week.

They also said they are-- they're basically developing ghost kitchens here is kind of how I'm reading this. A commitment by Reef to open and operate 700 delivery kitchens over the next five years. So they've tested eight delivery kitchens that opened in Canada. They expect approximately 50 of these kitchens will open in 2021 and the remainder between 2022 and 2025. They're looking at 8,500 to 9,000 global-- of these facilities globally.

So Julie, we have heard for a long time about how ghost kitchens are gonna be the future. I'm skeptical, because I think that's a strange concept. But maybe that's just me being, you know, a Luddite or whatever. I guess if it's a Wendy's-backed ghost kitchen, then it's just a smaller Wendy's. So I guess that's fine.

JULIE HYMAN: Yeah, I mean, that sort of makes sense. And as you say, is sort of in line with what we heard from Panera and the smaller footprints.

MYLES UDLAND: Yeah.

JULIE HYMAN: And if-- if delivery and-- if delivery is really the wave of the future, then that makes a lot of sense.

MYLES UDLAND: I guess another way to say it is, if Wendy's wants to go and develop ghost kitchens, they know how to make food. When Travis Kalanick tells me he's gonna go do--

JULIE HYMAN: Right. [GIGGLES]

MYLES UDLAND: --ghost kitchens, I'm less excited. I'm less excited about the Uber guy saying, ghost kitchens are the future. I'm a little more interested in Wendy's or another food business telling me that they might be part of the future. So we'll see how-- we'll see how that shakes out in the years ahead, which I guess inevitably means we'll all be ordering from these kinds of places. All right--