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What changed in Wendy's Co's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Wendy's Co's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+373 added−370 removedSource: 10-K (2026-02-23) vs 10-K (2025-02-21)

Top changes in Wendy's Co's 2025 10-K

373 paragraphs added · 370 removed · 310 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

63 edited+8 added−10 removed71 unchanged
Biggest changeAdvertising and Marketing In the U.S. and Canada, Wendy’s advertises nationally through national advertising funds primarily on network and cable television programs, including nationally televised events, as well as through audio and digital media, and advertises locally primarily through regional network and cable television, audio and digital media and out-of-home media, such as billboards.
Biggest changeManagement’s Discussion and Analysis of Financial Condition and Results of Operations” herein, for information regarding certain guarantee obligations, reserves, commitments and contingencies involving franchisees. Advertising and Marketing In the U.S. and Canada, Wendy’s advertises nationally through national advertising funds primarily on television and digital media, as well as through audio and industrial media.
Additional competitive pressures for prepared food purchases come from operators outside the restaurant industry. A number of major grocery chains offer fresh deli sandwiches and fully prepared food and meals, including takeout options. Additionally, convenience stores and retail outlets at gas stations frequently offer a wide variety of sandwiches and other foods.
Additional competitive pressures for prepared food purchases come from operators outside the restaurant industry. A number of major grocery chains offer fresh deli sandwiches and fully prepared food and meals, including takeout options. Additionally, convenience stores and retail outlets at gas stations frequently offer a wide variety of sandwiches and other prepared foods.
Our leadership development program for Company employees (WeLead) uses a cohort learning strategy for emerging leaders over a six-month curriculum designed to build on our performance-driven culture and develop talent across the organization. Community-Based Giving Wendy’s maintains a charitable giving program that supports four core categories: foster care adoption; hunger and food integrity; youth and families; and vibrant communities.
Our leadership development program for Company employees (WeLead) uses a cohort learning strategy for emerging leaders over a six-month curriculum designed to build on our performance-driven culture and develop talent across the organization. 13 Community-Based Giving Wendy’s maintains a charitable giving program that supports four core categories: foster care adoption; hunger and food integrity; youth and families; and vibrant communities.
QSCC’s supply chain management facilitates the continuity of supply and provides consolidated purchasing efficiencies while monitoring and seeking to minimize possible obsolete inventory throughout the Wendy’s supply chain in the U.S. and Canada. Wendy’s and its franchisees pay sourcing fees to third-party vendors on certain products sourced by QSCC.
QSCC’s supply chain management facilitates the continuity of supply and provides consolidated purchasing 7 efficiencies while monitoring and seeking to minimize possible obsolete inventory throughout the Wendy’s supply chain in the U.S. and Canada. Wendy’s and its franchisees pay sourcing fees to third-party vendors on certain products sourced by QSCC.
Technology and delivery are critical parts of the restaurant consumer experience. In the quick-service restaurant category, technology initiatives include mobile interactive technology for brand and menu search information, mobile ordering, mobile payment, mobile offers, mobile order pick-up and carryout, customer loyalty and rewards programs, artificial intelligence (“AI”) and other self-service technologies.
Technology and delivery are critical parts of the restaurant consumer experience. In the quick-service restaurant category, technology initiatives include mobile interactive technology for brand and menu search information, mobile ordering, mobile 9 payment, mobile offers, mobile order pick-up and carryout, customer loyalty and rewards programs, artificial intelligence (“AI”) and other self-service technologies.
We are also proud to offer paid sick time at all levels within our restaurants to ensure employees can prioritize their health and the health of their families. 13 Talent Development To set our employees up for success and support their personal development and career growth, we invest in training and development programs at all levels within the Company.
We are also proud to offer paid sick time at all levels within our restaurants to ensure employees can prioritize their health and the health of their families. Talent Development To set our employees up for success and support their personal development and career growth, we invest in training and development programs at all levels within the Company.
QSCC manages, for the Wendy’s system in the U.S. and Canada, contracts for the purchase and distribution of food, proprietary paper, operating supplies and equipment, typically under national agreements with pricing based upon total 7 system volume.
QSCC manages, for the Wendy’s system in the U.S. and Canada, contracts for the purchase and distribution of food, proprietary paper, operating supplies and equipment, typically under national agreements with pricing based upon total system volume.
In certain circumstances, Wendy’s may charge an upfront development fee for a non-exclusive territory, which is proportionate to a multi-unit development commitment. Wendy’s may also grant a franchisee the right to sub-franchise in a stated territory, subject to certain conditions.
In certain circumstances, Wendy’s may charge an upfront fee for an exclusive territory, which is proportionate to a multi-unit development commitment in the territory. Wendy’s may also grant a franchisee the right to sub-franchise in a stated territory, subject to certain conditions.
Our commitment to these values is reflected in our Code of Business Conduct and Ethics, which applies to Company employees and directors, and in our Supplier Code of Conduct, which sets forth our expectations for key suppliers to the Wendy’s system in the U.S. and Canada.
Our commitment to these values is reflected in our Code of Ethics, which applies to Company employees and directors, and in our Supplier Code of Conduct, which sets forth our expectations for key suppliers to the Wendy’s system in the U.S. and Canada.
See Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Item 7 herein and Note 25 to the Consolidated Financial Statements contained in Item 8 herein for segment financial information. 6 The Wendy’s Restaurant System The revenues from our restaurant business are derived from two principal sources: (1) sales at Company-operated restaurants and (2) franchise-related revenues, including royalties, franchise fees, national advertising funds contributions and rents received from Wendy’s franchised restaurants.
See Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Item 7 herein and Note 26 to the Consolidated Financial Statements contained in Item 8 herein for segment financial information. 6 The Wendy’s Restaurant System The revenues from our restaurant business are derived from two principal sources: (1) sales at Company-operated restaurants and (2) franchise-related revenues, including royalties, franchise fees, national advertising funds contributions and rents received from Wendy’s franchised restaurants.
Continued price discounting, including the use of coupons and offers, in the quick-service restaurant industry and the emphasis on value menus could have an adverse impact on Wendy’s business.
Continued price discounting, including the use of coupons and offers, in the quick-service and broader restaurant industry and the emphasis on value menus could have an adverse impact on Wendy’s business.
Several chains have also sought to compete by targeting certain consumer groups, such as capitalizing on trends toward certain types of diets or dietary preferences (e.g., plant-based food, alternative proteins, low carbohydrate, low trans-fat, gluten free or antibiotic free) by offering menu items that are promoted as being consistent with such diets.
Several chains have also sought to compete by targeting certain consumer groups, such as capitalizing on trends toward certain types of diets or dietary preferences (e.g., plant-based food, alternative proteins, high-protein, low carbohydrate, low trans-fat, gluten free or antibiotic free) by offering menu items that are promoted as being consistent with such diets.
The number and location of restaurants, quality and speed of service, attractiveness of facilities, effectiveness of marketing and new product development by Wendy’s and its competitors are also important factors. The price charged for each menu item may vary from market to market (and within markets) depending on competitive pricing and the local cost structure.
The number and location of restaurants, quality and speed of service, attractiveness of facilities, effectiveness of marketing, new product development by Wendy’s and its competitors and technology and delivery are also important factors. The price charged for each menu item may vary from market to market (and within markets) depending on competitive pricing and the local cost structure.
Franchised restaurants are required to be operated under uniform operating standards and specifications relating to the selection, quality and preparation of menu items, signage, decor, equipment, uniforms, suppliers, maintenance and cleanliness of premises and customer service. Wendy’s monitors franchisee operations and inspects restaurants periodically to ensure that 11 required practices and procedures are being followed.
Franchised restaurants are required to be operated under uniform operating standards and specifications relating to the selection, quality and preparation of menu items, signage, decor, equipment, technology, uniforms, suppliers, maintenance and cleanliness of premises and customer service. Wendy’s monitors franchisee operations and inspects restaurants periodically to ensure that required practices and procedures are being followed.
An increasing number of restaurant chains have also introduced or expanded their restaurant delivery arrangements as another strategy to increase market share.
An increasing number of restaurant chains have also introduced or expanded their restaurant delivery arrangements as another strategy to increase or maintain market share.
Each Wendy’s restaurant offers an extensive menu specializing in hamburger sandwiches and featuring chicken sandwiches, which are prepared to order with the customer’s choice of toppings and condiments. Wendy’s menu also includes chicken nuggets, chili, french fries, baked potatoes, freshly prepared salads, soft drinks, Frosty ® desserts and kids’ meals.
Each Wendy’s restaurant offers an extensive menu specializing in hamburger sandwiches and featuring chicken sandwiches, which are prepared to order with the customer’s choice of toppings and condiments. Wendy’s menu also includes chicken tenders and nuggets, chili, french fries, baked potatoes, salads, soft drinks, Frosty ® desserts and kids’ meals.
If our technology initiatives, digital commerce 9 platforms or third-party delivery providers do not meet customers’ expectations in terms of security, speed, cost, attractiveness or ease of use, customers may be less inclined to use those platforms or providers and our competitive position could be adversely impacted.
If our technology initiatives, digital commerce platforms or third-party delivery providers do not meet customers’ expectations in terms of security, speed, cost, attractiveness, experience or ease of use, customers may be less inclined to use those platforms or providers and our competitive position could be adversely impacted.
The vast majority of our employees are located in the United States and work in our Company-operated restaurants within our Wendy’s U.S. business segment. Outside of our Company-operated restaurants, our largest population of employees are part of our restaurant support organization, which includes employees across the globe and at our restaurant support center in Dublin, Ohio.
The vast majority of our employees are located in the United States and work in our Company-operated restaurants within our Wendy’s U.S. business segment. Outside of our Company-operated restaurants, our largest population of employees are based at our restaurant support organization, which includes employees across the globe and at our restaurant support center in Dublin, Ohio.
Franchise Arrangements The rights and obligations governing the majority of franchised restaurants operating in the U.S. are set forth in the Wendy’s current Unit Franchise Agreement (the “Current Franchise Agreement”) (non-traditional locations may operate under an amended agreement or alternate form of agreement).
Franchise Arrangements The rights and obligations governing the majority of franchised restaurants operating in the U.S. are set forth in the Wendy’s current Unit Franchise Agreement (the “Current Franchise Agreement”) (non-traditional locations may operate under an amended agreement or alternate form of agr eement).
These filings are also available to the public on the Securities and Exchange Commission’s website at www.sec.gov. We also provide our Code of Business Conduct and Ethics, free of charge, on our website. Our corporate website address is www.wendys.com and our Investor Relations website address is www.irwendys.com. Information contained on those websites is not part of this Form 10-K. 15
These filings are also available to the public on the Securities and Exchange Commission’s website at www.sec.gov. We also provide our Code of Ethics, free of charge, on our website. Our corporate website address is www.wendys.com and our Investor Relations website address is www.irwendys.com. Information contained on those websites is not part of this Form 10-K.
This results in increased competition for available development sites and higher development costs for those sites. Competitors also employ marketing strategies such as frequent use of price discounting, frequent promotions and heavy advertising expenditures.
This results in increased competition for available development sites and higher development costs for those sites. Competitors also employ marketing strategies such as frequent use of price discounting, frequent promotions and significant advertising expenditures.
Restaurant managers and multi-unit operators also have the opportunity to participate in Wendy’s University, which includes targeted training to develop management and leadership skills at all levels. Wendy’s University also provides targeted programming for the Company’s corporate management employees, including onboarding, people manager training, work behavior assessments, leadership dialogues and the opportunity to participate in third party conferences and training.
Restaurant managers and multi-unit operators have the opportunity to participate in Wendy’s University, which includes targeted training to develop management and leadership skills at all levels. Wendy’s University also provides targeted programming for corporate management staff, including onboarding, people manager training, work behavior assessments, leadership dialogues and the opportunity to participate in third party conferences and training.
This agreement provides the franchisee the right to c onstruct, own and operate a Wendy’s restaurant upon a site accepted by Wendy’s and to use the Wendy’s system in connection with the operation of the restaurant at that site. The Current Franchise Agreement provides for a 20-year term and a 10-year renewal subject to certain conditions.
This agreement provides the franchisee the right to construct, own and operate a Wendy’s restaurant upon a site accepted by Wendy’s and to use the Wendy’s system in connection with the operation of the restaurant at that site. The Current Franchise Agreement provides for a 20-year term and a 10-year renewal subject to certain conditions.
We also leverage annual processes that support individual performance planning, individual professional development planning and a broad review of talent development throughout the Company. Restaurant team members have the opportunity to take advantage of an online learning curriculum, as well as hands-on training led by crew trainers, managers and field support staff.
We also leverage annual processes that support individual performance planning, individual professional development planning and a broad review of talent development throughout the Company. Restaurant-level employees have the opportunity to take advantage of an online learning curriculum, as well as hands-on training led by crew trainers, managers and field support staff.
Domestic trademarks and service marks have their next required maintenance filings at various times from 2025 to 2035 in order to keep such registrations in force, while international trademarks and service marks have various durations of seven to 15 years. We ndy’s generally intends to maintain and renew its trademarks and service mark registrations in accordance with applicable deadlines.
Domestic trademarks and service marks have their next required maintenance filings at various times from 2026 to 2036 in order to keep such registrations in force, while international trademarks and service marks have various durations of seven to 15 years. We ndy’s generally intends to maintain and renew its trademarks and service mark registrations in accordance with applicable deadlines.
In 2024, Wendy’s made charitable donations to a variety of organizations across the globe, highlighted by our ongoing and significant support of the Dave Thomas Foundation for Adoption, a charitable foundation created by our founder, Dave Thomas, which has been our signature charitable cause for more than 30 years and celebrated its 15,000 th adoption.
In 2025, Wendy’s made charitable donations to a variety of organizations across the globe, highlighted by our ongoing and significant support of the Dave Thomas Foundation for Adoption, a charitable foundation created by our founder, Dave Thomas, which has been our signature charitable cause for more than 30 years and celebrated its 16,000 th adoption.
We measure our effectiveness in these areas using various tools and metrics, including administering an employee engagement survey annually and tracking our employee turnover rates compared to others in the restaurant industry. As of December 29, 2024 , the Company was comprised of approximately 14,500 employees, of which approximately one-third were full-time, and two-thirds were part-time.
We measure our effectiveness in these areas using various tools and metrics, including administering an employee engagement survey annually and tracking our employee turnover rates compared to others in the restaurant industry. As of December 28, 2025 , the Company was comprised of approximately 14,900 employees, of which approximately one-third were full-time, and two-thirds were part-time.
Fiscal Year The Company’s fiscal reporting periods consist of 52 or 53 weeks ending on the Sunday closest to December 31 and are referred to herein as (1) “the year ended December 29, 2024” or “2024,” (2) “the year ended December 31, 2023” or “2023,” and (3) “the year ended January 1, 2023” or “2022,” all of which consisted of 52 weeks.
Fiscal Year The Company’s fiscal reporting periods consist of 52 or 53 weeks ending on the Sunday closest to December 31 and are referred to herein as (1) “the year ended December 28, 2025” or “2025,” (2) “the year ended December 29, 2024” or “2024,” and (3) “the year ended December 31, 2023” or “2023,” all of which consisted of 52 weeks.
Wendy’s competitive position is differentiated by a focus on high quality, craveable food, its made-to-order square hamburgers using fresh beef*, its unique and diverse menu, including chicken sandwiches, freshly-prepared salads and other signature items like chili, baked potatoes, the Frosty ® dessert and the Breakfast Baconator ® , its promotional products, its choice of toppings and condiments and the atmosphere and décor of its restaurants.
Wendy’s competitive position is differentiated by a focus on high quality, craveable food, its made-to-order square hamburgers using fresh beef*, its unique and diverse menu, including chicken sandwiches, chicken tenders and nuggets, salads and other signature items like chili, baked potatoes, the Frosty ® dessert and the Breakfast Baconator ® , it s promotional products, its choice of toppings and condiments and the operations, atmosphere and décor of its restaurants.
The relationship agreement addresses other aspects of the franchisor-franchisee relationship, such as restrictions on operating competing businesses, participation in brand initiatives such as national marketing promotions, technology upgrades, business plans, satisfaction of certain financial covenants, employment of approved operators, confidentiality and restrictions on engaging in certain securities offerings, ownership changes or debt refinancing transactions without Wendy’s prior consent.
The relationship agreement addresses other aspects of the franchisor-franchisee relationship, such as restrictions on operating competing businesses, participation in brand initiatives such as restaurant reimaging, national menu and marketing promotions, customer loyalty program and technology initiatives, business plans, satisfaction of certain financial covenants, employment of approved operators, confidentiality and restrictions on engaging in certain securities offerings, ownership changes or debt refinancing transactions without Wendy’s prior consent.
As of December 29, 2024, the contribution rate for Canadian restaurants was approximately 3% of sales for national advertising and approximately 1% of sales for local and regional advertising, with the exception of Quebec, for which there is no national advertising contribution rate and the local and regional advertising contribution rate is 4% of sales.
As of December 28, 2025, the contribution rate for Canadian restaurants was approximately 3% of sales for national advertising and approximately 1% of sales for local and regional advertising, with the exception of Quebec, for which there is no national advertising contribution rate and the local and regional advertising contribution rate is 4% of sales.
Of the international restaurants, 1,294 were operated by a total of 107 franchisees and 13 were operated by the Company in the United Kingdom (the “U.K.”). The Company’s principal executive offices are located at One Dave Thomas Blvd., Dublin, Ohio 43017, and its telephone number is (614) 764-3100.
Of the international restaurants, 1,417 were operated by a total of 117 franchisees and 11 were operated by the Company in the United Kingdom (the “U.K.”). The Company’s principal executive offices are located at One Dave Thomas Blvd., Dublin, Ohio 43017, and its telephone number is (614) 764-3100.
Year Ended 2024 2023 2022 Restaurant acquisitions — — 1 Restaurant dispositions 3 — 1 Franchise Flips (a) 50 99 79 _______________ (a) Represents franchisee-to-franchisee restaurant transfers for which the Company received advisory fees, which include valuation services and fees for selecting pre-approved buyers.
Year Ended 2025 2024 2023 Restaurant acquisitions 35 — — Restaurant dispositions 5 3 — Franchise Flips (a) 1 50 99 _______________ (a) Represents franchisee-to-franchisee restaurant transfers for which the Company received advisory fees, which include valuation services and fees for selecting pre-approved buyers.
Wendy’s generally retains a right of first refusal in connection with any proposed sale or transfer of franchised restaurants. The table below shows the number of restaurant acquisitions, restaurant dispositions and Franchise Flips completed in each of 2024, 2023 and 2022.
W endy’s generally retains a right of first refusal in connection with any proposed sale or transfer of franchised restaurants. The table below shows the number of restaurant acquisitions, restaurant dispositions and Franchise Flips completed in each of 2025, 2024 and 2023.
The following table sets forth the number of Wendy’s restaurants in operation at the beginning and end of each fiscal year from 2022 to 2024 : 2024 2023 2022 Restaurants open at beginning of period 7,240 7,095 6,949 Restaurants opened during period 276 248 276 Restaurants closed during period (276) (103) (130) Restaurants open at end of period 7,240 7,240 7,095 Restaurant Operations Wendy’s develops, operates and franchises restaurants across the globe.
The following table sets forth the number of Wendy’s restaurants in operation at the beginning and end of each fiscal year from 2023 to 2025 : 2025 2024 2023 Restaurants open at beginning of period 7,240 7,240 7,095 Restaurants opened during period 268 276 248 Restaurants closed during period (111) (276) (103) Restaurants open at end of period 7,397 7,240 7,240 Restaurant Operations Wendy’s develops, operates and franchises restaurants across the globe.
Today, Wendy’s is the second largest quick-service restaurant company in the hamburger sandwich segment in the United States (the “U.S.”) based on traffic and dollar share, and the third largest globally with 7,240 restaurants in the U.S. and 31 foreign countries and U.S. territories as of December 29, 2024.
Today, Wendy’s is the second largest quick-service restaurant company in the hamburger sandwich segment in the United States (the “U.S.”) based on traffic and dollar share, and the third largest globally with 7,397 restaurants in the U.S. and 38 foreign countries and U.S. territories as of December 28, 2025.
Such sourcing fees are remitted by these vendors to QSCC and are the primary means of funding QSCC’s operations. Should QSCC’s sourcing fees exceed its expected needs, QSCC’s board of directors may return some or all of the excess to its members in the form of a patronage dividend. Wendy’s does not sell food or restaurant supplies to its franchisees.
Such sourcing fees are remitted by these vendors to QSCC and are the primary means of funding QSCC’s operations. Should QSCC’s sourcing fees exceed its expected needs, QSCC’s board of directors may return some or all of the excess to its members in the form of a patronage dividend.
Our restaurants, our food and the value and service we provide to our customers are all integral to our long-term success, but ultimately it is our people that help us deliver our brand promise every single day. We continue to invest in our Company employees to ensure we are able to attract, hire and retain great talent throughout our organization.
Our restaurants, our food and the value and service we provide to our customers are all integral to our long-term success, but ultimately it is our people that help us deliver an exceptional customer experience. We continue to invest in our Company employees to ensure we are able to attract, hire and retain great talent throughout our organization.
Supply Chain, Distribution and Purchasing As of December 29, 2024, three independent processors (five total production facilities) supplied all of the fresh beef used by Wendy’s restaurants in the U.S. In addition, five independent processors (seven total production facilities) supplied all of the chicken used by Wendy’s restaurants in the U.S.
Supply Chain, Distribution and Purchasing As of December 28, 2025, three independent processors (five total production facilities) supplied all of the fresh beef used by Wendy’s restaurants in the U.S. In addition, six independent processors (eleven total production facilities) supplied all of the chicken used by Wendy’s restaurants in the U.S.
Restaurant support employees are also eligible to participate in a performance-based annual bonus plan. For our restaurant-level employees, we offer the potential for raises based on individual performance reviews throughout the year. At Wendy’s, we are committed to providing pay equity for all employees, regardless of gender or ethnicity.
For our restaurant-level employees, we offer the potential for raises based on individual performance reviews throughout the year. At Wendy’s, we are committed to providing pay equity for all employees, regardless of gender or ethnicity.
Quality Assurance Wendy’s quality assurance program is designed to verify that the food products supplied to our restaurants are processed in a safe, sanitary environment and in compliance with our food safety and quality standards.
Wendy’s does not sell food or restaurant supplies or products to its franchisees. Quality Assurance Wendy’s quality assurance program is designed to verify that the food products supplied to our restaurants are processed in a safe, sanitary environment and in compliance with our food safety and quality standards.
In addition, Wendy’s restaurants sell a variety of promotional products on a limited time basis. In March 2020, Wendy’s entered the breakfast daypart across the U.S. system and, in May 2022, launched breakfast in Canada. Wendy’s breakfast menu features a variety of breakfast sandwiches such as the Breakfast Baconator ® and sides such as seasoned potatoes.
In addition, Wendy’s restaurants sell a variety of promotional products on a limited time basis. Wendy’s also offers breakfast in the U.S. and Canada. Wendy’s breakfast menu features a variety of breakfast sandwiches such as the Breakfast Baconator ® and sides such as seasoned potatoes.
Non-traditional locations, including delivery kitchens, may be subject to adjusted requirements for national, local and regional advertising contributions. See Note 23 to the Consolidated Financi al Statements contained in Item 8 herein for additional information regarding advertising.
Non-traditional locations, including delivery kitchens, may be subject to adjusted requirements for national, local and regional advertising contributions. See Note 24 to the Consolidated Financi al Statements contained in Item 8 herein for additional information regarding advertising. Human Capital The Wendy’s customer is at the heart of everything we do.
In addition, there w as one main in-line distributor of food, packaging and beverage products, excluding breads, that serviced approximately 67% of Wendy’s restaurants in the U.S. and four additional in-line distributors that, in the aggregate, serviced approximately 32% of Wendy’s restaurants in the U.S.
In ad dition, there was one main in-line distributor of food, packaging and beverage products, excluding breads, that serviced approximately 63% of Wendy’s restaurants in the U.S. and four additional in-line distributors that, in the aggregate, serviced approximately 35% of Wendy’s restaurants in the U.S.
The Company believes that our FDD, together with applicable state versions or supplements, and franchising procedures comply in all material respects with the FTC’s franchise rules and applicable state franchise laws. 14 International Operations Internationally, the Company and our franchisees are subject to national, provincial and local laws and regulations that often are similar to those impacting us and our franchisees in the U.S., including laws and regulations concerning franchises, labor and employment, building and zoning, health, fire and safety, sanitation, food preparation, nutritional content, menu labeling, advertising, information security, privacy and consumer protection.
International Operations Internationally, the Company and our franchisees are subject to national, provincial and local laws and regulations that often are similar to those impacting us and our franchisees in the U.S., including laws and regulations concerning franchises, labor and employment, building and zoning, health, fire and safety, sanitation, food preparation, nutritional content, menu labeling, advertising, information security, privacy and consumer protection.
Compensation and Benefits We are committed to providing market-competitive pay and benefits to attract and retain great talent. We enable this by benchmarking and analyzing pay and benefits both externally and internally. In addition to receiving competitive hourly rates and base salaries, all general managers and district managers of our Company-operated restaurants are eligible for performance-based cash incentive bonuses.
We enable this by benchmarking and analyzing pay and benefits both externally and internally. In addition to receiving competitive hourly rates and base salaries, all general managers and district managers of our Company-operated restaurants are eligible for performance-based cash incentive bonuses. Restaurant support employees are also eligible to participate in a performance-based annual bonus plan.
Wendy’s U.S. includes the operation and franchising of Wendy’s restaurants in the U.S. and derives its revenues from sales at Company-operated restaurants and royalties, franchise fees and national advertising fund collections from franchised restaurants.
Business Segments The Company is comprised of the following segments: (1) Wendy’s U.S., (2) Wendy’s International and (3) Global Real Estate & Development. Wendy’s U.S. includes the operation and franchising of Wendy’s restaurants in the U.S. and derives its revenues from sales at Company-operated restaurants and royalties, franchise fees and national advertising fund collections from franchised restaurants.
In addition to the contributions to the national advertising funds, Wendy’s requires additional contributions to be made for both Company-operated and franchised restaurants based on a percentage of restaurant sales for the purpose of local and regional advertising programs.
In addition to the contributions to the national advertising funds, Wendy’s may require additional contributions to be made to an advertising co-op within an applicable designated market area for both Company-operated and franchised restaurants based on a percentage of restaurant sales for the pu rpose of local and regional advertising programs.
Franchising A s of December 29, 2024, 207 Wendy’s U.S. franchisees operated 5,552 franchised restaurants in 50 states and the District of Columbia, and 107 Wendy’s international franchisees operated 1,294 franchised restaurants in 31 foreign countries and U.S. territories. U.S.
Franchising A s of December 28, 2025, 203 Wendy’s U.S. franchisees operated 5,546 franchised restaurants in 50 states and the District of Columbia, and 117 Wendy’s international franchisees operated 1,417 franchised restaurants in 38 foreign countries and U.S. territories. U.S.
At December 29, 2024, there were 5,933 Wendy’s restaurants in operation in the U.S. Of these restaurants, 381 were operated by the Company and 5,552 were operated by a total of 207 franchisees. In addition, at December 29, 2024, there were 1,307 Wendy’s restaurants in operation in 31 foreign countries and U.S. territories.
At December 28, 2025, there were 5,969 Wendy’s restaurants in operation in the U.S. Of these restaurants, 423 were operated by the Company and 5,546 were operated by a total of 203 franchisees. In addition, at December 28, 2025, there were 1,428 Wendy’s restaurants in operation in 38 foreign countries and U.S. territories.
In addition to corporate contributions, we also hosted an employee-driven Community Giving Program, in which our employees nominated worthy charitable organizations to receive grants from The Wendy’s Foundation. We also made grants available to charitable organizations chosen by our ERGs in support of their missions.
In addition to corporate contributions, we also host an employee-driven Community Giving Program, in which individual employees from across the Wendy’s system and our ERGs nominate worthy charitable organizations to receive grants from The Wendy’s Foundation.
Creating and fostering inclusive work environments allows us to create an engaging and welcoming culture for our employees, which we believe positively affects the quality of products, service and experience we deliver to our customers. We also believe that our Company workforce should be representative of our customer base, in order to best serve them.
Creating and fostering work environments where people feel included and welcomed allows us to create an engaging culture for our employees, which we believe positively affects the quality of products, service and experience we deliver to our customers.
Culture and Inclusion We believe our strategic focus on culture and inclusion has helped and will continue to help the Company remain true to our values as well as support our financial performance and global growth strategy.
We expect our employees to maintain respectful workplaces that support and protect the integrity of the Wendy’s brand and fuel our continued success. 12 People-Centered Culture We believe our strategic focus on continually building a culture centered on people has helped and will continue to help the Company remain true to our values as well as support our financial performance and global growth strategy.
Our properties are sometimes located in developed commercial or industrial areas and might previously have been occupied by more environmentally significant operations, such as gas stations. Environmental laws and regulations sometimes require owners or operators of contaminated property to remediate that property, regardless of fault, and could give rise to significant fines, penalties and liabilities, as well as third-party claims.
Our properties are sometimes located in developed commercial or industrial areas and might previously have been occupied by more environmentally significant operations, such as gas stations.
We have seven ERGs which focus on Women (Women of Wendy’s), LGBTQ+ (WeQual), Military Veterans & Families (WeVets), Culturally Diverse (WCD), Black (WeBERG), Young Professionals (WenGEN) and Care Givers (GiveCare). All employees are welcome in our ERGs. In 2024, we hosted over 100 wide-ranging programs facilitated by our ERGs.
Our ERGs support Women (Women of Wendy’s), LGBTQ+ (WeQual), Military Veterans & Families (WeVets), Culturally Diverse (WCD), Black (WeBERG), Young Professionals (WenGEN) and Care Givers (GiveCare). All employees are welcome in our ERGs. Compensation and Benefits We are committed to providing market-competitive pay and benefits to attract and retain great talent.
To promote new restaurant development, Wendy’s has provided franchisees with certain incentive programs for qualifying new and existing restaurants .
To promote new restaurant development, Wendy’s has provided franchisees with certain incentive programs for qualifying new and existing restaurants . In the U.S. and Canada, Wendy’s offers incentives to new and existing franchisees who enter into development agreements to build new restaurants on a mutually agreed schedule.
The Company believes that our restaurant operations comply substantially with all applicable environmental laws and regulations. Increased focus by governmental authorities on environmental matters have led and will likely lead to additional new governmental initiatives, particularly in the area of climate change.
Increased focus by governmental authorities on environmental matters have led and will likely lead to additional new governmental initiatives, particularly in the area of climate change. While we cannot predict the precise nature of these initiatives, we expect that they may impact our business both directly and indirectly.
While the Company has no plans to move its ownership away from approximatel y 5% of the Wendy’s system, it expects to continue to optimize the Wendy’s system by facilitating Franchise Flips, as well as evaluating strategic acquisitions of franchised restaurants and strategic dispositions of Company-operated restaurants to existing and new franchisees, to further strengthen the franchisee base and drive new restaurant development.
System Optimization The Company optimizes the Wendy’s system by facilitating Franchise Flips, evaluating strategic acquisitions of franchised restaurants and strategic dispositions of Company-operated restaurants to existing and new franchisees and, at times, closing certain underperforming restaurants, to further strengthen the franchisee base, support franchisee economics and drive new restaurant development.
As of December 29, 2024, the contribution rate for U.S. restaurants was generally 3.5% of sales for national advertising and 0.5% of sales for local and regional advertising.
As of December 28, 2025, the contribution rate for U.S. restaurants was generally 3.5% of sales for national advertising and 0.5% of sales for local and regional advertising. Wendy’s may, at times, require that local and regional advertising funds be re-purposed to national advertising, in agreement with a system vote.
We are proud to have a workforce with diverse backgrounds and experiences. 12 Respectful Workplace From day one, the Wendy’s business has always been of, for and about people. More than 50 years ago, our founder, Dave Thomas, established this Company based on certain core values, including Doing the Right Thing, Treating People with Respect and Giving Something Back.
We are proud to have a workforce with diverse backgrounds and experiences. Respectful Workplace From day one, the Wendy’s business has always been of, for and about people. Respect and fair treatment for our employees, franchisees, suppliers, business partners and customers are a central part of our business.
See “The Wendy’s Restaurant System—Quality Assurance” above for additional information. See Note 2 and Note 20 to the Consolidated Financial Statements contained in Item 8 herein, and the information under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” herein, for information regarding certain guarantee obligations, reserves, commitments and contingencies involving franchisees.
From time to time, Wendy’s may modify these standards to 11 address strategic operating initiatives, consumer preferences, market demand and/or availability of capital. See “The Wendy’s Restaurant System—Quality Assurance” above for additional information. See Note 2 and Note 21 to the Consolidated Financial Statements contained in Item 8 herein, and the information under “Item 7.
Company-operated restaurants comprised approximatel y 5% of the total Wendy’s system as of December 29, 2024 . Restaurant Openings and Closings During 2024, Wendy’s opened 276 new restaurants, of which three were Company-operated and 273 were franchisee-operated. During 2024, Wendy’s closed 276 generally underperforming restaurants, of which 21 were Company-operated and 255 were franchisee-operated.
Restaurant Openings and Closings During 2025, Wendy’s opened 268 new restaurants, of which 15 were Company-operated and 253 were franchisee-operated. During 2025, Wendy’s closed 111 generally underperforming restaurants, of which five were Company-operated and 106 were franchisee-operated.
Over the years, these values have remained central to our business and inform our approach with our employees, franchisees, suppliers, business partners, customers and the communities we serve.
We strive to bring our values to life through daily interactions with our employees, franchisees and customers in the communities where we do business.
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Business Strategy Wendy’s strategic framework includes providing fresh, famous food to consumers, delivering an exceptional customer experience through operational excellence and expanding the Company’s footprint across the globe.
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Business Strategy During 2025, the Company announced Project Fresh , a comprehensive plan to drive profitable growth and long-term value across our U.S. system. The four strategic pillars of Project Fresh include (1) brand revitalization, (2) operational excellence, (3) system optimization and (4) capital allocation.
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Our opportunities to execute on this framework for long-term profitable growth include (1) driving same-restaurant sales and share growth, (2) accelerating digital growth, (3) improving restaurant profitability and (4) driving global unit growth. Business Segments The Company is comprised of the following segments: (1) Wendy’s U.S., (2) Wendy’s International and (3) Global Real Estate & Development.
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These pillars are designed to drive profitable average unit volume growth and increase traffic in the U.S. by improving marketing effectiveness, menu offerings and the customer experience, and to enhance franchisee economics. Internationally, the Company’s strategic priorities also include driving profitable average unit volume growth and sustaining strong net unit growth.
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System Optimization The Company’s system optimization initiative included a shift from Company-operated restaurants to franchised restaurants over time, through acquisitions and dispositions, as well as by facilitating Franchise Flips. As of December 29, 2024, Company-operated restaurant ownership was approximately 5% of the total system.
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These incentives typically include reduced royalty and national advertising fees and may include full or partial waivers of the upfront technical assistance fee for each restaurant opened.
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In July and September 2024, Wendy’s announced a new development incentive structure in the U.S. and Canada and select international markets, respectively, that provides for reductions in royalty and national advertising fees for qualifying new restaurants for two, three or four years of operation based on the number of restaurants committed to under a development agreement .
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Similarly, in markets outside the U.S. and Canada, Wendy’s provides incentives for qualifying restaurants under new franchise or license agreements, generally in the form of reduced royalty fees and full or partial waivers of the technical assistance fee.
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Franchisees who open a restaurant on or before November 30th of the calendar year prior to the restaurant’s required open date receive a technical assistance fee waiver. Wendy’s also provides franchisees with its base-level incentive that provides for reductions in royalty and national advertising fees for up to the first two years of operation for qualifying approved replacement restaurants.
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Existing franchisees in these markets may also receive comparable incentives when they amend their franchise agreement or enter into a development agreement to commit to building new restaurants on an agreed schedule.
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From time to time, Wendy’s may modify these incentive programs. For example, subsequent to December 29, 2024 , Wendy’s announced that it is offering the highest-level incentive, which provides for fee reductions for four years, to all new and existing U.S. franchisees for a limited period of time under certain circumstances.
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So is staying true to the values established by our founder, Dave Thomas, more than 55 years ago, which include Doing the Right Thing, Treating People with Respect and Giving Something Back.
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Human Capital We are focused on continuing to build love for Wendy’s by delivering on our brand promise – “Fresh Famous Food…Made Right…For You” – every time in every restaurant, for every customer, every day.
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The Company believes that our FDD, together with applicable state versions or supplements, and franchising procedures comply in all material respects with the FTC’s franchise rules and applicable state franchise laws.
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Our brand promise is foundational to our culture, and it is delivered by inspiring our employees and restaurant teams to always put the customer first, make every restaurant the star, operate the one best way and own the responsibility to grow the Wendy’s brand.
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Environmental laws and 14 regulations sometimes require owners or operators of contaminated property to remediate that property, regardless of fault, and could give rise to significant fines, penalties and liabilities, as well as third-party claims. The Company believes that our restaurant operations comply substantially with all applicable environmental laws and regulations.
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We strive to bring our values to life every day, and we share and reinforce our values and expectations with our employees through other policies and procedures. We value and promote respectful and inclusive workplaces as we believe healthy and thriving workplaces are key to supporting and protecting the integrity of the Wendy’s brand and fuel our continued success.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeMoreover, because franchisees contribute to advertising funds based on a percentage of sales at their franchised restaurants, our advertising fund expenditures are dependent upon sales volumes across the Wendy’s system. If systemwide sales decline, this could result in a reduced amount of funds available for our marketing and advertising programs.
Biggest changeFor example, because of the wide range of our customers and channels of communication used by them, our marketing and advertising may not always reach consumers as intended. Moreover, because franchisees contribute to advertising funds based on a percentage of sales at their franchised restaurants, our advertising fund expenditures are dependent upon sales volumes across the Wendy’s system.
Some countries’ laws make unregistered trademarks more difficult to enforce, or do not protect them at all, and third parties have filed, or may in the future file, for “Wendy’s” or similar marks.
Some countries’ laws make unregistered trademarks more difficult to enforce, or do not protect them at all, and third parties have filed, and may in the future file, for “Wendy’s” or similar marks.
Cybersecurity incidents or breaches have, from time to time, occurred and may in the future occur involving our systems, the systems of our franchisees or the systems of third-party service providers.
Cybersecurity incidents or breaches have, from time to time, occurred and may in the future occur involving our systems, the systems of our franchisees or the systems of our third-party service providers.
Pursuant to the Trian Agreement, our Board of Directors, including a majority of the independent directors, approved, for purposes of Section 203 of the Delaware General Corporation Law, the Covered Persons becoming the owners (as defined in Section 203(c)(9)) of or acquiring an aggregate of up to (and including), but not more than, 32.5% (subject to certain adjustments set forth in the Trian Agreement) of the outstanding shares of the Company’s common stock, such that no such persons would be subject to the restrictions set forth in Section 203 solely as a result of such ownership.
Pursuant to the Trian Agreement, our Board, including a majority of the independent directors, approved, for purposes of Section 203 of the Delaware General Corporation Law, the Covered Persons becoming the owners (as defined in Section 203(c)(9)) of or acquiring an aggregate of up to (and including), but not more than, 32.5% (subject to certain adjustments set forth in the Trian Agreement) of the outstanding shares of the Company’s common stock, such that no such persons would be subject to the restrictions set forth in Section 203 solely as a result of such ownership.
Each Wendy’s restaurant is subject to licensing and regulation by health, sanitation, safety and other agencies in the state or municipality in which the restaurant is located, as well as to federal laws, rules and regulations and requirements of non-governmental entities such as payment card industry rules.
Each Wendy’s restaurant is subject to licensing and regulation by health, sanitation, safety and other agencies in the state and/or municipality in which the restaurant is located, as well as to federal laws, rules and regulations and requirements of non-governmental entities such as payment card industry rules.
In the United States, this includes laws like the Fair Labor Standards Act, which governs such matters as minimum wages, overtime and other working conditions, Title VII, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the National Labor Relations Act, family leave, paid sick time and similar requirements and a variety of other laws, regulations and rules.
In the United States, this includes laws like the Fair Labor Standards Act, which governs such matters as minimum wages, overtime and other working conditions, Title VII, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the National Labor Relations Act, family leave, paid sick time and similar requirements and a variety of other laws, rules and regulations.
We are also subject to legal and compliance risks related to privacy and data collection, protection and management of certain data and information associated with our technology-related services and platforms made available to customers, employees, franchisees, business partners or other third parties.
We are also subject to legal and compliance risks related to privacy and data collection, and protection and management of certain data and information associated with our technology-related services and platforms made available to customers, employees, franchisees, business partners or other third parties.
The Senior Notes are secured by a security interest in substantially all of the assets of the Master Issuer and certain other limited-purpose, bankruptcy-remote, wholly-owned indirect subsidiaries of the Company that act as guarantors (collectively, the “Securitization Entities”), except for certain real estate assets and subject to certain limitations as set forth in the indenture governing the Senior Notes (the “Indenture”) and the related guarantee and collateral agreement.
The Senior Notes are secured by a security interest in substantially all of the assets of the Master Issuer and certain other limited-purpose, bankruptcy-remote, wholly-owned indirect subsidiaries of the Company that act as guarantors (collectively, the “Securitization Entities”), except for certain real estate assets and subject to certain 25 limitations as set forth in the indenture governing the Senior Notes (the “Indenture”) and the related guarantee and collateral agreement.
The dissemination of information by news media, customers, employees, social media influencers and others via social or digital media, whether accurate or inaccurate, could harm our business, brand, reputation, results of operation and financial condition. This damage may be immediate, without an opportunity to correct inaccurate information or respond to or address particular issues.
The dissemination of information by news media, customers, employees, social media influencers, spokespersons and others via social or digital media, whether accurate or inaccurate, could harm our business, brand, reputation, results of operation and financial condition. This damage may be immediate, without an opportunity to correct inaccurate information or respond to or address particular issues.
Any report linking our restaurants or suppliers to food-borne illnesses, food tampering, contamination or mislabeling or other food-safety issues could damage the value of our brand immediately and severely hurt sales of our products and possibly lead to product liability claims, litigation (including class actions) or other damages.
Any report linking our restaurants or suppliers to food-borne illnesses, food tampering, contamination or mislabeling or other food-safety issues could damage the value of our brand immediately and severely hurt sales of our products and possibly lead to regulatory claims, product liability claims, litigation (including class actions) or other damages.
As a result of these restrictions, the Company may not have adequate resources or flexibility to continue to manage the business and provide for growth of the Wendy’s system, which could have a material adverse effect on the Company’s future growth prospects, results of operations, financial condition and liquidity.
As a result of these restrictions, the Company may not have adequate resources or flexibility to continue to manage the business and provide for growth of the Wendy’s system, which could have a material adverse effect on the Company’s prospects, results of operations, financial condition and liquidity.
The Company may incur additional indebtedness, guarantees, commitments or other liabilities in the future that could amplify the risks that the Company currently faces. 25 Risks Related to Our Common Stock There can be no assurance regarding whether or to what extent we will pay dividends on our common stock in the future.
The Company may incur additional indebtedness, guarantees, commitments or other liabilities in the future that could amplify the risks that the Company currently faces. Risks Related to Our Common Stock There can be no assurance regarding whether or to what extent we will pay dividends on our common stock in the future.
The growth of our business is dependent on new restaurant openings, which could be affected by factors beyond our control. Our business derives earnings from sales at Company-operated restaurants as well as royalties and other fees received from franchised restaurants. Growth in our revenues and earnings is dependent on new restaurant openings.
The growth of our business is dependent, in part, on new restaurant openings, which could be affected by factors beyond our control. Our business derives earnings from sales at Company-operated restaurants as well as royalties and other fees received from franchised restaurants. Growth in our revenues and earnings is dependent, in part, on new restaurant openings.
Changes in laws, regulations, rules and governmental policies, including the interpretation thereof, could increase our costs, require modifications to our business practices, result in increased litigation, investigations, enforcement actions, fines or liabilities and adversely affect our business, results of operations and financial condition.
Changes in laws, rules, regulations, and governmental policies, including the interpretation thereof, could increase our costs, require modifications to our business, result in increased litigation, investigations, enforcement actions, fines or liabilities and adversely affect our business, results of operations and financial condition.
We are subject to various laws and regulations that govern the offer and sale of a franchise, including rules by the U.S. Federal Trade Commission. Various state, provincial and foreign laws regulate certain aspects of the franchise relationship, including terminations and the refusal to renew franchises.
We are subject to various laws, rules and regulations that govern the offer and sale of a franchise, including rules by the U.S. Federal Trade Commission. Various state, provincial and foreign laws, rules and regulations also regulate certain aspects of the franchise relationship, including terminations and the refusal to renew franchises.
We could also face lawsuits by franchisees based upon alleged violations of these laws. We and our franchisees are each also subject to laws and regulations that govern employment matters at the federal/national, state/provincial and local levels.
We could also face lawsuits by franchisees based upon alleged violations of these laws, rules and regulations. We and our franchisees are each also subject to laws, rules and regulations that govern employment matters at the federal/national, state/provincial and local levels.
The success of this initiative is dependent upon many factors, such as the availability of sellers and buyers, the availability of financing, the ability to negotiate transactions on terms deemed acceptable and the ability to successfully transition and integrate restaurant operations.
The success of this initiative is dependent upon many factors, such as the availability of sellers and buyers, the availability of financing, the ability to negotiate and consummate transactions on terms deemed acceptable and the ability to successfully transition and integrate restaurant operations.
Furthermore, an insolvency or bankruptcy proceeding involving a franchisee could prevent or delay us from collecting payments or exercising any of our other rights under the franchise or other related agreement with such franchisee.
Furthermore, an insolvency event or bankruptcy proceeding involving a franchisee could prevent or delay us from collecting payments or exercising any of our other rights under the franchise or other related agreement with such franchisee.
Our success also depends to a large extent on continued consumer acceptance of, and demand for, our offerings, the success of 16 our operating, growth, promotional, marketing and new product development initiatives and the reputation of our brand.
Our success also depends to a large extent on continued consumer acceptance of, and demand for, our offerings, the success of our operating, growth, promotional, marketing and new product development initiatives and the reputation of our brand.
The Wendy’s system may also be adversely impacted by consumer or regulatory concerns regarding the nutritional aspects of the products we sell, the ingredients in our products or the cooking processes or packaging used in our restaurants.
The Wendy’s system may also be adversely impacted by consumer or regulatory concerns or litigation regarding the nutritional aspects of the products we sell, the ingredients in our products or the cooking processes or packaging used in our restaurants.
We wish to caution readers that in addition to the important factors described elsewhere in this Form 10-K, we have included below certain material factors that have affected, or in the future could affect, our actual results and could cause our actual consolidated results during fiscal 2025, and beyond, to differ materially from those expressed in or implied by any forward-looking statements made by us or on our behalf.
We wish to caution readers that in addition to the important factors described elsewhere in this Form 10-K, we have included below certain material factors that have affected, or in the future could affect, our actual results and could cause our actual consolidated results during fiscal 2026, and beyond, to differ materially from those expressed in or implied by any forward-looking statements made by us or on our behalf.
In addition, our competitors, some of whom have greater resources than we do, may be better able to benefit from changes in technologies or consumer acceptance of such changes, which could harm our competitive position and brand. An increasing amount of our sales and revenues is derived from digital orders, including online ordering and delivery.
In addition, our competitors, some of whom have greater resources than we do, may be better able to benefit from changes in technologies or consumer, employee or franchisee acceptance of such changes, which could harm our competitive position and brand. An increasing amount of our sales and revenues is derived from digital orders, including online ordering and delivery.
Our results of operations and the value and perception of our brand are heavily influenced by brand marketing and advertising and by our ability to develop and launch new and innovative products.
Our results of operations and the value and perception of our brand are heavily influenced by the effectiveness of our brand marketing and advertising and by our ability to develop and launch new and innovative products.
The ongoing and long-term costs of these impacts could have a material adverse effect on our business if not properly mitigated.
The ongoing and 22 long-term costs of these impacts could have a material adverse effect on our business if not properly mitigated.
We are heavily dependent on our computer systems and information technology, including those controlled by third-party providers, to conduct our business, including point-of-sale processing in our restaurants, technologies that support our digital and delivery solutions, management of our supply chain, collection of cash, payment of obligations and various other processes and procedures.
We and our franchisees are heavily dependent on our computer systems and information technology, including those controlled by third-party providers, to conduct our business, including point-of-sale processing in our restaurants, technologies 24 that support our digital and delivery solutions, management of our supply chain, collection of cash, payment of obligations and various other processes and procedures.
A cyber incident could also require us to notify customers, employees or other groups, result in adverse publicity or a loss in consumer confidence, sales and profits, increase fees payable to third parties or cause us to incur penalties or remediation and other costs that could adversely affect our business, results of operations and financial condition.
A cybersecurity incident could also require us to notify customers, employees or other groups, result in adverse publicity or a loss in consumer confidence, sales and profits, increase fees payable to third parties or cause us to incur penalties or remediation and other costs that could adversely affect our business, results of operations and financial condition.
Our business involves the collection and retention of sensitive customer data, including, in some instances, credit and debit card numbers and other personally identifiable information, in various information systems that we and our franchisees maintain and in those maintained by third parties with whom we and our franchisees contract to provide credit card processing, digital ordering and related services.
Our business involves the processing of sensitive customer data, including, in some instances, credit and debit card numbers and other personally identifiable information, in various information systems that we and our franchisees maintain and in those maintained by third parties with whom we and our franchisees contract to provide credit card processing, digital ordering and related services.
Our system optimization initiative also places demands on our operational and financial management resources and may require us to expand these resources. If we are unable to execute our system optimization initiative or effectively manage the acquisition and disposition of restaurants, our business and financial results could be adversely affected.
Our system optimization initiative also places demands on our operational and financial management resources and may require us to expand these resources. If we are unable to execute our system optimization initiative or effectively manage the acquisition and disposition of restaurants, our business and financial results and the health of our franchise system could be adversely affected.
Changes in discretionary consumer spending, and in consumer tastes and preferences, could adversely affect our business, results of operations and financial condition. The success of the Wendy’s system depends to a significant extent on discretionary consumer spending, which is influenced by general economic conditions and the availability of discretionary income.
Changes in discretionary consumer spending, and in consumer tastes and preferences, could adversely affect our business, results of operations and financial condition. The success of the Wendy’s system depends to a significant extent on discretionary consumer spending, which is influenced by general economic conditions, consumers’ perceptions of general economic conditions and the availability of discretionary income.
Our marketing and advertising programs may not be successful, or we may fail to develop commercially successful new products, which may impact our ability to attract new customers and retain existing customers, which, in turn, could materially and adversely affect our results of operations and the value and perception of our brand.
Our marketing and advertising programs, including brand partnerships, may not be successful, or we may fail to develop commercially successful new products, which may impact our ability to attract new customers and retain existing customers, which, in turn, could materially and adversely affect our results of operations and the value and perception of our brand.
Our inability or failure to recognize, respond to and effectively manage the impact of social or digital media could adversely impact our brand, business and results of operations. Social media platforms, including forms of internet-based communications, allow individuals access to a broad audience.
Our inability or failure to recognize, respond to and effectively manage the impact of social or digital media could adversely impact our brand, business, results of operations and financial condition. Social media platforms, including forms of internet-based communications, allow individuals access to a broad audience.
If franchisees are unable to obtain financing at commercially reasonable rates, or at all, they may be unwilling or unable to invest in their existing restaurants or the development of new restaurants, and our future growth and results of operations could be adversely affected.
If franchisees are unable to obtain financing at commercially reasonable rates, or at all, they may be unwilling or unable to invest in their existing restaurants or new restaurant development, and our future growth and results of operations could be adversely affected.
Risks Related to Technology and Cybersecurity There are risks and uncertainties associated with our digital commerce strategies, platforms and technologies. Advances in technologies, including advances in digital food ordering and delivery technologies, and changes in consumer behavior driven by such advances could have a negative effect on our business.
Risks Related to Technology and Cybersecurity There are risks and uncertainties associated with our digital commerce strategies, platforms and technologies. Advances in technologies, including digital and delivery technologies, and changes in consumer behavior driven by such advances could have a negative effect on our business.
Regardless of whether any claims against us are valid or whether we are found to be liable, claims may be expensive to defend and may divert 26 management’s attention away from operations, hurt our performance and have a negative impact on our brand.
Regardless of whether any claims against us are valid or whether we are found to be liable, claims may be expensive to defend and may divert management’s attention away from operations, hurt our performance and have a negative impact on our brand and our restaurants.
The Senior Notes are also subject to customary rapid amortization events provided for in the Indenture, including events tied to failure to maintain stated debt service coverage ratios, the sum of global gross sales for specified restaurants being below certain levels on certain measurement dates, certain manager termination events, the occurrence of an event of default and the failure to repay or refinance on the applicable scheduled maturity date.
The Senior Notes are also subject to customary rapid amortization events provided for in the Indenture, including events tied to failure to maintain stated debt service coverage ratios, the sum of global gross sales for specified restaurants being below certain levels on certain measurement dates, certain manager termination events, the occurrence of an event of default and the failure to repay or refinance the Senior Notes on the applicable scheduled payment dates.
Additionally, many of our competitors have introduced lower cost value meal menu options and have employed marketing strategies that include frequent use of price discounting (including through the use of coupons and other offers), frequent promotions and heavy advertising expenditures.
Additionally, many of our competitors have introduced lower cost value meal menu options and have employed marketing strategies that include frequent use of price discounting (including through the use of coupons and other offers), frequent promotions and significant advertising expenditures.
Material declines in the amount of discretionary spending or consumer food-away-from-home spending, or significant increases in expenses incurred by consumers, such as living expenses or gasoline prices, could hurt our business, results of operations and financial condition.
Declines in the amount of discretionary spending or consumer food-away-from-home spending, or increases in expenses incurred by consumers, such as living expenses or gasoline prices, could hurt our business, results of operations and financial condition.
Applicable insurance policies contain customary limitations, conditions and exclusions, and there can be no assurance that our cyber or other insurance policies will cover substantially all of the costs and expenses related to any previous or future incidents.
Applicable insurance policies contain customary limitations, conditions and exclusions, and there can be no assurance that our cybersecurity or other insurance policies will cover substantially all of the costs and expenses related to any previous or future incidents.
However, we may be unable to deliver global sales growth or maintain or grow market share across our dayparts due to competitive pressures and other factors, such as consumer tastes and preferences, the effectiveness of our marketing and advertising programs, the successful development and launch of new products, commodity and labor costs, providing fast and accurate customer experiences, further accelerating our digital business and technological enhancements, driving new restaurant development and ensuring the support and engagement of franchisees.
However, we may be unable to deliver average unit volume or sales growth or maintain or grow market share across our dayparts due to competitive pressures and other factors, such as consumer tastes and preferences, the effectiveness of our marketing and advertising programs, the successful development and launch of new products, commodity and labor costs, providing fast and accurate customer experiences, further accelerating our digital business and technological enhancements, driving new restaurant development and ensuring the support and engagement of franchisees.
The failure to comply with these laws and regulations in any jurisdiction or to obtain required government approvals could result in a ban or temporary suspension on future franchise sales, fines and penalties or require us to make offers of rescission or restitution, any of which could adversely affect our business and results of operations.
The failure to comply with these laws, rules and regulations in any jurisdiction or to obtain required government approvals could result in a ban or temporary suspension on future franchise sales, fines and penalties or require us to make offers of rescission or restitution, any of which could adversely affect our business results of operations and financial condition.
For example, our brand could be damaged by claims or perceptions about the quality or safety of our products or the quality or reputation of our employees, franchisees or other business partners, regardless of whether such claims or perceptions are true.
For example, our brand could be damaged by claims or perceptions about the quality, value or safety of our products or the quality, reputation or actions of our employees, franchisees or other business partners, regardless of whether such claims or perceptions are true.
If we do not attempt or are unable to successfully protect, maintain or enforce our intellectual property rights, there could be a material adverse effect on our business or results of operations as a result of, among other things, consumer confusion, dilution of the Wendy’s brand or increased competition from unauthorized users of our brand.
If we are unable to successfully protect, maintain or enforce our intellectual property rights, there could be a material adverse effect on our business or results of operations as a result of, among other things, consumer confusion, dilution of the Wendy’s brand or increased competition from unauthorized users of our brand.
Not all of the trademarks or domain names that are used in the Wendy’s system have been registered in all of the countries in which we do business or may do business in the future, and some trademarks will never be registered in all of these countries.
Not all of the trademarks that are used in the Wendy’s system have been registered in all of the countries in which we do business or may do business in the future, and some trademarks will never be registered in all of these countries.
If our security and information systems are compromised or if our employees or franchisees fail to comply with, or fail to successfully implement processes related to, these laws, regulations or contract terms, and this information is obtained by unauthorized persons or used inappropriately, it could adversely affect our reputation, disrupt our operations, damage our relationship with customers, franchisees or employees and result in costly litigation, judgments, or penalties resulting from violation of applicable laws and payment card industry regulations.
If our security and information systems are compromised or if our employees or franchisees, or third-party service providers fail to comply with, or fail to successfully implement processes related to, these laws, regulations or contract terms, and this information is obtained by unauthorized persons or used inappropriately, it could adversely affect our reputation, disrupt our operations, damage our relationship with customers, franchisees or employees and result in costly litigation, judgments, or penalties resulting from violation of applicable laws and payment card industry regulations.
A significant decrease in real estate values or increase in real estate costs could adversely affect our results of operations and financial condition. We are subject to federal, state and local environmental, health and safety laws and regulations concerning the discharge, storage, handling, release and disposal of hazardous or toxic substances.
A significant decrease in real estate values or increase in real estate costs could adversely affect our business and financial condition. We are subject to federal, state and local environmental, health and safety laws and regulations concerning the discharge, storage, handling, release and disposal of hazardous or toxic substances.
If the quick-service restaurant hamburger segment contracts or does not grow as quickly as other categories within the food service industry, or if we are unable to continue to achieve consumer acceptance or adapt to changes in consumer demographics or preferences, including with respect to product mix, nutrition, health or dietary trends (including the use of weight loss medications), environmental or social concerns or the use of digital channels, Wendy’s restaurants may lose customers, and the resulting revenues from Company-operated restaurants and the royalties that we receive from franchisees may decline.
If the quick-service restaurant hamburger segment contracts or does not grow as quickly as other categories within the food service industry, or if we are unable to continue to achieve consumer acceptance or adapt to changes in consumer demographics or preferences, including with respect to product mix, pricing, nutrition, health or dietary trends (including the use of weight loss medications), corporate responsibility concerns or the use of digital channels, Wendy’s restaurants may lose customers, and the resulting revenues from Company-operated restaurants and the royalties that we receive from franchisees may decline.
We have devoted considerable resources to secure our systems and technology against security breaches and have implemented various processes, procedures and controls to help mitigate the risk of a cyber incident.
We have devoted considerable resources to secure our systems and technology against security breaches and have implemented various processes, procedures and controls to help mitigate the risk of a cybersecurity incident.
Risks Related to Our Indebtedness The Company and certain of our subsidiaries are subject to various restrictions, and substantially all of the assets of certain subsidiaries are security, under the terms of a securitized financing facility.
Risks Related to Our Indebtedness The Company and certain of our subsidiaries are subject to various restrictions, and substantially all of the assets of certain subsidiaries are pledged as security, under the terms of a securitized financing facility.
Acquisitions of franchised restaurants pose various risks to our operations, including (i) diversion of management’s attention to the integration of acquired restaurant operations; (ii) increased operating expenses and the inability to achieve expected cost savings and operating efficiencies; and (iii) the assumption of long-term, non-cancelable leases.
Acquisitions of franchised restaurants pose various risks to our operations, including (i) diversion of management’s attention away from day-to-day operations to the integration of acquired restaurant operations; (ii) increased operating expenses and the inability to achieve expected cost savings and operating efficiencies; and (iii) the assumption of long-term, non-cancelable leases.
Additionally, a subsidiary of the Company has issued variable funding notes, which allows for the borrowing of up to $300.0 million from time to time on a revolving basis.
Additionally, a subsidiary of the Company has issued variable funding notes, which allow for the borrowing of up to $300.0 million from time to time on a revolving basis.
We are subject to a variety of U.S. federal and state and foreign laws and regulations in this area. These laws and regulations have been subject to frequent change, and there may be jurisdictions that propose or enact new data privacy requirements in the future.
We are subject to a variety of federal and state and foreign laws, rules and regulations in this area. These laws and regulations have been subject to frequent change, and there may be jurisdictions that propose or enact new data privacy requirements in the future.
In addition, to the extent we use value offerings or other promotions or discounts in our marketing and advertising programs to drive customer counts, these actions may condition our customers to resist higher menu prices or result in reduced demand for premium products.
In addition, to the extent we use value offerings or other promotions or discounts in our marketing and advertising programs to drive traffic, these actions may condition our customers to resist higher menu prices or result in reduced demand for premium products.
In addition, changes to our leadership and organizational structure, including changes to the Company’s senior leadership team in 2024, can be inherently difficult to manage, and if we are unable to implement such changes effectively, our business, results of operations and financial results could be adversely affected.
In addition, changes to our leadership and organizational structure, including changes to the Company’s senior leadership team in recent years, can be inherently difficult to manage, and if we are unable to implement such changes effectively, our business, results of operations and financial results could be adversely affected.
We are subject to income and other taxes in the United States and foreign jurisdictions, and our operations, plans and results are affected by tax matters and initiatives around the world. In particular, we are affected by the impact of changes to tax rates, laws or policies or related authoritative interpretations.
We are subject to income and other taxes in the United States and foreign jurisdictions, and our operations, plans and results are affected by tax matters and initiatives around the world. In particular, we are impacted by changes to tax rates, laws or policies or related authoritative interpretations.
Our inability to predict consumer acceptance of new technology or our failure to adequately invest in and implement new technology or adapt to technological developments, industry trends and evolving legal and regulatory requirements could result in a loss of customers and related market share.
Our inability to predict consumer, employee or franchisee acceptance of new technology or our failure to adequately invest in and implement new technology or adapt to technological developments, industry trends and evolving ethical, legal and regulatory requirements could result in a loss of customers and related market share.
We also maintain important internal data, such as personally identifiable information about our employees and franchisees and information relating to our operations. Our use and retention of personally identifiable information is regulated by international, federal and state laws, as well as by certain third-party agreements.
We also maintain important internal data, such as personally identifiable information about our employees and franchisees and information relating to our operations. Our processing of personally identifiable information is regulated by international, federal and state laws, as well as by certain third-party agreements.
Our brand could also be adversely impacted by other incidents described in this risk factors section, including incidents related to customer service, health or safety, a failure to attract and retain qualified employees, food safety or other health concerns regarding our products, the impact of social media, digital engagement, our use of emerging technologies, data privacy violations, cyber incidents, environmental, social and governance matters or reports of our employees, franchisees or business partners taking controversial positions or acting in an unethical, illegal or socially irresponsible manner.
Our brand could also be adversely impacted by other incidents described in this risk factors section, including incidents related to customer service, health or safety, a failure to attract and retain qualified employees, food safety or other health concerns regarding our products, the impact of social media, digital engagement, our use of emerging technologies, data privacy violations, cybersecurity incidents, corporate responsibility matters or reports of our employees, franchisees or business partners taking controversial positions or acting in an unethical, illegal or socially irresponsible manner.
While we try to ensure that the quality of our brand is maintained by our franchisees, we cannot ensure that franchisees will not take actions that hurt the value of our intellectual property or the reputation of the Wendy’s brand or restaurant system.
While we try to ensure that the quality of our brand is maintained by our franchisees, we cannot ensure that franchisees and other licensees of our intellectual property will not take actions that hurt the value of our intellectual property or the reputation of the Wendy’s brand or restaurant system.
Our certificate of incorporation prohibits the issuance of preferred stock to affiliates, unless offered ratably to the holders of our common stock, subject to an exception in the event that the Company is in financial distress and the issuance is approved by the Audit Committee of our Board of Directors. This prohibition limits our ability to raise capital from affiliates.
Our certificate of incorporation prohibits the issuance of preferred stock to affiliates, unless offered ratably to the holders of our common stock, subject to an exception in the event that the Company is in financial 27 distress and the issuance is approved by the Audit Committee of our Board of Directors, which limits our ability to raise capital from affiliates.
This negative publicity may reduce demand for Wendy’s food and could result in a decrease in customer counts to Wendy’s restaurants as consumers shift their preferences to our competitors or to other products or food types.
This negative publicity may reduce demand for Wendy’s food and could result in a decrease in traffic to Wendy’s restaurants as consumers shift their preferences to our competitors or to other products or food types.
Additionally, evolving laws and regulations could require us and our franchisees to change or limit the way we 27 collect or use information in operating our business, which may result in additional costs, limit our marketing or growth strategies and adversely affect our business and results of operations.
Additionally, evolving laws, rules and regulations could require us and our franchisees to change or limit the way we collect or use information in operating our business, which may result in additional costs, limit our marketing or growth strategies and adversely affect our business, results of operations and financial condition.
While we employ environmental review standards and practices in the current development of our real estate, we have not conducted a comprehensive environmental review of all of our properties and we may not have identified all of the potential environmental liabilities at our leased and owned properties, and any such liabilities identified in the future could cause us to incur significant costs, including costs associated with litigation, fines or clean-up responsibilities.
While we employ environmental review standards and practices in the current development of our real estate, we have not conducted a comprehensive environmental review of all of our properties and we may not have identified all of the potential environmental liabilities at our leased and owned properties, and any such liabilities identified in the future could cause us to incur significant unknown costs, including costs associated with litigation, fines or clean-up responsibilities, as well as an impact to our real estate values.
In addition to many of the factors described in this risk factors section, our business outside of the United States is subject to a number of additional risks and uncertainties, including international economic and political conditions, risk of corruption and violations of the U.S.
In addition to many of the factors described in this risk factors section, our business outside of the United States is subject to a number of additional risks and uncertainties, including international economic and geopolitical conditions or conflicts, risk of corruption and violations of the U.S.
Our business is susceptible to increases in commodity and other operating costs as a result of various factors beyond our control, such as general economic conditions, inflation, industry demand, energy costs, food safety concerns, animal disease outbreaks, product recalls and government regulations.
Our business is susceptible to increases in commodity and other operating costs as a result of various factors beyond our control, such as general economic conditions, inflation, industry demand, commodity supply and the availability of alternative suppliers, energy costs, food safety concerns, animal disease outbreaks, product recalls and government regulations.
Foreign Corrupt Practices Act or similar anti-corruption and anti-bribery laws of other countries, the inability to adapt to differing cultures or consumer preferences, inadequate brand infrastructure to support our international activities, inability to obtain adequate supplies meeting our quality standards and product specifications or interruptions in obtaining such supplies, challenges and risks associated with managing and monitoring suppliers, restrictions on our ability to move cash out of certain foreign countries, currency regulations and fluctuations, tariffs and trade barriers or foreign policy changes, diverse government regulations and tax systems, uncertain or differing interpretations of rights and obligations in connection with international franchise agreements, the collection of royalties and other fees from international franchisees, the inability to protect technology, data or intellectual property rights, compliance with international privacy and information security laws and regulations, the availability and cost of land, construction costs, other legal, financial or regulatory impediments to the development or operation of restaurants, the inability to identify, attract and retain experienced management, qualified franchisees and joint venture partners.
Foreign Corrupt Practices Act or similar anti-corruption and anti-bribery laws of other countries, the inability to adapt to differing cultures or consumer preferences, inadequate brand infrastructure to support our international activities, inability to obtain adequate supplies meeting our quality standards and product specifications or interruptions in obtaining such supplies, challenges and risks associated with managing and monitoring suppliers, restrictions on our ability to move cash out of certain foreign countries, currency regulations and fluctuations in exchange rates, tariffs and trade barriers or foreign policy changes, diverse government regulations and tax systems, uncertain or differing interpretations of rights and obligations in connection with international franchise agreements, the collection of royalties and other fees from international franchisees, the inability to protect technology, data or intellectual property rights, compliance with international privacy and information security laws and regulations, the availability and cost of land, construction costs, other legal, financial or regulatory impediments to the development or operation of restaurants, changing labor conditions and difficulties in staffing and managing our foreign operations and identifying qualified franchisees and joint venture partners.
We are heavily dependent on computer systems and information technology and any material failure, interruption or degradation of our systems or technology or issues with our key technology providers could adversely affect our business, results of operations and financial condition.
We and our franchisees are heavily dependent on computer systems and information technology and any material failure, interruption or degradation of our systems or technology or those of our key technology providers could adversely affect our business, results of operations and financial condition.
General Business Risks Complaints or litigation could hurt our brand, business, results of operations and financial condition.
Complaints or litigation could hurt our brand, business, results of operations and financial condition.
Failure to meet applicable data privacy requirements could result in legal proceedings and substantial penalties and adversely impact our business and financial condition.
Failure to meet applicable data privacy requirements could result in legal proceedings and substantial penalties and adversely impact our business, results of operations and financial condition.
Shortages or interruptions in the supply of perishable food products caused by unanticipated demand, problems in production or distribution, labor shortages, disease or food-borne illnesses, political unrest, health epidemics or pandemics, inclement weather or other calamities or conditions could adversely affect the availability, quality and cost of ingredients, which could lower revenues, increase operating costs, damage brand reputation and otherwise harm our business and the businesses of our franchisees.
Shortages or interruptions in the supply of perishable food products caused by unanticipated demand, problems in production or distribution, labor disruptions, technology-related problems, financial distress or insolvency of suppliers or distributors, disease or food-borne illnesses, political unrest, health epidemics or pandemics, inclement weather or other calamities or conditions could adversely affect the availability, quality and cost of ingredients, which could lower revenues, increase operating costs, damage brand reputation and otherwise harm our business and the businesses of our franchisees.
Increased labor costs due to competition, inflationary pressures, increased wages or employee benefits costs (including various federal, state and local actions to increase minimum wages and enhance workplace conditions), health epidemics or pandemics (such as the COVID-19 pandemic) or 22 other factors have adversely impacted and could continue to adversely impact our cost of sales and operating expenses.
Increased labor costs due to competition, labor shortages (including due to changes in immigration laws and enforcement), inflationary pressures, increased wages or employee benefits costs (including various federal, state and local actions to increase minimum wages and enhance workplace conditions), health epidemics or pandemics (such as the COVID-19 pandemic) or other factors have adversely impacted and could continue to adversely impact our cost of sales and operating expenses.
We receive revenues in the form of royalties and national advertising funds contributions (both of which are generally based on a percentage of sales at franchised restaurants), as well as rent and fees from franchisees. Accordingly, a substantial portion of our financial results is to a large extent dependent upon the operational and financial success of our franchisees.
We receive revenues in the form of royalties and national advertising funds contributions (both of which are generally based on a percentage of sales at franchised restaurants), as well as rent and fees from franchisees. Accordingly, a substantial portion of our financial results depends upon the operational and financial success of our franchisees.
Ongoing disruptions in the national and global economies may adversely impact our business, results of operations and financial condition. Additionally, adverse economic conditions in regions that contain a high concentration of Wendy’s restaurants, including markets in which Company-operated restaurants are located, could also have a material adverse impact on our results of operations.
Additionally, adverse economic conditions or disruptions in the economies in regions that contain a high concentration of Wendy’s restaurants, including markets in which Company-operated restaurants are located, could also have a material adverse impact on our business, results of operations and financial condition.
Our business and results of operations could be adversely affected if a significant number of franchisees do not participate in brand strategies, such as new restaurant development, restaurant remodeling initiatives, marketing and menu programs and digital commerce platforms and other restaurant technologies, which in turn may harm our business and financial condition.
Our business and results of operations could be adversely affected if a significant number of franchisees do not participate in brand strategies, such as new restaurant development, restaurant remodeling initiatives, marketing and menu programs and digital commerce platforms and other restaurant technologies.
In the event that a rapid amortization event occurs under the Indenture (including, without limitation, upon an event of default under the Indenture or the failure to repay the securitized debt at the end of the applicable term), the funds available to the Company would be reduced or eliminated, which would in turn reduce our ability to operate or grow our business.
In the event that a rapid amortization event occurs under the Indenture (including, without limitation, upon an event of default under the Indenture or the failure to repay the securitized debt on the applicable scheduled payment dates), the funds available to the Company would be reduced or eliminated, which would in turn reduce our ability to operate or grow our business.
These factors include, among others: (i) our ability to attract new franchisees; (ii) the level of participation in, and success of, our build to suit development fund and other development programs; (iii) the attractiveness of our development incentive initiatives to new and existing franchisees; (iv) the availability of site locations for new restaurants; (v) the ability of restaurant owners to obtain financing; (vi) the ability of restaurant owners to attract, train and retain qualified operating personnel; (vii) construction and development costs; (viii) the ability of restaurant owners to secure required governmental approvals and permits in a timely manner, or at all; (ix) the ability of us and our franchises to execute our development strategy for non-traditional restaurants, such as those located in fuel and transportation centers, food courts and other retail locations, delivery kitchens and military bases; (x) the profitability of existing and new restaurants; and (xi) adverse weather conditions.
These factors include, among others: (i) our ability to attract new franchisees; (ii) the level of participation in, and success of, our development assistance programs; (iii) the attractiveness of our development incentive initiatives to new and existing franchisees; (iv) the availability of site locations for new restaurants; (v) the financial health of our franchisees and their ability to obtain financing; (vi) the ability of restaurant owners to attract, train and retain qualified operating personnel; (vii) development costs and the cost and availability of construction materials; (viii) the ability of restaurant owners to secure required governmental approvals and permits in a timely manner, or at all; (ix) the ability of us and our franchises to execute our development strategy for non-traditional restaurants, such as those located in fuel and transportation centers, food courts 20 and other retail locations, delivery kitchens and military bases; (x) the profitability of existing and new restaurants; (xi) consumer acceptance of any restaurant remodels or rebranding; and (xii) adverse weather conditions.
If sales trends or economic conditions worsen for franchisees, or if the overall business or financial health of franchisees deteriorates, their results of operations or financial condition may worsen, which could result in, among other things, increased restaurant closures, decreased restaurant openings, required financial support or franchisee bankruptcies or restructuring activities, all of which could reduce our royalty, national advertising funds, rent and other fee revenues.
If sales trends or economic conditions worsen for franchisees, or if the overall business or financial health of franchisees deteriorates, their results of operations or financial condition may worsen, which has in the past and could again in the future result in, among other things, increased restaurant closures, decreased restaurant openings or franchisee bankruptcies or insolvency leading to restructuring activities, all of which could reduce our royalty, national advertising funds, rent and other fee revenues.
We have a significant amount of debt outstanding, and such indebtedness could adversely affect our business, results of operations and financial condition. As of December 29, 2024, the Company had approximately $2.7 billion of outstanding debt on its balance sheet.
We have a significant amount of debt outstanding, and such indebtedness could adversely affect our business, results of operations and financial condition. As of December 28, 2025, the Company had approximately $2.8 billion of outstanding debt on its balance sheet.
Unforeseen events, including a health epidemic or pandemic, have in the past, and could again in the future, also heighten other risks disclosed in this risk factors section, including, but not limited to, those related to brand value and perception, consumer preferences, our ability to maintain or grow market share, new restaurant development, commodity costs, labor, supply chain and purchasing and international operations.
Unforeseen events, including a health pandemic, have in the past, and could again in the future, also heighten other risks disclosed in this risk factors section, including, but not limited to, those related to brand value and perception, consumer preferences, our ability to maintain or grow market share, franchisee health, new restaurant development, commodity costs, labor, supply chain and purchasing and international operations. 16 Risks Related to Brand Perception and Value Our success depends substantially on our corporate reputation and on the value and perception of our brand.
The success of our business strategy depends, in part, on our continued ability to use our trademarks and service marks to increase brand awareness and further develop our branded products in existing and new markets.
The success of our business strategy depends, in part, on our continued ability to use our intellectual property to increase brand awareness and further develop our branded products in existing and new markets.
We rely on a combination of trademarks, service marks, copyrights, domain names, trade secrets and similar intellectual property rights to protect our brand and other intellectual property.
Our intellectual property is material to the conduct of our business. We rely on a combination of trademarks, service marks, copyrights, domain names, trade secrets and similar intellectual property rights to protect our brand and other intellectual property.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWhile our Board has primary responsibility for risk oversight, the Board’s standing committees support the Board by addressing various risks within their respective areas of responsibility.
Biggest changeCybersecurity Governance Role of the Board Our Board of Directors provides oversight with respect to our risk assessment and risk management activities, including our cybersecurity risk management strategy. While our Board has primary responsibility for risk oversight, the Board’s standing committees support the Board by addressing various risks within their respective areas of responsibility.
The CIO possesses both academic and industry experience, including leading multiple global retail and technology companies through technology implementation and modernization utilizing industry best practices. Our CISO reports to the CIO and directs, coordinates, plans and organizes information security activities throughout the Company, including leading the development of our cybersecurity risk management strategy.
The CIO possesses both academic and industry experience, including leading multiple global retail and technology companies through technology implementation and modernization utilizing industry best practices. Our CISO reports to the CIO and directs, coordinates, plans and organizes information security activities throughout the Company, including leading the development of our cybersecurity risk 31 management strategy.
These risk assessments involve input from key stakeholders, including those with assigned accountability for managing risk and supporting technical risk subject matter expertise, and consider a variety of factors, including our global business strategy, operations and support, information systems and data assets. 29 • Infrastructure.
These risk assessments involve input from key stakeholders, including those with assigned accountability for managing risk and supporting technical risk subject matter expertise, and consider a variety of factors, including our global business strategy, operations and support, information systems and data assets. • Infrastructure.
We maintain an incident response plan that sets forth immediate response actions, internal and external communication protocols, stakeholder involvement based on the nature of the incident and post-incident analysis processes.
We maintain an incident response plan that sets forth immediate response actions, internal and external communication protocols, stakeholder involvement based on the nature of the incident and post-incident 30 analysis processes.
There can be no assurance that our cyber insurance policies will be sufficient in scope or amount to cover the costs and expenses related to any future incidents. In 2024, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
There can be no assurance that our cyber insurance policies will be sufficient in scope or amount to cover the costs and expenses related to any future incidents. In 2025, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
However, as described above, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents. For additional information about these risks, see “Item 1A.
However, as described above, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents. For additional information about these risks, see “Item 1A. Risk Factors—Risks Related to Technology and Cybersecurity” of this Form 10-K.
We have several dedicated teams of cybersecurity specialists, including teams focused on executing internal and external vulnerability and penetration assessments, designing secure systems and applications, monitoring for intrusions and providing incident response. We have made significant investments in technology insourcing and reassumed direct ownership of certain information security related teams and functions. • Training.
We have several dedicated teams of cybersecurity specialists, including teams focused on executing internal and external vulnerability and penetration assessments, designing secure systems and applications, monitoring for intrusions and providing incident response. • Training.
Removed
Risk Factors—Risks Related to Technology and Cybersecurity” of this Form 10-K. 30 Cybersecurity Governance Role of the Board Our Board of Directors provides oversight with respect to our risk assessment and risk management activities, including our cybersecurity risk management strategy.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWendy’s also held leases covering the land and building for each of the 13 Company-operated restaurants in the Wendy’s International segment. Lease terms are generally initially between 15 and 20 years and, in most cases, provide for rent escalations and renewal options.
Biggest changeOf the 11 Company-operated restaurants in the Wendy’s International segment, Wendy’s owned the building and held long-term land leases for one restaurant and held leases covering the land and building for 10 restaurants. Lease terms are generally initially between 15 and 20 years and, in most cases, provide for rent escalations and renewal options.
Item 2. Properties. We believe that our properties, taken as a whole, are generally well maintained and are adequate for our current and foreseeable business needs. The following table contains information about our principal office facilities as of December 29, 2024: ACTIVE FACILITIES FACILITIES LOCATION LAND TITLE APPROXIMATE SQ. FT.
Item 2. Properties. We believe that our properties, taken as a whole, are generally well maintained and are adequate for our current and foreseeable business needs. The following table contains information about our principal office facilities as of December 28, 2025: ACTIVE FACILITIES FACILITIES LOCATION LAND TITLE APPROXIMATE SQ. FT.
Certain leases contain contingent rent provisions that require additional rental payments based upon restaurant sales volume in excess of specified amounts. As part of the Global Real Estate & Development segment, Wendy’s also owned 486 and leased 1,155 properties that were either leased or subleased principally to franchisees as of December 29, 2024.
Certain leases contain contingent rent provisions that require additional rental payments based upon restaurant sales volume in excess of specified amounts. As part of the Global Real Estate & Development segment, Wendy’s also owned 491 and leased 1,146 properties that were either leased or subleased principally to franchisees as of December 28, 2025.
The Corporate Headquarters serves all of our operating segments. ** The Wendy’s Restaurants of Canada Inc. facility primarily serves the International operating segment. 31 At December 29, 2024, Wendy’s and its franchisees operated 7,240 Wendy’s restaurants.
The Corporate Headquarters serves all of our operating segments. ** The Wendy’s Restaurants of Canada Inc. facility primarily serves the International operating segment. At December 28, 2025, Wendy’s and its franchisees operated 7,397 Wendy’s restaurants.
Of the 381 Company-operated restaurants in the Wendy’s U.S. segment, Wendy’s owned the land and building for 151 restaurants, owned the building and held long-term land leases for 136 restaurants and held leases covering the land and building for 94 restaurants.
Of the 423 Company-operated restaurants in the Wendy’s U.S. segment, Wendy’s owned the land and building for 155 restaurants, owned the building and held long-term land leases for 141 restaurants and held leases covering the land and building for 127 restaurants.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table provides information with respect to repurchases of shares of our common stock by us and our “affiliated purchasers” (as defined in Rule 10b-18(a)(3) under the Exchange Act) during the fourth fiscal quarter of 2024: Issuer Repurchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plan Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan (2) September 30, 2024 through November 3, 2024 150,058 $ 17.87 150,058 $ 247,683,547 November 4, 2024 through December 1, 2024 350,259 $ 18.66 347,660 $ 241,201,451 December 2, 2024 through December 29, 2024 362,073 $ 17.26 359,733 $ 235,000,021 Total 862,390 $ 17.93 857,451 $ 235,000,021 (1) Includes 4,939 shares of common stock reacquired by the Company from holders of share-based awards to satisfy certain requirements associated with the vesting or exercise of the respective award.
Biggest changeThe following table provides information with respect to repurchases of shares of our common stock by us and our “affiliated purchasers” (as defined in Rule 10b-18(a)(3) under the Exchange Act) during the fourth fiscal quarter of 2025: Issuer Repurchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plan Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan (2) September 29, 2025 through November 2, 2025 1,107 $ 8.87 — $ 35,000,024 November 3, 2025 through November 30, 2025 — $ — — $ 35,000,024 December 1, 2025 through December 28, 2025 288 $ 8.35 — $ 35,000,024 Total 1,395 $ 8.77 — $ 35,000,024 (1) Represents shares of common stock reacquired by the Company from holders of share-based awards to satisfy certain requirements associated with the vesting or exercise of the respective award.
(2) In January 2023, our Board of Directors authorized a repurchase program for up to $500.0 million of our common stock through February 28, 2027, when and if market conditions warrant and to the extent legally permissible (the “January 2023 Authorization”).
(2) In January 2023, our Board of Directors authorized a repurchase program for up to $500.0 million of our common stock through February 28, 2027, when and if market conditions warrant and to the extent legally permissible (the “January 2023 Authorization”). Item 6. [Reserved] 33
Future dividend payments, if any, will be made at the discretion of our Board of Directors and will be based on such factors as the Company’s earnings, financial condition and cash requirements and other factors. As of February 19, 2025, there were approximately 18,059 holders of record of the Company’s common stock.
Future dividend payments, if any, will be made at the discretion of our Board of Directors and will be based on such factors as the Company’s earnings, financial condition and cash requirements and other factors. As of February 16, 2026, there were approximately 17,063 holders of record of the Company’s common stock.
During the first quarter of 2025, the Company declared a dividend of $.25 per share of common stock to be paid on March 17, 2025 to stockholders of record as of March 3, 2025.
During the first quarter of 2026, the Company declared a dividend of $.14 per share of common stock to be paid on March 16, 2026 to stockholders of record as of March 2, 2026.
The Company has no class of equity securities currently issued and outstanding except for its common stock. However, the Company is currently authorized to issue up to 100 million shares of preferred stock. The Company paid quarterly cash dividends of $.25 per share of common stock during each of the first, second, third and fourth quarters of 2023 and 2024.
The Company has no class of equity securities currently issued and outstanding except for its common stock. However, the Company is currently authorized to issue up to 100 million shares of preferred stock.
Removed
Subsequent to December 29, 2024 through February 19, 2025, the Company repurchased 3.4 million shares under the January 2023 Authorization with an aggregate purchase price of $50.4 million, excluding applicable excise tax and commissions. Item 6. [Reserved] 33
Added
The Company paid quarterly cash dividends of $.25 per share of common stock during each of the first, second, third and fourth quarters of 2024 and the first quarter of 2025. The Company paid quarterly cash dividends of $.14 per share of common stock during each of the second, third and fourth quarters of 2025.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeResults of Operations The tables included throughout this Results of Operations section set forth in millions (except as otherwise indicated) the Company’s consolidated results of operations for the years ended December 29, 2024, December 31, 2023 and January 1, 2023. 2024 2023 2022 Amount Change Amount Change Amount Revenues: Sales $ 925.9 $ (4.2) $ 930.1 $ 33.5 $ 896.6 Franchise royalty revenue and fees 626.0 33.7 592.3 34.1 558.2 Franchise rental income 236.5 6.3 230.2 (4.3) 234.5 Advertising funds revenue 458.1 29.1 429.0 22.8 406.2 2,246.5 64.9 2,181.6 86.1 2,095.5 Costs and expenses: Cost of sales 783.2 (11.3) 794.5 21.3 773.2 Franchise support and other costs 67.7 10.5 57.2 10.5 46.7 Franchise rental expense 127.4 2.0 125.4 1.3 124.1 Advertising funds expense 478.1 50.1 428.0 (2.8) 430.8 General and administrative 255.2 5.2 250.0 (5.0) 255.0 Depreciation and amortization (exclusive of amortization of cloud computing arrangements shown separately below) 143.2 7.4 135.8 2.4 133.4 Amortization of cloud computing arrangements 14.7 1.9 12.8 10.4 2.4 System optimization gains, net (1.2) (0.3) (0.9) 5.9 (6.8) Reorganization and realignment costs 8.5 (0.7) 9.2 8.5 0.7 Impairment of long-lived assets 9.7 8.3 1.4 (5.0) 6.4 Other operating income, net (11.4) 2.4 (13.8) 9.9 (23.7) 1,875.1 75.5 1,799.6 57.4 1,742.2 Operating profit 371.4 (10.6) 382.0 28.7 353.3 Interest expense, net (123.9) 0.2 (124.1) (1.8) (122.3) Gain on early extinguishment of debt, net — (2.3) 2.3 2.3 — Investment income (loss), net — 10.4 (10.4) (12.5) 2.1 Other income, net 24.8 (4.8) 29.6 19.2 10.4 Income before income taxes 272.4 (7.0) 279.4 35.9 243.5 Provision for income taxes (78.0) (3.0) (75.0) (8.9) (66.1) Net income $ 194.4 $ (10.0) $ 204.4 $ 27.0 $ 177.4 38 2024 % of Total Revenues 2023 % of Total Revenues 2022 % of Total Revenues Revenues: Sales $ 925.9 41.2 % $ 930.1 42.6 % $ 896.6 42.8 % Franchise royalty revenue and fees: Franchise royalty revenue 528.4 23.5 % 512.1 23.5 % 485.5 23.2 % Franchise fees 97.6 4.4 % 80.2 3.6 % 72.7 3.4 % Total franchise royalty revenue and fees 626.0 27.9 % 592.3 27.1 % 558.2 26.6 % Franchise rental income 236.5 10.5 % 230.2 10.6 % 234.5 11.2 % Advertising funds revenue 458.1 20.4 % 429.0 19.7 % 406.2 19.4 % Total revenues $ 2,246.5 100.0 % $ 2,181.6 100.0 % $ 2,095.5 100.0 % 2024 % of Sales 2023 % of Sales 2022 % of Sales Cost of sales: Food and paper $ 287.2 31.0 % $ 297.4 32.0 % $ 292.9 32.7 % Restaurant labor 298.1 32.2 % 298.5 32.1 % 288.0 32.1 % Occupancy, advertising and other operating costs 197.9 21.4 % 198.6 21.3 % 192.3 21.4 % Total cost of sales $ 783.2 84.6 % $ 794.5 85.4 % $ 773.2 86.2 % 2024 % of Sales 2023 % of Sales 2022 % of Sales Company-operated restaurant margin: U.S. $ 143.6 16.0 % $ 138.6 15.3 % $ 125.9 14.3 % Global 142.7 15.4 % 135.6 14.6 % 123.4 13.8 % The table below presents certain of the Company’s key business measures, which are defined and further discussed in the “Executive Overview” section included herein. 2024 2023 2022 Key business measures: U.S. same-restaurant sales: Company-operated 0.0 % 2.6 % 4.4 % Franchised 1.5 % 3.8 % 3.9 % Systemwide 1.4 % 3.7 % 3.9 % International same-restaurant sales (a) 2.8 % 8.1 % 12.4 % Global same-restaurant sales: Company-operated (0.1) % 2.7 % 4.4 % Franchised (a) 1.7 % 4.4 % 4.9 % Systemwide (a) 1.5 % 4.3 % 4.9 % 39 2024 2023 2022 Key business measures (continued): Systemwide sales (b): U.S.
Biggest changeResults of Operations The tables included throughout this Results of Operations section set forth in millions (except as otherwise indicated) the Company’s consolidated results of operations for the years ended December 28, 2025, December 29, 2024 and December 31, 2023. 2025 2024 2023 Amount Change Amount Change Amount Revenues: Sales $ 916.3 $ (9.6) $ 925.9 $ (4.2) $ 930.1 Franchise royalty revenue and fees 602.7 (23.3) 626.0 33.7 592.3 Franchise rental income 235.8 (0.7) 236.5 6.3 230.2 Advertising funds revenue 422.1 (36.0) 458.1 29.1 429.0 2,176.9 (69.6) 2,246.5 64.9 2,181.6 Costs and expenses: Cost of sales 791.7 8.5 783.2 (11.3) 794.5 Franchise support and other costs 81.0 13.3 67.7 10.5 57.2 Franchise rental expense 125.8 (1.6) 127.4 2.0 125.4 Advertising funds expense 422.6 (55.5) 478.1 50.1 428.0 General and administrative 252.7 (2.5) 255.2 5.2 250.0 Depreciation and amortization (exclusive of amortization of cloud computing arrangements shown separately below) 152.2 9.0 143.2 7.4 135.8 Amortization of cloud computing arrangements 18.6 3.9 14.7 1.9 12.8 System optimization gains, net (1.0) 0.2 (1.2) (0.3) (0.9) Reorganization and realignment costs (0.1) (8.6) 8.5 (0.7) 9.2 Impairment of long-lived assets 12.1 2.4 9.7 8.3 1.4 Other operating income, net (22.2) (10.8) (11.4) 2.4 (13.8) 1,833.4 (41.7) 1,875.1 75.5 1,799.6 Operating profit 343.5 (27.9) 371.4 (10.6) 382.0 Interest expense, net (126.5) (2.6) (123.9) 0.2 (124.1) (Loss) gain on early extinguishment of debt, net (0.6) (0.6) — (2.3) 2.3 Investment loss, net (1.7) (1.7) — 10.4 (10.4) Other income, net 12.5 (12.3) 24.8 (4.8) 29.6 Income before income taxes 227.2 (45.2) 272.4 (7.0) 279.4 Provision for income taxes (62.1) 15.9 (78.0) (3.0) (75.0) Net income $ 165.1 $ (29.3) $ 194.4 $ (10.0) $ 204.4 37 2025 % of Total Revenues 2024 % of Total Revenues 2023 % of Total Revenues Revenues: Sales $ 916.3 42.1 % $ 925.9 41.2 % $ 930.1 42.6 % Franchise royalty revenue and fees: Franchise royalty revenue 504.5 23.2 % 528.4 23.5 % 512.1 23.5 % Franchise fees 98.2 4.5 % 97.6 4.4 % 80.2 3.6 % Total franchise royalty revenue and fees 602.7 27.7 % 626.0 27.9 % 592.3 27.1 % Franchise rental income 235.8 10.8 % 236.5 10.5 % 230.2 10.6 % Advertising funds revenue 422.1 19.4 % 458.1 20.4 % 429.0 19.7 % Total revenues $ 2,176.9 100.0 % $ 2,246.5 100.0 % $ 2,181.6 100.0 % 2025 % of Sales 2024 % of Sales 2023 % of Sales Cost of sales: Food and paper $ 291.6 31.8 % $ 287.2 31.0 % $ 297.4 32.0 % Restaurant labor 296.9 32.4 % 298.1 32.2 % 298.5 32.1 % Occupancy, advertising and other operating costs 203.2 22.2 % 197.9 21.4 % 198.6 21.3 % Total cost of sales $ 791.7 86.4 % $ 783.2 84.6 % $ 794.5 85.4 % 2025 % of Sales 2024 % of Sales 2023 % of Sales Company-operated restaurant margin: U.S. $ 126.1 14.2 % $ 143.6 16.0 % $ 138.6 15.3 % Global 124.6 13.6 % 142.7 15.4 % 135.6 14.6 % The table below presents certain of the Company’s key business measures, which are defined and further discussed in the “Executive Overview” section included herein. 2025 2024 2023 Key business measures: U.S. same-restaurant sales: Company-operated (2.5) % 0.0 % 2.6 % Franchised (5.8) % 1.5 % 3.8 % Systemwide (5.6) % 1.4 % 3.7 % International same-restaurant sales (a) 1.3 % 2.8 % 8.1 % Global same-restaurant sales: Company-operated (2.5) % (0.1) % 2.7 % Franchised (a) (4.8) % 1.7 % 4.4 % Systemwide (a) (4.7) % 1.5 % 4.3 % 38 2025 2024 2023 Key business measures (continued): Systemwide sales (b): U.S.
The result of applying the guideline company approach is adjusted based on the incremental value 49 associated with a controlling interest in the business. This “control premium” represents the amount a new controlling stockholder would pay for the benefits resulting from synergies and other potential benefits derived from controlling the enterprise.
The result of applying the guideline company approach is adjusted based on the incremental value associated with a controlling interest in the business. This “control premium” represents the amount a new controlling stockholder would pay for the benefits resulting from synergies and other potential benefits derived from controlling the enterprise.
Our quantitative process includes comparing the carrying value to the fair value of our indefinite-lived intangible assets, with any excess recognized as an impairment loss. Our critical estimates in the determination of the fair value of our indefinite-lived intangible assets include the anticipated future revenues of Company-operated and franchised restaurants and the resulting cash flows.
Our quantitative process includes comparing the carrying value to the fair value of our 48 indefinite-lived intangible assets, with any excess recognized as an impairment loss. Our critical estimates in the determination of the fair value of our indefinite-lived intangible assets include the anticipated future revenues of Company-operated and franchised restaurants and the resulting cash flows.
Should actual cash flows and our future estimates vary adversely from those estimates we used, we may be required to recognize additional impairment charges in future years. 50 • Our ability to realize deferred tax assets: We account for income taxes under the asset and liability method.
Should actual cash flows and our future estimates vary adversely from those estimates we used, we may be required to recognize additional impairment charges in future years. • Our ability to realize deferred tax assets: We account for income taxes under the asset and liability method.
Company-operated and franchise restaurants reporting unit, Canada franchise restaurants reporting unit and global real estate and development operations reporting unit, respectively. We test goodwill for impairment annually, or more frequently if events or changes in circumstances indicate that the asset may be impaired.
Company-operated and franchise restaurants reporting unit, Canada franchise restaurants reporting unit and global real estate and development operations reporting unit, respectively. 47 We test goodwill for impairment annually, or more frequently if events or changes in circumstances indicate that the asset may be impaired.
Our evaluation of the realizability of our deferred tax assets is subject to change as a result of many factors including, among others, any changes in our business plans, changing economic conditions, the competitive environment and the effect of future tax legislation.
Our evaluation of the realizability of our deferred tax assets is subject to change as a result of many factors including, among others, any changes in our business plans, changing economic 49 conditions, the competitive environment and the effect of future tax legislation.
New Accounting Standards See Note 1 to the Consolidated Financial Statements contained in Item 8 herein for a summary of new or amended accounting standards applicable to us. 51
New Accounting Standards See Note 1 to the Consolidated Financial Statements contained in Item 8 herein for a summary of new or amended accounting standards applicable to us.
As part of the CAP, tax years are examined on a contemporaneous basis so that all or most issues are resolved prior to the filing of the tax return. As such, our tax returns for fiscal years through 2022 have been settled. The Company or one of its subsidiaries also files tax returns in various state, local and foreign jurisdictions.
As part of the CAP, tax years are examined on a contemporaneous basis so that all or most issues are resolved prior to the filing of the tax return. As such, our tax returns for fiscal years through 2023 have been settled. The Company or one of its subsidiaries also files tax returns in various state, local and foreign jurisdictions.
In addition, the Company is party to a revolving financing facility of Series 2021-1 Variable Funding Senior Secured Notes, Class A-1 (the “Class A-1 Notes”), which allows for the drawing of up to $300.0 million on a revolving basis using various credit instruments, including a letter of credit facility. No amounts were borrowed under the Class A-1 Notes during 2024.
In addition, the Company is party to a revolving financing facility of Series 2021-1 Variable Funding Senior Secured Notes, Class A-1 (the “Class A-1 Notes”), which allows for the drawing of up to $300.0 million on a revolving basis using various credit instruments, including a letter of credit facility. No amounts were borrowed under the Class A-1 Notes during 2025.
While the Company does not expect this enactment will have a material impact on the Consolidated Financial Statements contained in Item 8 herein, we will continue to evaluate and monitor as additional guidance and clarification becomes available. Segment Information See Note 25 to the Consolidated Financial Statements contained in Item 8 herein for further information regarding the Company’s segments.
While the Company does not expect this enactment will have a material impact on the Consolidated Financial Statements contained in Item 8 herein, we will continue to evaluate and monitor as additional guidance and clarification becomes available. Segment Information See Note 26 to the Consolidated Financial Statements contained in Item 8 herein for further information regarding the Company’s segments.
The statute of limitations in these jurisdictions vary but generally income tax returns from its 2019 fiscal year and forward remain subject to examination. We believe that adequate provisions have been made for any liabilities, including interest and penalties that may result from the completion of these examinations.
The statute of limitations in these jurisdictions vary but generally income tax returns from its 2020 fiscal year and forward remain subject to examination. We believe that adequate provisions have been made for any liabilities, including interest and penalties that may result from the completion of these examinations.
For the annual goodwill impairment test in the fourth quarter of 2024, we elected to perform a qualitative assessment for the U.S. Company-operated and franchise restaurants reporting unit and the Canada franchise restaurants reporting unit, and we performed a quantitative goodwill impairment test for the global real estate and development operations reporting unit.
For the annual goodwill impairment test in the fourth quarter of 2025, we elected to perform a qualitative assessment for the U.S. Company-operated and franchise restaurants reporting unit and the Canada franchise restaurants reporting unit, and we performed a quantitative goodwill impairment test for the global real estate and development operations reporting unit.
Inherent volatility experienced in certain commodity markets, such as those for beef, chicken, eggs, pork, cheese and grains, could have a significant effect on our results of operations and may have an adverse effect on us in the future.
Inherent volatility experienced in certain commodity markets, such as those for beef, chicken, eggs, pork, dairy and grains, could have a significant effect on our results of operations and may have an adverse effect on us in the future.
For the annual impairment test of our indefinite-lived intangible assets in the fourth quarter of 2024, we elected to perform a qualitative assessment. The qualitative assessment indicated the fair value of our indefinite-lived intangible assets was more likely than not greater than the carrying amount.
For the annual impairment test of our indefinite-lived intangible assets in the fourth quarter of 2025, we elected to perform a qualitative assessment. The qualitative assessment indicated the fair value of our indefinite-lived intangible assets was more likely than not greater than the carrying amount.
Our impairment losses principally reflect impairment charges resulting from the decision to close certain Company-operated restaurants and the deterioration in operating performance of certain other Company-operated restaurants. Our fair value estimates are subject to change as a result of many factors including, among others, any changes in our business plans, changing economic conditions and the competitive environment.
Our impairment losses principally reflect impairment charges resulting from the deterioration in operating performance of certain Company-operated restaurants. Our fair value estimates are subject to change as a result of many factors including, among others, any changes in our business plans, changing economic conditions and the competitive environment.
For discussion related to 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K, please refer to Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2023 Form 10-K, filed with the United States Securities and Exchange Commission on February 26, 2024.
For discussion related to 2023 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K, please refer to Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Form 10-K, filed with the United States Securities and Exchange Commission on February 21, 2025.
We believe it is more likely than not that the benefit from certain net operating loss carryforwards and tax credits will not be realized. In recognition of this risk, we have provided a valuation allowance of $38.5 million. • Income tax uncertainties: We measure income tax uncertainties in accordance with a two-step process of evaluating a tax position.
We believe it is more likely than not that the benefit from certain net operating loss carryforwards and tax credits will not be realized. In recognition of this risk, we have provided a valuation allowance of $44.7 million. • Income tax uncertainties: We measure income tax uncertainties in accordance with a two-step process of evaluating a tax position.
See “Results of Operations” below and Note 25 to the Consolidated Financial Statements contained in Item 8 herein for segment financial information.
See “Results of Operations” below and Note 26 to the Consolidated Financial Statements contained in Item 8 herein for segment financial information.
The extent of any impact will depend on our ability to manage such volatility through product mix and selective menu price increases. Seasonality Wendy’s restaurant operations are moderately seasonal. Wendy’s average restaurant sales are normally higher during the summer months than during the winter months.
The extent of any impact will depend on our ability to manage such volatility through selective menu price increases, product mix and focused execution of operational excellence. Seasonality Wendy’s restaurant operations are moderately seasonal. Wendy’s average restaurant sales are normally higher during the summer months than during the winter months.
The Company’s fiscal reporting periods consist of 52 or 53 weeks ending on the Sunday closest to December 31 and are referred to herein as (1) “the year ended December 29, 2024” or “2024,” (2) “the year ended December 31, 2023” or “2023,” and (3) “the year ended January 1, 2023” or “2022,” all of which consisted of 52 weeks.
The Company’s fiscal reporting periods consist of 52 or 53 weeks ending on the Sunday closest to December 31 and are referred to herein as (1) “the year ended December 28, 2025” or “2025,” (2) “the year ended December 29, 2024” or “2024,” and (3) “the year ended December 31, 2023” or “2023,” all of which consisted of 52 weeks.
The Company believes that these metrics are important supplemental measures of operating performance because they highlight trends in the Company’s business that may not otherwise be apparent when relying solely on GAAP financial measures.
The Company believes that these metrics are important supplemental measures of operating performance because they highlight trends in the Company’s business that may not otherwise be apparent when relying solely on our consolidated financial statements.
Company-operated restaurant margin is influenced by factors such as price increases, the effectiveness of our advertising and marketing initiatives, featured products, product mix, fluctuations in food and labor costs, restaurant openings, remodels and closures and the level of our fixed and semi-variable costs. • Systemwide Sales - Systemwide sales is a non-GAAP financial measure, which includes sales by both Company-operated restaurants and franchised restaurants.
Company-operated restaurant margin is influenced by factors such as price increases, the effectiveness of our advertising and marketing initiatives, featured products, product mix, fluctuations in food and labor costs, restaurant openings, remodels and closures and the level of our fixed and semi-variable costs. • Systemwide Sales - Systemwide sales includes sales by both Company-operated restaurants and franchised restaurants.
(b) During 2024 and 2023, global systemwide sales increased 3.1% and 6.1%, respectively, U.S. systemwide sales increased 2.2% and 5.1%, respectively, and international systemwide sales increased 9.0% and 14.1%, respectively, on a constant currency basis. The table below presents details regarding the change in restaurant counts of the Wendy’s system from 2022 to 2024. U.S. Company-operated U.S.
(b) During 2025 and 2024, global systemwide sales decreased 3.5% and increased 3.1%, respectively, U.S. systemwide sales decreased 5.2% and increased 2.2%, respectively, and international systemwide sales increased 8.1% and 9.0%, respectively, on a constant currency basis. The table below presents details regarding the change in restaurant counts of the Wendy’s system from 2023 to 2025. U.S. Company-operated U.S.
We may from time to time seek to repurchase portions of our outstanding long-term debt, including our 7% debentures and/or our senior secured notes, through open market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
We may from time to time seek to repurchase portions of our outstanding long-term debt through open market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
We accrue interest related to uncertain tax positions in “Provision for income taxes.” As of December 29, 2024, we had $1.4 million accrued for interest. The Company participates in the Internal Revenue Service (the “IRS”) Compliance Assurance Process (“CAP”).
We accrue interest related to uncertain tax positions in “Provision for income taxes.” As of December 28, 2025, we had $1.1 million accrued for interest. The Company participates in the Internal Revenue Service (the “IRS”) Compliance Assurance Process (“CAP”).
Our quantitative goodwill impairment test for our global real estate and development operations reporting unit indicated that there had been no impairment and the fair value of this reporting unit of approximately $1,500.0 million was approximately 29% in excess of its carrying value. Our indefinite-lived intangible assets represent trademarks and totaled $903.0 million as of December 29, 2024.
Our quantitative goodwill impairment test for our global real estate and development operations reporting unit indicated that there had been no impairment and the fair value of this reporting unit of approximately $1,400.0 million was approximately 18% in excess of its carrying value. Our indefinite-lived intangible assets represent trademarks and totaled $903.0 million as of December 28, 2025.
Franchised restaurant average unit volumes is a non-GAAP financial measure, which includes sales by franchised restaurants, which are reported by our franchisees and represent their revenue from sales at franchised Wendy’s restaurants. The Company’s consolidated financial statements do not include sales by franchised restaurants to their customers.
Franchised restaurant average unit volumes includes sales by franchised restaurants, which are reported by our franchisees and represent their revenue from sales at franchised Wendy’s restaurants. The Company’s consolidated financial statements do not include sales by franchised restaurants to their customers.
Should future taxable income vary from projected taxable income, we may be required to adjust our valuation allowance in future years. Net operating loss and credit carryforwards are subject to various limitations and carryforward periods. As of December 29, 2024, we have foreign tax credits of $22.2 million that will begin to expire in 2027.
Should future taxable income vary from projected taxable income, we may be required to adjust our valuation allowance in future years. Net operating loss and credit carryforwards are subject to various limitations and carryforward periods. As of December 28, 2025, we have foreign tax credits of $26.6 million that will begin to expire in 2027.
Should actual cash flows and our future estimates vary adversely from those estimates we use, we may be required to recognize impairment charges in future years. • Impairment of long-lived assets: As of December 29, 2024, the total net carrying value of our long-lived tangible and definite-lived intangible assets was $2,121.8 million.
Should actual cash flows and our future estimates vary adversely from those estimates we use, we may be required to recognize impairment charges in future years. • Impairment of long-lived assets: As of December 28, 2025, the total net carrying value of our long-lived tangible and definite-lived intangible assets was $2,160.9 million.
Investment Income (Loss), Net 2024 2023 2022 Amount Change Amount Change Amount Investment income (loss), net $ — $ 10.4 $ (10.4) $ (12.5) $ 2.1 During 2023, the Company recorded a loss of $10.4 million due to impairment charges for the difference between estimated fair value and the carrying value of an investment in equity securities.
Investment Loss, Net 2025 2024 2023 Amount Change Amount Change Amount Investment loss, net $ 1.7 $ 1.7 $ — $ (10.4) $ 10.4 During 2025, the Company recorded a loss of $1.7 million due to impairment charges for the difference between the estimated fair value and the carrying value of an investment in equity securities.
A tax position that meets the more-likely-than-not recognition threshold is then measured, for purposes of financial statement recognition, as the largest amount that has a greater than 50% likelihood of being realized upon effective settlement. We have unrecognized tax benefits of $14.8 million, which if resolved favorably would reduce our tax expense by $11.7 million as of December 29, 2024.
A tax position that meets the more-likely-than-not recognition threshold is then measured, for purposes of financial statement recognition, as the largest amount that has a greater than 50% likelihood of being realized upon effective settlement. We have unrecognized tax benefits of $19.0 million, which if resolved favorably would reduce our tax expense by $15.0 million as of December 28, 2025.
All references to years, quarters and months relate to fiscal periods rather than calendar periods. Executive Overview Our Business As of December 29, 2024, the Wendy’s restaurant system was comprised of 7,240 restaurants, with 5,933 Wendy’s restaurants in operation in the U.S.
All references to years, quarters and months relate to fiscal periods rather than calendar periods. Executive Overview Our Business As of December 28, 2025, the Wendy’s restaurant system was comprised of 7,397 restaurants, with 5,969 Wendy’s restaurants in operation in the U.S.
Today, Wendy’s is the second largest quick-service restaurant company in the hamburger sandwich segment in the U.S. based on traffic and dollar share, and the third largest globally with 7,240 restaurants in the U.S. and 31 foreign countries and U.S. territories as of December 29, 2024.
Today, Wendy’s is the second largest quick-service restaurant company in the hamburger sandwich segment in the U.S. based on traffic and dollar share, and the third largest globally with 7,397 restaurants in the U.S. and 38 foreign countries and U.S. territories as of December 28, 2025.
Cost of sales excludes certain costs that support restaurant operations that are not allocated to individual restaurants, which are included in “General and administrative.” Cost of sales also excludes depreciation and amortization expense and impairment of long-lived assets.
Cost of sales includes food and paper, restaurant labor and occupancy, advertising and other operating costs. Cost of sales excludes certain costs that support restaurant operations that are not allocated to individual restaurants, which are included in “General and administrative.” Cost of sales also excludes depreciation and amortization expense and impairment of long-lived assets.
Wendy’s International 2024 2023 2022 Amount Change Amount Change Amount Sales $ 27.0 $ 2.6 $ 24.4 $ 10.5 $ 13.9 Franchise royalty revenue 71.7 4.2 67.5 6.0 61.5 Franchise fees 9.3 2.9 6.4 0.8 5.6 Advertising fund revenue 36.6 4.4 32.2 6.5 25.7 Total revenues $ 144.7 $ 14.2 $ 130.5 $ 23.8 $ 106.7 Segment profit $ 43.3 $ 7.6 $ 35.7 $ 5.3 $ 30.4 The increase in Wendy’s International revenues during 2024 was primarily due to (1) net new restaurant development and (2) an increase in franchise same-restaurant sales.
Wendy’s International 2025 2024 2023 Amount Change Amount Change Amount Sales $ 28.8 $ 1.8 $ 27.0 $ 2.6 $ 24.4 Franchise royalty revenue 75.5 3.8 71.7 4.2 67.5 Franchise fees 11.1 1.8 9.3 2.9 6.4 Advertising fund revenue 37.6 1.0 36.6 4.4 32.2 Total revenues $ 153.0 $ 8.3 $ 144.7 $ 14.2 $ 130.5 Segment profit $ 43.1 $ (0.2) $ 43.3 $ 7.6 $ 35.7 The increase in Wendy’s International revenues during 2025 was primarily due to (1) net new restaurant development and (2) an increase in franchise same-restaurant sales.
Cash Flows from Operating, Investing and Financing Activities The table below summarizes our cash flows from operating, investing and financing activities for each of the past three fiscal years: 2024 2023 2022 Amount Change Amount Change Amount Net cash provided by (used in): Operating activities $ 355.3 $ 9.9 $ 345.4 $ 85.5 $ 259.9 Investing activities (129.3) (42.8) (86.5) (8.7) (77.8) Financing activities (303.1) 201.2 (504.3) (793.0) 288.7 Effect of exchange rate changes on cash (8.1) (10.5) 2.4 8.4 (6.0) Net (decrease) increase in cash, cash equivalents and restricted cash $ (85.2) $ 157.8 $ (243.0) $ (707.8) $ 464.8 Operating Activities Cash provided by operating activities consists primarily of net income, adjusted for non-cash expenses such as depreciation and amortization, deferred income tax and share-based compensation, and the net change in operating assets and liabilities. 47 Cash provided by operating activities was $355.3 million and $345.4 million in 2024 and 2023, respectively.
Cash Flows from Operating, Investing and Financing Activities The table below summarizes our cash flows from operating, investing and financing activities for each of the past three fiscal years: 2025 2024 2023 Amount Change Amount Change Amount Net cash provided by (used in): Operating activities $ 344.5 $ (10.8) $ 355.3 $ 9.9 $ 345.4 Investing activities (150.8) (21.5) (129.3) (42.8) (86.5) Financing activities (344.0) (40.9) (303.1) 201.2 (504.3) Effect of exchange rate changes on cash 4.4 12.5 (8.1) (10.5) 2.4 Net decrease in cash, cash equivalents and restricted cash $ (145.9) $ (60.7) $ (85.2) $ 157.8 $ (243.0) Operating Activities Cash provided by operating activities consists primarily of net income, adjusted for non-cash expenses such as depreciation and amortization, deferred income tax and share-based compensation, and the net change in operating assets and liabilities.
We believe that the following represent our more critical estimates and assumptions used in the preparation of our consolidated financial statements: • Impairment of goodwill and indefinite-lived intangible assets: Our goodwill totaled $771.5 million as of December 29, 2024, of which $620.6 million, $28.4 million and $122.5 million was allocated to our U.S.
We believe that the following represent our more critical estimates and assumptions used in the preparation of our consolidated financial statements: • Impairment of goodwill and indefinite-lived intangible assets: Our goodwill totaled $774.1 million as of December 28, 2025, of which $621.9 million, $29.7 million and $122.5 million was allocated to our U.S.
Cost of Sales, as a Percent of Sales 2024 2023 2022 Amount Change Amount Change Amount Food and paper 31.0 % (1.0) % 32.0 % (0.7) % 32.7 % Restaurant labor 32.2 % 0.1 % 32.1 % — % 32.1 % Occupancy, advertising and other operating costs 21.4 % 0.1 % 21.3 % (0.1) % 21.4 % 84.6 % (0.8) % 85.4 % (0.8) % 86.2 % The decrease in cost of sales, as a percent of sales, during 2024 was primarily due to (1) higher average check and (2) labor efficiencies.
Cost of Sales, as a Percent of Sales 2025 2024 2023 Amount Change Amount Change Amount Food and paper 31.8 % 0.8 % 31.0 % (1.0) % 32.0 % Restaurant labor 32.4 % 0.2 % 32.2 % 0.1 % 32.1 % Occupancy, advertising and other operating costs 22.2 % 0.8 % 21.4 % 0.1 % 21.3 % 86.4 % 1.8 % 84.6 % (0.8) % 85.4 % The increase in cost of sales, as a percent of sales, during 2025 was primarily due to (1) higher commodity costs, (2) a decrease in traffic and (3) an increase in restaurant labor rates.
Company-operated $ 2,275.1 $ 2,256.7 $ 2,192.0 U.S. franchised 2,085.7 2,046.0 1,957.2 U.S. systemwide 2,098.2 2,060.2 1,973.1 International systemwide (a) 1,576.9 1,585.3 1,526.5 Global systemwide (a) $ 2,009.6 $ 1,984.1 $ 1,905.8 _______________ (a) Excludes Argentina due to the impact of that country’s highly inflationary economy.
Company-operated $ 2,241.3 $ 2,275.1 $ 2,256.7 U.S. franchised 1,984.0 2,085.7 2,046.0 U.S. systemwide 2,001.3 2,098.2 2,060.2 International systemwide (a) 1,483.2 1,576.9 1,585.3 Global systemwide (a) $ 1,903.0 $ 2,009.6 $ 1,984.1 _______________ (a) Excludes Argentina due to the impact of that country’s highly inflationary economy.
Numerous countries have enacted the Organization of Economic Corporation and Development’s framework on a global minimum tax (referred to as “Pillar 2”), with the earliest effective date for taxable years beginning after December 31, 2023.
These impacts were partially offset by the tax effects of the Company’s foreign operations. Numerous countries have enacted the Organization of Economic Corporation and Development’s framework on a global minimum tax (referred to as “Pillar 2”), with the earliest effective date for taxable years beginning after December 31, 2023.
Impairment of Long-Lived Assets 2024 2023 2022 Amount Change Amount Change Amount Impairment of long-lived assets $ 9.7 $ 8.3 $ 1.4 $ (5.0) $ 6.4 The increase in impairment of long-lived assets during 2024 was primarily due to (1) the decision to close certain Company-operated restaurants and (2) the deterioration in operating performance of certain other Company-operated restaurants.
Impairment of Long-Lived Assets 2025 2024 2023 Amount Change Amount Change Amount Impairment of long-lived assets $ 12.1 $ 2.4 $ 9.7 $ 8.3 $ 1.4 The increase in impairment of long-lived assets during 2025 was primarily due to the deterioration in operating performance of certain Company-operated restaurants.
In addition, as of December 29, 2024, we have deferred tax assets for foreign net operating loss carryforwards of $2.6 million and state and local net operating loss carryforwards of $26.8 million that will begin to expire in 2025.
In addition, as of December 28, 2025, we have deferred tax assets for foreign net operating loss carryforwards of $0.4 million and state and local net operating loss carryforwards of $25.6 million that will begin to expire in 2025.
Franchise Rental Expense 2024 2023 2022 Amount Change Amount Change Amount Franchise rental expense $ 127.4 $ 2.0 $ 125.4 $ 1.3 $ 124.1 The increase in franchise rental expense during 2024 was primarily due to the impact of assigning certain leases to franchisees.
Franchise Rental Expense 2025 2024 2023 Amount Change Amount Change Amount Franchise rental expense $ 125.8 $ (1.6) $ 127.4 $ 2.0 $ 125.4 The decrease in franchise rental expense during 2025 was primarily due to the impact of assigning certain existing leases to franchisees.
Capital Expenditures In 2024, cash capital expenditures amounted to $94.4 million, primarily related to digital and technology investments and various other development-related projects.
Capital Expenditures In 2025, cash capital expenditures amounted to $101.9 million, primarily related to digital and technology investments and various other development-related projects.
System Optimization Gains, Net 2024 2023 2022 Amount Change Amount Change Amount System optimization gains, net $ 1.2 $ 0.3 $ 0.9 $ (5.9) $ 6.8 System optimization gains, net during 2024 were primarily comprised of gains on the sale of Company-operated restaurants. See Note 15 to the Consolidated Financial Statements contained in Item 8 herein for further discussion.
System optimization gains, net during 2024 were primarily comprised of gains on the sale of Company-operated restaurants. See Note 15 to the Consolidated Financial Statements contained in Item 8 herein for further discussion.
Other Income, Net 2024 2023 2022 Amount Change Amount Change Amount Other income, net $ 24.8 $ (4.8) $ 29.6 $ 19.2 $ 10.4 The decrease in other income, net during 2024 was primarily due to a decrease in interest income, reflecting lower balances of cash equivalents.
Other Income, Net 2025 2024 2023 Amount Change Amount Change Amount Other income, net $ 12.5 $ (12.3) $ 24.8 $ (4.8) $ 29.6 The decrease in other income, net during 2025 was primarily due to a decrease in interest income, reflecting lower balances of cash equivalents and lower interest rates.
Reorganization and Realignment Costs 2024 2023 2022 Amount Change Amount Change Amount Organizational Redesign Plan $ 8.4 $ (0.7) $ 9.1 $ 9.1 $ — Other reorganization and realignment plans 0.1 — 0.1 (0.6) 0.7 $ 8.5 $ (0.7) $ 9.2 $ 8.5 $ 0.7 During 2024 and 2023, the Company recognized costs under the Organizational Redesign Plan of $8.4 million and $9.1 million, respectively, which primarily included severance and related employee costs.
Reorganization and Realignment Costs 2025 2024 2023 Amount Change Amount Change Amount Organizational Redesign Plan $ (0.8) $ (9.2) $ 8.4 $ (0.7) $ 9.1 Other reorganization and realignment plans 0.5 0.4 0.1 — 0.1 $ (0.1) $ (8.6) $ 8.5 $ (0.7) $ 9.2 During 2025, the Company recognized costs under the Organizational Redesign Plan of $(0.8) million, which primarily included a reversal of a severance accrual as a result of a change in estimate.
Company-operated $ 898.9 $ 905.7 $ 882.7 U.S. franchised 11,654.9 11,379.6 10,811.7 U.S. systemwide 12,553.8 12,285.3 11,694.4 International Company-operated 27.0 24.4 13.9 International franchised (a) 1,906.6 1,778.0 1,592.4 International systemwide (a) 1,933.6 1,802.4 1,606.3 Global systemwide (a) $ 14,487.4 $ 14,087.7 $ 13,300.7 Restaurant average unit volumes (in thousands): U.S.
Company-operated $ 887.5 $ 898.9 $ 905.7 U.S. franchised 11,010.0 11,654.9 11,379.6 U.S. systemwide 11,897.5 12,553.8 12,285.3 International Company-operated 28.8 27.0 24.4 International franchised (a) 2,035.3 1,906.6 1,778.0 International systemwide (a) 2,064.1 1,933.6 1,802.4 Global systemwide (a) $ 13,961.6 $ 14,487.4 $ 14,087.7 Restaurant average unit volumes (in thousands): U.S.
Key Business Measures We track our results of operations and manage our business using the following key business measures, which include non-GAAP financial measures: • Same-Restaurant Sales - We report same-restaurant sales commencing after new restaurants have been open for 15 continuous months and as soon as reimaged restaurants reopen.
Key Business Measures We track our results of operations and manage our business using the following key business measures: • Same-Restaurant Sales - We report same-restaurant sales commencing after new restaurants have been open for 15 continuous months and as soon as reimaged restaurants reopen. Restaurants temporarily closed for more than one week are excluded from same-restaurant sales.
During 2024, the Company repurchased 4.3 million shares under the January 2023 Authorization with an aggregate purchase price of $75.0 million, excluding excise tax of $0.6 million and commissions of $0.1 million. As of December 29, 2024, the Company had $235.0 million of availability remaining under the January 2023 Authorization.
During 2025, the Company repurchased 14.4 million shares under the January 2023 Authorization with an aggregate purchase price of $200.0 million, excluding excise tax of $1.9 million and commissions of $0.2 million. As of December 28, 2025, the Company had $35.0 million of availability remaining under the January 2023 Authorization.
These impacts were partially offset by (1) an increase in restaurant labor rates and (2) a decrease in customer count. 41 Franchise Support and Other Costs 2024 2023 2022 Amount Change Amount Change Amount Franchise support and other costs $ 67.7 $ 10.5 $ 57.2 $ 10.5 $ 46.7 The increase in franchise support and other costs during 2024 was primarily due to (1) an increase in costs incurred to provide information technology and other services to franchisees and (2) an increase in the provision for doubtful accounts.
These changes were partially offset by (1) higher average check and (2) labor efficiencies. 40 Franchise Support and Other Costs 2025 2024 2023 Amount Change Amount Change Amount Franchise support and other costs $ 81.0 $ 13.3 $ 67.7 $ 10.5 $ 57.2 The increase in franchise support and other costs during 2025 was primarily due to (1) an increase in the provision for doubtful accounts and (2) an increase in costs incurred to provide information technology services and other services to franchisees.
Depreciation and Amortization (exclusive of amortization of cloud computing arrangements shown separately below) 2024 2023 2022 Amount Change Amount Change Amount Restaurants $ 87.4 $ 1.6 $ 85.8 $ 1.8 $ 84.0 Technology support, corporate and other 55.8 5.8 50.0 0.6 49.4 $ 143.2 $ 7.4 $ 135.8 $ 2.4 $ 133.4 The increase in depreciation and amortization during 2024 was primarily due to (1) depreciation and amortization for technology investments and (2) asset additions for new and remodeled restaurants. 42 Amortization of Cloud Computing Arrangements 2024 2023 2022 Amount Change Amount Change Amount Amortization of cloud computing arrangements $ 14.7 $ 1.9 $ 12.8 $ 10.4 $ 2.4 The increase in amortization of cloud computing arrangements was primarily due to amortization of assets associated with the Company’s HCM system implementation completed in 2023.
Depreciation and Amortization (exclusive of amortization of cloud computing arrangements shown separately below) 2025 2024 2023 Amount Change Amount Change Amount Restaurant properties $ 77.9 $ 4.4 $ 73.5 $ 3.8 $ 69.7 Finance lease assets 18.9 5.0 13.9 (2.2) 16.1 Technology support, corporate and other 55.4 (0.4) 55.8 5.8 50.0 $ 152.2 $ 9.0 $ 143.2 $ 7.4 $ 135.8 The increase in depreciation and amortization during 2025 was primarily due to (1) restaurant-related asset disposals and (2) asset additions for new and remodeled restaurants. 41 Amortization of Cloud Computing Arrangements 2025 2024 2023 Amount Change Amount Change Amount Amortization of cloud computing arrangements $ 18.6 $ 3.9 $ 14.7 $ 1.9 $ 12.8 The increase in amortization of cloud computing arrangements during 2025 was primarily due to amortization of assets associated with the Company’s digital investments.
In 2025, we expect that cash capital expenditures will amount to approximately $100.0 million to $110.0 million, principally relating to (1) technology investments, including consumer-facing digital technology, (2) the opening of new Company-operated restaurants, (3) land investments and (4) various other capital projects. 46 In addition to the capital expenditures noted above, cash expenditures related to the Company’s build to suit development fund amounted to $41.2 million during 2024.
In 2026, we expect that cash capital expenditures will amount to approximately $100.0 million to $110.0 million, principally relating to (1) technology investments, including consumer-facing digital technology, (2) the opening of new Company-operated restaurants and the reimaging of existing Company-operated restaurants, (3) maintenance capital expenditures for Company-operated restaurants and (4) various other capital projects.
Franchised International Company-operated International Franchised Systemwide Restaurant count: Restaurant count at January 1, 2023 403 5,591 12 1,089 7,095 Opened 3 94 1 150 248 Closed (3) (58) (1) (41) (103) Restaurant count at December 31, 2023 403 5,627 12 1,198 7,240 Opened 2 99 1 174 276 Closed (21) (177) — (78) (276) Net (sold to) purchased by franchisees (3) 3 — — — Restaurant count at December 29, 2024 381 5,552 13 1,294 7,240 40 Sales 2024 2023 2022 Amount Change Amount Change Amount Sales $ 925.9 $ (4.2) $ 930.1 $ 33.5 $ 896.6 The decrease in sales during 2024 was primarily due to (1) net closures of Company-operated restaurants of $3.1 million and (2) a 0.1% decrease in Company-operated same-restaurant sales of $2.4 million.
Franchised International Company-operated International Franchised Systemwide Restaurant count: Restaurant count at December 31, 2023 403 5,627 12 1,198 7,240 Opened 2 99 1 174 276 Closed (21) (177) — (78) (276) Net (sold to) purchased by franchisees (3) 3 — — — Restaurant count at December 29, 2024 381 5,552 13 1,294 7,240 Opened 14 95 1 158 268 Closed (2) (71) (3) (35) (111) Net purchased from (sold to) franchisees 30 (30) — — — Restaurant count at December 28, 2025 423 5,546 11 1,417 7,397 39 Sales 2025 2024 2023 Amount Change Amount Change Amount Sales $ 916.3 $ (9.6) $ 925.9 $ (4.2) $ 930.1 The decrease in sales during 2025 was primarily due to (1) a 2.5% decrease in Company-operated same-restaurant sales of $22.0 million and (2) the sale of Company-operated restaurants to franchisees of $6.9 million.
The revenues from our restaurant business are derived from two principal sources: (1) sales at Company-operated restaurants and (2) franchise-related revenues, including royalties, national advertising funds contributions, rents and franchise fees received from Wendy’s franchised restaurants. Company-operated restaurants comprised approximately 5% of the total Wendy’s system as of December 29, 2024.
Of the international restaurants, 1,417 were operated by a total of 117 franchisees and 11 were operated by the Company in the U.K. The revenues from our restaurant business are derived from two principal sources: (1) sales at Company-operated restaurants and (2) franchise-related revenues, including royalties, national advertising funds contributions, rents and franchise fees received from Wendy’s franchised restaurants.
Provision for Income Taxes 2024 2023 2022 Amount Change Amount Change Amount Income before income taxes $ 272.4 $ (7.0) $ 279.4 $ 35.9 $ 243.5 Provision for income taxes (78.0) (3.0) (75.0) (8.9) (66.1) Effective tax rate on income 28.7 % 1.9 % 26.8 % (0.4) % 27.2 % The increase in the provision for income taxes and the effective tax rate during 2024 was primarily due to a discrete state tax item.
Provision for Income Taxes 2025 2024 2023 Amount Change Amount Change Amount Income before income taxes $ 227.2 $ (45.2) $ 272.4 $ (7.0) $ 279.4 Provision for income taxes (62.1) 15.9 (78.0) (3.0) (75.0) Effective tax rate on income 27.4 % (1.3) % 28.7 % 1.9 % 26.8 % The decrease in the provision for income taxes and the effective tax rate during 2025 was primarily due to (1) an unfavorable discrete state tax item in the prior year and (2) the tax effects of share-based compensation.
Franchise Rental Income 2024 2023 2022 Amount Change Amount Change Amount Franchise rental income $ 236.5 $ 6.3 $ 230.2 $ (4.3) $ 234.5 The increase in franchise rental income during 2024 was primarily due to the impact of (1) amending certain existing leases of $4.0 million and (2) entering into new leases of $2.2 million.
Franchise Rental Income 2025 2024 2023 Amount Change Amount Change Amount Franchise rental income $ 235.8 $ (0.7) $ 236.5 $ 6.3 $ 230.2 The decrease in franchise rental income during 2025 was primarily due to (1) the impact of assigning certain existing leases to franchisees of $5.6 million.
Franchise Royalty Revenue and Fees 2024 2023 2022 Amount Change Amount Change Amount Franchise royalty revenue $ 528.4 $ 16.3 $ 512.1 $ 26.6 $ 485.5 Franchise fees 97.6 17.4 80.2 7.5 72.7 $ 626.0 $ 33.7 $ 592.3 $ 34.1 $ 558.2 Franchise royalty revenue during 2024 increased $16.3 million, of which (1) $9.3 million was due to a 1.7% increase in global franchise same-restaurant sales and (2) $8.3 million was due to net new restaurant development.
Franchise Royalty Revenue and Fees 2025 2024 2023 Amount Change Amount Change Amount Franchise royalty revenue $ 504.5 $ (23.9) $ 528.4 $ 16.3 $ 512.1 Franchise fees 98.2 0.6 97.6 17.4 80.2 $ 602.7 $ (23.3) $ 626.0 $ 33.7 $ 592.3 The decrease in franchise royalty revenue during 2025 was primarily due to a 4.8% decrease in global franchise same-restaurant sales.
Liquidity and Capital Resources Our primary sources of liquidity and capital resources are cash flows from operations and borrowings under our securitized financing facility. Our principal uses of cash are operating expenses, repurchases of common stock, dividends to stockholders and capital expenditures. As of December 29, 2024, cash, cash equivalents and restricted cash totaled $503.6 million.
These increases were partially offset by lower revenues. Liquidity and Capital Resources Our primary sources of liquidity and capital resources are cash flows from operations and borrowings under our securitized financing facility. Our principal uses of cash are operating expenses, repurchases of common stock, capital expenditures and dividends to stockholders.
Other Operating Income, Net 2024 2023 2022 Amount Change Amount Change Amount Gains on sales-type leases $ 0.5 $ (2.0) $ 2.5 $ (0.5) $ 3.0 Lease buyout (1.0) (0.9) (0.1) (2.9) 2.8 Equity in earnings in joint ventures, net 11.6 0.8 10.8 1.4 9.4 Gain from insurance recoveries — — — (8.6) 8.6 Other, net 0.3 (0.3) 0.6 0.7 (0.1) $ 11.4 $ (2.4) $ 13.8 $ 9.9 $ 23.7 The decrease in other operating income, net during 2024 was primarily due to prior year gains on new and modified sales-type leases.
Other Operating Income, Net 2025 2024 2023 Amount Change Amount Change Amount Lease buyout $ 4.0 $ 5.0 $ (1.0) $ (0.9) $ (0.1) Claim settlement 4.0 4.0 — — — Gains on sales-type leases 2.9 2.4 0.5 (2.0) 2.5 Other, net 11.3 (0.6) 11.9 0.5 11.4 $ 22.2 $ 10.8 $ 11.4 $ 2.4 $ 13.8 The increase in other operating income, net during 2025 was primarily due to (1) an increase in lease buyout activity, (2) the settlement of a claim and (3) gains on new and modified sales-type leases.
These increases were partially offset by a decrease in Company-operated sales driven by the same factors as described above for “Sales.” The decrease in Wendy’s U.S. segment profit during 2024 was primarily due to (1) an increase in the Company’s funding of incremental advertising, (2) a decrease in Company-operated sales and (3) higher franchise support and other costs.
The decrease in Wendy’s U.S. segment profit during 2025 was primarily due to (1) lower revenues, (2) higher cost of sales, as a percent of sales for Company-operated restaurants driven by the same factors as described above for “Cost of Sales, as a Percent of Sales” and (3) higher franchise support and other costs.
Wendy’s U.S. 2024 2023 2022 Amount Change Amount Change Amount Sales $ 898.9 $ (6.8) $ 905.7 $ 23.0 $ 882.7 Franchise royalty revenue 456.6 11.9 444.7 20.7 424.0 Franchise fees 82.7 14.0 68.7 5.7 63.0 Advertising fund revenue 421.5 24.8 396.7 16.2 380.5 Total revenues $ 1,859.7 $ 43.9 $ 1,815.8 $ 65.6 $ 1,750.2 Segment profit $ 526.0 $ (2.4) $ 528.4 $ 47.9 $ 480.5 44 The increase in Wendy’s U.S. revenues during 2024 was primarily due to (1) higher advertising fund revenue, (2) an increase in franchisee fees, (3) an increase in franchise same-restaurant sales and (4) restaurant development activity.
Wendy’s U.S. 2025 2024 2023 Amount Change Amount Change Amount Sales $ 887.5 $ (11.4) $ 898.9 $ (6.8) $ 905.7 Franchise royalty revenue 429.0 (27.6) 456.6 11.9 444.7 Franchise fees 84.1 1.4 82.7 14.0 68.7 Advertising fund revenue 384.5 (37.0) 421.5 24.8 396.7 Total revenues $ 1,785.1 $ (74.6) $ 1,859.7 $ 43.9 $ 1,815.8 Segment profit $ 489.1 $ (36.9) $ 526.0 $ (2.4) $ 528.4 43 The decrease in Wendy’s U.S. revenues during 2025 was primarily due to (1) lower advertising fund revenue and (2) a decrease in same-restaurant sales.
Advertising Funds Expense 2024 2023 2022 Amount Change Amount Change Amount Advertising funds expense $ 478.1 $ 50.1 $ 428.0 $ (2.8) $ 430.8 The increase in advertising funds expense during 2024 was primarily due to (1) the same factors as described above for “Advertising Funds Revenue” and (2) the recognition of the expected Company breakfast advertising spend in excess of advertising funds revenue of $21.9 million.
Advertising Funds Expense 2025 2024 2023 Amount Change Amount Change Amount Advertising funds expense $ 422.6 $ (55.5) $ 478.1 $ 50.1 $ 428.0 The decrease in advertising funds expense during 2025 was primarily due to (1) the same factors as described above for “Advertising Funds Revenue” and (2) a decrease in the Company’s funding of incremental breakfast advertising.
Of the U.S. restaurants, 381 were operated by the Company and 5,552 were operated by a total of 207 franchisees. In addition, at December 29, 2024, there were 1,307 Wendy’s restaurants in operation in 31 foreign countries and U.S. territories. Of the international restaurants, 1,294 were operated by 107 franchisees and 13 were operated by the Company in the U.K.
Of the U.S. restaurants, 423 were operated by the Company and 5,546 were operated by a total of 203 franchisees. In addition, at December 28, 2025, there were 1,428 Wendy’s restaurants in operation in 38 foreign countries and U.S. territories.
General and Administrative 2024 2023 2022 Amount Change Amount Change Amount Employee compensation and benefits $ 135.1 $ 8.7 $ 126.4 $ (2.1) $ 128.5 Professional fees 58.0 (2.3) 60.3 (1.5) 61.8 Incentive compensation 25.6 (1.2) 26.8 1.8 25.0 Share-based compensation 22.2 (0.3) 22.5 (2.0) 24.5 Other, net 14.3 0.3 14.0 (1.2) 15.2 $ 255.2 $ 5.2 $ 250.0 $ (5.0) $ 255.0 The increase in general and administrative expenses during 2024 was primarily due to higher employee compensation and benefits.
General and Administrative 2025 2024 2023 Amount Change Amount Change Amount Share-based compensation $ 14.2 $ (8.0) $ 22.2 $ (0.3) $ 22.5 Incentive compensation 19.9 (5.7) 25.6 (1.2) 26.8 Professional fees 56.3 (1.7) 58.0 (2.3) 60.3 Employee compensation and benefits 147.4 12.3 135.1 8.7 126.4 Other, net 14.9 0.6 14.3 0.3 14.0 $ 252.7 $ (2.5) $ 255.2 $ 5.2 $ 250.0 The decrease in general and administrative expenses during 2025 was primarily due to (1) lower share-based compensation as a result of the departure of the Company’s previous President and Chief Executive Officer and (2) a decrease in incentive compensation accruals, reflecting lower operating performance as compared to plan in 2025 versus 2024.
Global Real Estate & Development 2024 2023 2022 Amount Change Amount Change Amount Franchise fees $ 5.6 $ 0.6 $ 5.0 $ 0.9 $ 4.1 Franchise rental income 236.5 6.3 230.2 (4.3) 234.5 Total revenues $ 242.1 $ 6.9 $ 235.2 $ (3.4) $ 238.6 Segment profit $ 108.6 $ 5.1 $ 103.5 $ (5.2) $ 108.7 The increase in Global Real Estate & Development revenues during 2024 was primarily due to higher franchise rental income as a result of (1) amending certain existing leases and (2) entering into new leases.
Global Real Estate & Development 2025 2024 2023 Amount Change Amount Change Amount Franchise fees $ 3.0 $ (2.6) $ 5.6 $ 0.6 $ 5.0 Franchise rental income 235.8 (0.7) 236.5 6.3 230.2 Total revenues $ 238.8 $ (3.3) $ 242.1 $ 6.9 $ 235.2 Segment profit $ 110.4 $ 1.8 $ 108.6 $ 5.1 $ 103.5 The decrease in Global Real Estate & Development revenues during 2025 was primarily due to (1) lower development-related fees and (2) lower franchise rental income, driven by the same factors as described above for “Franchise Rental Income.” The increase in Global Real Estate & Development segment profit during 2025 was primarily due to (1) gains on new and modified sales-type leases and (2) an increase in lease buyout activity.
Advertising Funds Revenue 2024 2023 2022 Amount Change Amount Change Amount Advertising funds revenue $ 458.1 $ 29.1 $ 429.0 $ 22.8 $ 406.2 The increase in advertising funds revenue during 2024 was primarily due to (1) promotional activity of $12.0 million, (2) an increase in franchise same-restaurant sales in the U.S. and Canada of $6.9 million and (3) net new restaurant development of $5.6 million.
Advertising Funds Revenue 2025 2024 2023 Amount Change Amount Change Amount Advertising funds revenue $ 422.1 $ (36.0) $ 458.1 $ 29.1 $ 429.0 The decrease in advertising funds revenue during 2025 was primarily due to (1) a decrease in franchise same-restaurant sales of $23.0 million and (2) promotional activity in the prior year of $12.0 million.
Off-Balance Sheet Arrangements Other than the obligations for guarantees described above in “Guarantees and Other Contingencies,” we do not have any off-balance sheet arrangements that have, or are, in the opinion of management, reasonably likely to have, a current or future material effect on our financial condition or results of operations. 48 Critical Accounting Policies and Estimates The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions in applying our critical accounting policies that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses during the reporting period.
Critical Accounting Policies and Estimates The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions in applying our critical accounting policies that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses during the reporting period.
The table summarizing same-restaurant sales below in “Results of Operations” provides the same-restaurant sales percent changes. • Company-Operated Restaurant Margin - We define Company-operated restaurant margin as sales from Company-operated restaurants less cost of sales divided by sales from Company-operated restaurants. Cost of sales includes food and paper, restaurant labor and occupancy, advertising and other operating costs.
This methodology is consistent with the metric used by our management for internal reporting and analysis. The table summarizing same-restaurant sales below in “Results of Operations” provides the same-restaurant sales percent changes. • Company-Operated Restaurant Margin - We define Company-operated restaurant margin as sales from Company-operated restaurants less cost of sales divided by sales from Company-operated restaurants.
Dividends On March 15, 2024, June 17, 2024, September 17, 2024 and December 16, 2024, the Company paid quarterly cash dividends per share of $.25, aggregating $204.4 million. On February 13, 2025, the Company announced a dividend of $.25 per share to be paid on March 17, 2025 to stockholders of record as of March 3, 2025.
Dividends On March 17, 2025, June 16, 2025, September 16, 2025 and December 15, 2025, the Company paid quarterly cash dividends per share of $.25, $.14, $.14 and $.14, respectively, aggregating $129.6 million.
Franchise same-restaurant sales increased during 2024 due to higher average check, partially offset by a decrease in customer count. The increase in Wendy’s International segment profit during 2024 was primarily due to higher revenues, partially offset by higher franchise support and other costs.
Franchise same-restaurant sales increased during 2025 due to higher average check, partially offset by a decrease in traffic. Wendy’s International segment profit was relatively flat in 2025 compared with 2024. During 2025, higher general and administrative expense and higher advertising fund expense were largely offset by higher revenues.
We attempt to manage any inflationary costs and commodity price increases through selective menu price increases, product mix and focused execution of operational excellence. Delays in implementing such menu price increases and competitive pressures may limit our ability to recover such cost increases in the future.
Delays in implementing such menu price increases and competitive pressures may limit our ability to recover such cost increases in the future.
In 2025, we expect to invest approximately $70.0 million in the development fund to drive new restaurant growth. Long-Term Debt, Including Current Portion As of December 29, 2024, the Company’s long-term debt obligations totaled $2,740.3 million, including $78.2 million payable within 12 months.
Long-Term Debt, Including Current Portion As of December 28, 2025, the Company’s long-term debt obligations totaled $2,760.3 million, including $29.8 million payable within 12 months.
The increase in franchise fees during 2024 was primarily due to (1) early termination fees for franchised restaurant closures of $8.2 million, (2) higher fees for providing information technology services to franchisees of $4.7 million and (3) an increase in other miscellaneous fees of $4.5 million.
Franchise same-restaurant sales during 2025 decreased due to a decrease in traffic, partially offset by higher average check. The increase in franchise fees during 2025 was primarily due to (1) higher fees for providing information technology services to franchisees of $6.9 million and (2) an increase in other miscellaneous fees of $1.9 million.
See Note 16 to the Consolidated Financial Statements contained in Item 8 herein for further information on the Organizational Redesign Plan.
During 2024, the Company recognized costs under the Organizational Redesign Plan of $8.4 million, which primarily included severance and related employee costs. See Note 17 to the Consolidated Financial Statements contained in Item 8 herein for further information on the Organizational Redesign Plan.
We currently believe we have the ability to pursue additional sources of liquidity if needed or desired to fund operating cash requirements or for other purposes. However, there can be no assurance that additional liquidity will be readily available or available on terms acceptable to us.
Based on current levels of operations, the Company expects that available cash and cash flows from operations will provide sufficient liquidity to meet operating cash requirements for the next 12 months. 44 We currently believe we have the ability to pursue additional sources of liquidity if needed or desired to fund operating cash requirements or for other purposes.
Franchise same-restaurant sales increased during 2024 primarily due to higher average check, partially offset by a decrease in customer count.
Same-restaurant sales decreased during 2025 primarily due to a decrease in traffic, partially offset by higher average check. These changes were partially offset by the Company’s acquisition of 35 franchise-operated restaurants.
Whether or not to repurchase any debt and the size and timing of any such repurchases will be determined at our discretion. See Note 9 to the Consolidated Financial Statements contained in Item 8 herein for further information related to our long-term debt obligations and the timing of expected payments.
Whether or not to repurchase any debt and the size and timing of any such repurchases will be determined at our discretion.
The change was primarily due to (1) an increase in expenditures associated with the Company’s franchise development fund of $33.3 million and (2) an increase in capital expenditures of $9.4 million. Financing Activities Cash used in financing activities was $303.1 million and $504.3 million in 2024 and 2023, respectively.
Financing Activities Cash used in financing activities was $344.0 million and $303.1 million in 2025 and 2024, respectively. The change was primarily due to (1) an increase in repurchases of the Company’s common stock of $123.4 million and (2) a decrease in proceeds from stock option exercises of $30.9 million.
Wendy’s operating results are impacted by a number of external factors, including commodity costs, labor costs, intense price competition, unemployment and consumer spending levels, general economic and market trends and weather. 34 Wendy’s strategic framework includes providing fresh, famous food to consumers, delivering an exceptional customer experience through operational excellence and expanding the Company’s footprint across the globe.
Wendy’s operating results are impacted by a number of external factors, including commodity costs, labor costs, intense price competition, unemployment and consumer spending levels, general economic and market trends and weather. 34 During 2025, the Company announced Project Fresh , a comprehensive plan to drive profitable growth and long-term value across our U.S. system.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeCommodity Price Risk We purchase certain food products, such as beef, chicken, eggs, pork, cheese and grains, that are affected by changes in commodity prices and, as a result, we are subject to variability in our food costs.
Biggest changeSee Note 9 to the Consolidated Financial Statements contained in Item 8 herein for further information on the Company’s debt structure and its securitized financing facility. 50 Commodity Price Risk We purchase certain food products, such as beef, chicken, eggs, pork, dairy and grains, that are affected by changes in commodity prices and, as a result, we are subject to variability in our food costs.
The Company could be exposed to interest rate increases under its Class A-1 Notes, its U.S. advertising fund revolving line of credit and certain other lines of credit; however, the Company had no outstanding borrowings under the Class A-1 Notes or such other lines of credit as of December 29, 2024.
The Company could be exposed to interest rate increases under its Class A-1 Notes, its U.S. advertising fund revolving line of credit and certain other lines of credit; however, the Company had no outstanding borrowings under the Class A-1 Notes or such other lines of credit as of December 28, 2025.
The exposure to Canadian dollar exchange rates on the Company’s cash flows primarily includes imports paid for by Canadian operations in U.S. dollars and payments from the Company’s Canadian operations to the Company’s U.S. operations in U.S. dollars. Revenues from our Canadian operations for the year ended December 29, 2024 represented approximately 5% of our total revenues.
The exposure to Canadian dollar exchange rates on the Company’s cash flows primarily includes imports paid for by Canadian operations in U.S. dollars and payments from the Company’s Canadian operations to the Company’s U.S. operations in U.S. dollars. Revenues from our Canadian operations for the year ended December 28, 2025 represented approximately 5% of our total revenues.
Interest Rate Risk Our objective in managing our exposure to interest rate changes is to limit the impact on our earnings and cash flows. Our policies prohibit the use of derivative instruments for trading purposes, and we had no outstanding derivative instruments as of December 29, 2024.
Interest Rate Risk Our objective in managing our exposure to interest rate changes is to limit the impact on our earnings and cash flows. Our policies prohibit the use of derivative instruments for trading purposes and we had no outstanding derivative instruments as of December 28, 2025.
An immediate 10% change in Canadian dollar exchange rates versus the U.S. dollar from their levels at December 29, 2024 would not have a material effect on our consolidated financial position or results of operations. 52
An immediate 10% change in Canadian dollar exchange rates versus the U.S. dollar from their levels at December 28, 2025 would not have a material effect on our consolidated financial position or results of operations. 51
Our long-term debt, including the current portion, aggregated $2,767.6 million as of December 29, 2024 (excluding unamortized debt issuance costs and the effect of purchase accounting adjustments). The Company’s predominantly fixed-rate debt structure has reduced its exposure to interest rate increases that could adversely affect its earnings and cash flows.
Our long-term debt, including the current portion, aggregated $2,789.2 million as of December 28, 2025 (excluding unamortized debt issuance costs). The Company’s predominantly fixed-rate debt structure has reduced its exposure to interest rate increases that could adversely affect its earnings and cash flows.
Removed
See Note 9 to the Consolidated Financial Statements contained in Item 8 herein for further information on the Company’s debt structure and its securitized financing facility.

Other WEN 10-K year-over-year comparisons