Pizza Hut will be getting $130 million investment in primarily improving tech at the chain, said YUM CFO David Gibbs Tuesday, June 20, while speaking at a conference hosted by Oppenheimer. Gibbs said the Pizza Hut turnaround will likely be "more of a slow build," compared to KFC, which saw speedy improvement after the investment was made.
"Pizza Hut has digital and technology challenges that KFC didn't really face," Gibbs said. "Implementing new technology obviously takes time...no one is saying this is an overnight thing."
Over three years, Yum had sunk $185 million to pump up KFC, which is a steady driver of growth for Yum. Through the investment, Yum renovated some 3,000 struggling KFC restaurants and brought back the image of Colonel Sanders, KFC's founder, leading to consistently strong same-store sales growth at the fried-chicken chain.
Gibbs said Yum is focused on transforming Pizza Hut's online ordering capabilities, which historically have lagged those of competitors Domino's Pizza Inc. (DPZ) - Get Report and Papa John's Int.'l Inc. (PZZA) - Get Report . Plus, Yum will also transform certain dine-in Pizza Hut locations into delivery hubs or fast-casual restaurants.
In its most-recent first quarter, Yum saw a 7% dive in same-store sales at Pizza Hut, while at Taco Bell and KFC, comparable store sales rose 8% and 2%, respectively. In April, KeyBanc analyst Chris O'Cull revealed that Pizza Hut's share of the fast-food pizza market was dwindling.
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