Restaurant Brands 2025 Q2 Earnings EPS Falls 34.8% Despite Revenue Growth

Restaurant Brands International reported fiscal 2025 Q2 earnings on August 7, 2025, with revenue rising 15.9% year-over-year but EPS falling well below prior levels. While revenue beat expectations, the decline in earnings reflected ongoing cost pressures and U.S. market challenges. The company maintained its full-year guidance of at least 8% organic adjusted operating income growth.

Revenue
The total revenue for Restaurant Brands climbed to $2.41 billion in 2025 Q2, a 15.9% increase from $2.08 billion in the prior year. Tim Hortons (TH) led the charge with $1.08 billion in revenue, while Burger King (BK) and Popeyes (PLK) reported $388 million and $210 million, respectively. Firehouse Subs (FHS) brought in $59 million, and international operations (INTL) contributed $250 million. Restaurant Holdings (RH) added $469 million, though intercompany eliminations (ELIM) reduced the total by $49 million.

Earnings/Net Income
Earnings per share (EPS) dropped 34.8% year-over-year to $0.58, while net income fell 34.1% to $263 million. Despite the decline, the company remains profitable for the 12th consecutive year, demonstrating resilience amid economic headwinds. The drop in earnings reflects higher costs and operational challenges, particularly in the U.S. market.

Price Action
Shares of Restaurant Brands declined across all measured timeframes, with a 4.44% drop in the most recent trading day, a 4.11% weekly decline, and a 4.59% pullback month-to-date.

Post Earnings Price Action Review
The buy-and-hold strategy of purchasing Restaurant Brands shares following a revenue beat has historically outperformed the market over a 30-day period. Over the past three years, the strategy generated a total return of 30.5% versus the market's 28.8%, with an average annual return of 10.2%. However, the approach exhibited higher volatility, with a beta of 1.3, underscoring the restaurant sector's sensitivity to macroeconomic and consumer trends.

CEO Commentary
John Chlebicki, CEO of Restaurant Brands International, highlighted a mixed Q2 performance, with strong international expansion and operational gains at Tim Hortons and Firehouse Subs. Challenges at Burger King and Popeyes in the U.S. remain, but the company is focused on modernizing restaurant designs, improving digital capabilities, and achieving cost efficiencies. Chlebicki expressed cautious optimism for the remainder of the year.

Guidance
Restaurant Brands reaffirmed its full-year guidance, aiming for at least 8% organic adjusted operating income growth in 2025. The company is targeting over 85% modern image adoption at Burger King U.S. locations by 2028 and expects general and administrative savings of $20 million year-over-year.

Additional News
In the week following the earnings report, Restaurant Brands announced plans to accelerate the digital transformation of Firehouse Subs, including a new app and loyalty program launch. The company also confirmed the continuation of its share repurchase program, with $250 million remaining under its existing authorization. Additionally, Restaurant Brands announced the appointment of a new Chief Marketing Officer, signaling a strategic pivot toward brand modernization and customer engagement.