The Wendys 2025 Q3 Earnings Net Income Declines 11.9% Despite International Growth

The Wendy's (WEN) reported fiscal 2025 Q3 earnings on Nov 8, 2025, with revenue and EPS falling short of prior-year results. The company beat revenue estimates by 2.37% but missed EPS expectations due to a 11.9% net income decline. Guidance for 2025 was reaffirmed, with adjusted EBITDA and free cash flow outlooks raised amid cost-cutting and tax benefits.

Revenue

Wendy's total revenue decreased by 3.0% to $549.52 million in Q3 2025, with international growth offsetting U.S. weakness. Sales at company-operated restaurants led with $233.15 million, while franchise royalty revenue and fees contributed $152.01 million. Advertising funds revenue dipped to $107.01 million, and franchise rental income totaled $57.34 million.

Earnings/Net Income

The company’s EPS declined 8.0% to $0.23, with net income falling to $44.25 million, a 11.9% drop year-over-year. Both metrics underperformed the prior-year period, reflecting operational and market challenges.

Post-Earnings Price Action Review

The stock price of The Wendy's tumbled 8.47% during the latest trading day but showed resilience with a 5.04% weekly gain. Month-to-date, it edged down 0.11%, indicating mixed investor sentiment.

CEO Commentary

Interim CEO Ken Cook highlighted U.S. operational improvements, noting company-operated restaurants outperformed the system by 400 basis points. Project Fresh, focused on AUV growth and system optimization, includes closures of underperforming units and digital enhancements. International markets delivered 8.6% system-wide sales growth.

Guidance

Wendy’s maintained full-year 2025 guidance for adjusted EBITDA ($505–$525M) and adjusted EPS ($0.82–$0.89), while raising free cash flow to $195–$210M. The company also reaffirmed a $0.14/share dividend and $325M in shareholder returns.

Additional News

1. Store Closures: Wendy’s announced the closure of 200–350 underperforming U.S. locations by 2026 to boost profitability and redirect resources.

2. Shareholder Returns: The company plans $325M in 2025 shareholder returns, including a $0.14/share dividend and $14M in Q3 share repurchases.

3. Governance Update: By-law amendments were approved to streamline corporate governance, effective Nov 5, 2025.