Wendy’s expands China footprint with 1,000-store deal amid global sales slump

Wendy’s (NASDAQ:WEN) is doubling down on its international growth strategy to offset a challenging domestic environment, announcing a landmark franchise agreement in China alongside its first-quarter 2026 financial results.

The Dublin, Ohio-based hamburger chain reported global systemwide sales of $3.22 billion for the quarter, representing a 5.5% decrease compared to the prior-year period.

Despite the contraction in total system sales, the company’s international segment provided a bright spot, with sales rising 6% year-over-year.

To capitalize on this global momentum, Wendy’s finalized a massive development deal to open up to 1,000 new restaurants in China over the coming years.

This move marks a pivotal shift in the company’s geographic footprint as it seeks to compete more aggressively with larger rivals in the world’s second-largest economy.

For the quarter ended March 31, 2026, Wendy’s reported net income of $22.7 million and diluted earnings per share (EPS) of $0.12.

Adjusted EBITDA for the period stood at $111.3 million, reflecting the impact of higher labor and commodity costs that continue to pressure margins across the quick-service restaurant industry.

The company remains committed to its capital return program, declaring a quarterly dividend of $0.14 per share, payable on June 15, 2026, to shareholders of record as of June 1.

This consistent payout underscores the company’s stable cash flow position, even as it directs significant capital toward its digital transformation and international store build-outs.

Meanwhile, management reaffirmed its full-year 2026 outlook, signaling confidence that the international expansion and domestic value platforms will stabilize performance in the latter half of the year.

The company continues to project adjusted EBITDA between $460 million and $480 million, with adjusted EPS expected to fall in the range of $0.56 to $0.60.