Restaurant Brands International Posts Strong Earnings Despite Staff Shortage

Restaurant Brands International Posts Strong Earnings Despite Staff Shortage

Restaurant Brands International (NYSE: QSR), parent company to Burger King, Tim Hortons, and Popeyes, reported better-than-expected quarterly earnings on Monday. Nevertheless, the company’s revenue did not meet expectations as continuous labor shortages impacted sales. Shares tumbled 3% on Monday morning upon the news.

The multinational fast food holding company reported earnings of USD0.76 per share, compared to the expected USD0.74 a share. Revenue amounted to USD1.5 Billion, slightly short of analysts anticipated USD1.52 Billion.

According to the company, Covid-19 is a strong factor in labor issues. The challenges caused several restaurants in particular regions to cut hours or decrease service modes. CEO Jose Cil revealed that approximately 40% of Popeyes restaurants have been forced to temporarily close their dining rooms due to staffing issues.

Restaurant Brands International has also faced strong competition from rivals McDonald’s Corp and Wendy’s Co. as they ramp up marketing and introduce new items to their menus. Wendy’s added a new ‘Big Bacon Cheddar Cheeseburger’ to its menu, while McDonald’s partnered with boy band BTS and rapper Sweetie to attract consumers.

“We saw a continued gap relative to our peers. We’re keenly aware of this gap,” Chief Executive Jose Cil told analysts while discussing Burger King’s results. “We also see clear opportunities across operations, digital, menu, and image that can work together to reclaim market share.”

Analysts highlighted that Burger King’s marketing had fallen flat. Nevertheless, they continued on to say that Burger King had potential and could experience a revival, similar to that of Domino’s Pizza in 2010.

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