Pizza Hut is falling in the global race

Yum Brands – the company that owns the Pizza Hut chain, recently announced its plan to close 250 stores in the US in the first half of 2026. Accordingly, the group headquartered in Louisville (Kentucky) will select ineffective branches in more than 6,000 points of sale in the country to streamline the system by 3%.

Pizza Hut was founded in 1958 in Wichita, Kansas (USA). PepsiCo acquired the chain in 1977, before separating the restaurant segment in 1997 and becoming Yum Brands. In addition to Pizza Hut, Yum Brands currently owns KFC, Taco Bell and Habit Burger & Grill.

Not only is it downsizing its system, Yum Brands is also signaling the sale of Pizza Hut. Taking the hot seat in October 2025, Yum Brands CEO Chris Turner has shown no longer interest in Pizza Hut, when the proportion of operating profit that this brand contributes to Yum has decreased to 11%, from 17% at the beginning of 2023.

Therefore, after only a month in office, Mr. Chris Turner began reviewing options for Pizza Hut, an activity that is often intended to pave the way for selling the brand. On February 4, he planned to complete this work this year.

By the end of 2025, Pizza Hut has 19,974 stores globally, down 251 stores compared to the previous year. Despite opening nearly 1,200 stores in 65 countries last year, Pizza Hut still closed more stores than opened new ones.

This is the lagging brand in Yum Brands’ portfolio, recording a 1% decrease in global revenue at existing stores in the fourth quarter of 2025. In particular, the US market decreased by 3%, higher than Wall Street’s forecast of 1.7%. Meanwhile, rival Domino’s Pizza – the world’s largest pizza company, has not announced its final quarter results, but sales in the US increased by 2.7% in the first 9 months of 2025.

Pizza Hut’s declining performance comes from many reasons, revolving around the ability to adapt and innovate in the context of consumers tightening spending and other chains strongly upgrading points of sale.

First, rival pizza chains were early to wake up to Americans’ thrifty tendencies, and Pizza Hut was slow to the price war. In August 2025, Yum Brands leaders admitted that Pizza Hut has “a value message that is not prominent enough in the context of fierce price competition”.

Analysts also agree. RJ Hottovy, head of research at Placer, says Pizza Hut has fallen behind rivals “because their value message is not as prominent as Domino’s and Papa Johns.”

At that time, the brand had a series of 7 consecutive quarters of declining sales in the US. To turn the situation around, Pizza Hut stepped up promotions, such as extending the $2 personal pizza program on Tuesdays and chicken wings on Wednesdays.

Next, they launched “Crafted Flatzz”, a thinner and crispier version of Personal Pan Pizza, for $5. This type of pizza is only available for a limited time, targeting budget-minded lunch customers. However, the effort to focus on value with a $5 pizza product “fell short of expectations,” according to CNN.

The second reason is that the franchise model is “locking down” Pizza Hut’s ability to innovate compared to Domino’s and other chains. Historically, chains have been able to successfully transform themselves if the franchise partner has strong resources.

During 2010–2015, Domino’s invested heavily in online ordering, delivery tracking, and store renovations. Or McDonald’s restructuring under CEO Steve Easterbrook cost about $6 billion, largely funded by franchisees. Both of these cases were successful partly because the store investor system was strong enough to shoulder the costs.

On the contrary, Yum Brands’ partners continuously encountered difficulties. Every time it wants to close, change models or adjust prices, the group must negotiate with independent franchisees of nearly 20,000 Pizza Hut stores. The problem is that these units are increasingly struggling.

In early 2025, 77 Pizza Hut stores of EYM partner in the US were sold off for about 12 million USD. In October of the same year, DC London Pie, the UK operator of Pizza Hut, opened bankruptcy proceedings to restructure, submitting a plan to close 68 restaurants and 11 delivery points to the court.

To save the day, Yum Brands was forced to take over 64 restaurants in the UK, thereby retaining 1,276 jobs. “This selective acquisition is intended to protect the customer experience and retain jobs to the maximum extent possible,” Nicolas Burquier, Yum Brands’ chief executive officer of international markets, said at the time.

Just last month, Devyani International – the operator of KFC and Pizza Hut in India, announced a sharp increase in losses in the fourth quarter of 2025. Sales at Devyani’s Pizza Hut stores decreased 9.1% over the same period, down sharply from 4.1% in the previous quarter. Meanwhile, KFC’s store sales decreased by 2.9%, an improvement compared to the 4.2% decrease in the third quarter.

Yum Brands said Pizza Hut plans to continue expanding globally in 2026, but did not disclose details. Meanwhile, the long-term desire to resell this chain is considered reasonable. According to Reutersselling Pizza Hut to focus on Taco Bell and KFC seems to be a more “palatable” financial option.

“We currently intend to complete our review of strategic options for Pizza Hut this year. Due to the ongoing nature of this process, we cannot share further details,” Yum Brands CEO Chris Turner said in announcing fourth quarter 2025 business results.