v3.26.1
Segment Reporting
 6 Months Ended
Jun. 30, 2026
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
As stated in Note 1, Description of Business and Organization, we manage four brands: Tim Hortons, Burger King, Popeyes, and Firehouse Subs.
Our management structure and information regularly reviewed by our Chief Executive Officer, who is our Chief Operating Decision Maker (“CODM”), reflects six operating and reportable segments. The reportable segments consist of the following:
1.Tim Hortons – Operations of our Tim Hortons brand in Canada and the U.S. (“TH”);
2.Burger King – Operations of our Burger King brand in the U.S. and Canada, excluding results of Burger King restaurants acquired as part of our acquisition of Carrols Restaurant Group Inc. (the “Carrols Acquisition”) (“BK”);
3.Popeyes Louisiana Kitchen – Operations of our Popeyes brand in the U.S. and Canada (“PLK”);
4.Firehouse Subs – Operations of our Firehouse Subs brand in the U.S. and Canada (“FHS”);
5.International – Operations of each of our brands outside the U.S. and Canada, excluding results of restaurants acquired as part of our acquisition of Popeyes China (“PLK China”) (“PLK China Acquisition”) and Firehouse Subs Brazil (“FHS Brazil”) restaurants (“INTL”); and
6.Restaurant Holdings – Operations of Burger King restaurants acquired as part of the Carrols Acquisition and the operations of PLK China and FHS Brazil restaurants (“RH”).
Following the establishment of a joint venture with CPE Alder Investment Limited with respect to the operations of BK China (the “BK China JV”), during the first quarter of 2026, we resumed recognizing franchise revenue from the BK China JV within our INTL segment. We refer to the acquisition of BK China and the subsequent establishment of the BK China JV collectively as the “BK China Transactions.” See Note 5, BK China, for additional information.
Our measure of segment income is Adjusted Operating Income. Our chief operating decision maker uses Adjusted Operating Income (i) in the budgeting process and in periodic reviews of segment performance by comparing variances in actual segment income results to budget and (ii) during the annual budgeting process to make capital allocation decisions, including allocating resources to segments.
Adjusted Operating Income represents income from operations adjusted to exclude (i) franchise agreement and reacquired franchise right intangible asset amortization as a result of acquisition accounting, (ii) (income) loss from equity method investments, net of cash distributions received from equity method investments, (iii) other operating expenses (income), net, and (iv) expenses from non-recurring projects and non-operating activities. For the periods referenced, expenses from non-recurring projects and non-operating activities included (i) non-recurring fees and expenses, consisting primarily of professional fees, compensation-related expenses, and integration costs, incurred in connection with (a) the Carrols Acquisition, the PLK China Acquisition, and the BK China Transactions, and (b) the anticipated refranchising of restaurants held in the RH segment, primarily those acquired in the Carrols Acquisition, in connection with the planned sunset of the RH segment (“RH and BK China Transaction costs”); and (ii) non-operating costs from professional advisory and consulting services associated with certain transformational corporate restructuring initiatives that rationalize our structure and optimize cash movements as well as services related to significant tax reform legislation and regulations (“Corporate restructuring and advisory fees”).
The following tables present total segment revenues, significant segment expenses that are regularly reviewed by the CODM to manage and assess segment performance and segment income, as well as depreciation and amortization, (income) loss from equity method investments, and capital expenditures by segment (in millions). For the periods referenced, segment franchise and property expenses (“Segment F&P expenses”) for each segment exclude franchise agreement and reacquired franchise rights amortization and Segment G&A for each segment excludes RH and BK China Transaction costs, and Corporate restructuring and advisory fees. For segment reporting purposes, capital expenditures include payments for additions of property and equipment during the period, as well as the change in accruals for additions of property and equipment since the prior period. Totals in the following tables may not calculate exactly due to rounding.
Three Months Ended June 30, 2026
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$1,137 $342 $199 $62 $274 $506 $— $2,520 
Intersegment revenues (a)— 54 — — — — (55)— 
Total revenues$1,137 $397 $199 $62 $274 $506 $(55)$2,520 
Operating costs and expenses:
Supply chain cost of sales$635 $— $— $— $— $— $— $635 
Company restaurant expenses (b)9 39 41 10 — 435 (27)508 
Segment F&P expenses86 33 3 2 3 — (3)123 
Advertising expenses and other services90 156 74 21 24 27 (24)369 
Segment G&A34 31 18 12 52 27 — 175 
Adjustments:
Cash distributions received from equity method investments4 — — — — — — 4 
Adjusted Operating Income$287 $137 $63 $17 $194 $17 $— $715 
Additional segment information:
Depreciation and amortization$27 $12 $4 $1 $7 $26 $— $77 
(Income) loss from equity method investments$(4)$— $— $— $2 $— $— $(2)
Capital expenditures$9 $4 $4 $1 $2 $21 $— $42 
(a)Consists of BK and INTL royalties, property, advertising, and other services revenues from intersegment transactions with RH.
(b)The components of Company restaurant expenses for our RH segment are included below.
Six Months Ended June 30, 2026
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$2,134 $659 $389 $121 $527 $953 $— $4,784 
Intersegment revenues (a)— 102 — — 1 — (103)— 
Total revenues$2,134 $762 $389 $121 $528 $953 $(103)$4,784 
Operating costs and expenses:
Supply chain cost of sales$1,199 $— $— $— $— $— $— $1,199 
Company restaurant expenses (b)18 82 79 20 — 836 (51)985 
Segment F&P expenses168 66 6 4 (11)— (7)226 
Advertising expenses and other services172 297 148 42 46 50 (45)710 
Segment G&A68 64 36 25 103 51 — 347 
Adjustments:
Cash distributions received from equity method investments7 — — — — — — 7 
Adjusted Operating Income$516 $252 $119 $31 $390 $16 $— $1,324 
Additional segment information:
Depreciation and amortization$54 $24 $7 $3 $15 $53 $— $155 
(Income) loss from equity method investments$(7)$— $— $— $4 $— $— $(4)
Capital expenditures$14 $9 $7 $2 $5 $37 $— $75 
Three Months Ended June 30, 2025
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$1,083 $338 $210 $59 $250 $469 $— $2,410 
Intersegment revenues (a)— 49 — — — — (49)— 
Total revenues$1,083 $388 $210 $59 $250 $469 $(49)$2,410 
Operating costs and expenses:
Supply chain cost of sales$589 $— $— $— $— $— $— $589 
Company restaurant expenses (b)10 57 40 9 — 406 (23)498 
Segment F&P expenses83 33 6 2 9 — (4)128 
Advertising expenses and other services93 147 80 20 23 24 (22)364 
Segment G&A34 31 19 13 47 23 — 166 
Adjustments:
Cash distributions received from equity method investments4 — — — — — — 4 
Adjusted Operating Income$278 $121 $66 $15 $172 $16 $— $668 
Additional segment information:
Depreciation and amortization$28 $13 $4 $1 $7 $24 $— $77 
(Income) loss from equity method investments$(4)$— $— $— $(1)$— $— $(5)
Capital expenditures$9 $6 $2 $1 $4 $21 $— $42 
Six Months Ended June 30, 2025
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$1,987 $647 $404 $113 $468 $901 $— $4,519 
Intersegment revenues (a)— 97 — — — — (97)— 
Total revenues$1,987 $744 $404 $113 $468 $901 $(97)$4,519 
Operating costs and expenses:
Supply chain cost of sales$1,085 $— $— $— $— $— $— $1,085 
Company restaurant expenses (b)19 111 79 19 — 785 (47)966 
Segment F&P expenses161 64 8 3 14 — (8)242 
Advertising expenses and other services159 278 152 38 45 45 (42)675 
Segment G&A71 67 40 27 98 48 — 351 
Adjustments:
Cash distributions received from equity method investments7 — — — — — — 7 
Adjusted Operating Income$499 $224 $126 $26 $310 $23 $— $1,208 
Additional segment information:
Depreciation and amortization$55 $26 $7 $3 $14 $44 $— $148 
(Income) loss from equity method investments$(7)$— $— $— $(3)$— $— $(10)
Capital expenditures$13 $11 $3 $2 $6 $37 $— $73 
The following table presents the components of Company restaurant expenses for our RH segment (in millions):
Three Months Ended
June 30,		Six Months Ended
June 30,
2026202520262025
Company restaurant expenses for RH segment
Food, beverage, and packaging costs$154 $134 $287 $255 
Restaurant wages and related expenses154 152 300 297 
Restaurant occupancy expense and other128 120 250 233 
             Total$435 $406 $836 $785 
The following tables present revenues by country (in millions):
Three Months Ended
June 30,		Six Months Ended
June 30,
2026202520262025
Revenues by country (c):
     United States$1,197 $1,165 $2,296 $2,238 
     Canada1,037 992 1,939 1,807 
     Other286 253 549 474 
Total$2,520 $2,410 $4,784 $4,519 
(c)Only the United States and Canada represented 10% or more of our total revenues in each period presented.
Our CODM manages assets on a consolidated basis. Accordingly, segment assets are not reported to our CODM or used in his decisions to allocate resources or assess performance of the segments. Therefore, total segment assets and long-lived assets have not been disclosed.
Adjusted Operating Income is used by management to measure operating performance of the business, excluding these non-cash and other specifically identified items that management believes are not relevant to management’s assessment of our operating performance. A reconciliation of Income from operations to Adjusted Operating Income consists of the following (in millions):

Three Months Ended
June 30,		Six Months Ended
June 30,
2026202520262025
Income from operations$716 $483 $1,322 $918 
Franchise agreement and reacquired franchise rights amortization16 17 32 33 
RH and BK China Transaction costs3 16 9 22 
Corporate restructuring and advisory fees2 5 4 6 
Impact of equity method investments (a)3 (1)4 (3)
Other operating expenses (income), net(26)149 (47)232 
Adjusted Operating Income $715 $668 $1,324 $1,208 
(a)Represents (i) (income) loss from equity method investments and (ii) cash distributions received from our equity method investments. Cash distributions received from our equity method investments are included in segment income.