Yum! Beats, Guides Quarters Lower

The restaurant operator sees third-quarter earnings of 70 cents a share.
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Yum! Brands'

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second-quarter earnings jumped 5% from a year ago, boosted by moderately higher sales and a lower income tax expense. Per-share earnings were well ahead of estimates, but the company issued earnings guidance for the next two quarters that trails Wall Street estimates.

Yum! earned $187 million, or 62 cents a share, in the quarter, compared with $178 million, or 58 cents a share, a year ago. Revenue rose 4% from a year ago to $2.15 billion. Analysts had been forecasting earnings of 57 cents a share on revenue of $2.15 billion.

For the third quarter, Yum! expects to earn 70 cents a share, while for the fourth quarter, the company expects to earn 77 cents a share. Analysts were forecasting 71 cents a share in the third quarter and 82 cents a share in the fourth quarter. The company said "facility action expenses" and an unfavorable tax rate would hurt the fourth quarter.

The company expects to earn $2.62 a share in the full year, an in-line estimate that looks primarily attributable to the second-quarter upside. The company's previous full-year guidance was $2.60 a share.