v3.26.3
Segment Reporting
 9 Months Ended
Sep. 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 BK China (the “BK China JV”), during the first quarter of 2026, we resumed recognizing franchise revenue from the BK China JV in 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 September 30, 2026
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$1,136 $345 $204 $65 $289 $487 $— $2,525 
Intersegment revenues (a)— 51 — — 1 — (52)— 
Total revenues$1,136 $396 $204 $65 $289 $487 $(52)$2,525 
Operating costs and expenses:
Supply chain cost of sales$618 $— $— $— $— $— $— $618 
Company restaurant expenses (b)10 38 49 10 — 429 (26)509 
Segment F&P expenses86 33 8 4 6 — (3)134 
Advertising expenses and other services77 156 71 22 25 26 (22)354 
Segment G&A32 33 19 12 53 28 — 176 
Adjustments:
Cash distributions received from equity method investments4 — — — — — — 4 
Adjusted Operating Income$317 $136 $58 $16 $205 $5 $— $737 
Additional segment information:
Depreciation and amortization$27 $12 $4 $1 $7 $23 $— $74 
(Income) loss from equity method investments$(4)$— $— $— $(3)$— $— $(6)
Capital expenditures$13 $3 $4 $2 $2 $59 $— $83 
(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.
Nine Months Ended September 30, 2026
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$3,270 $1,004 $593 $186 $816 $1,441 $— $7,309 
Intersegment revenues (a)— 153 — — 1 — (155)— 
Total revenues$3,270 $1,157 $593 $186 $817 $1,441 $(155)$7,309 
Operating costs and expenses:
Supply chain cost of sales$1,817 $— $— $— $— $— $— $1,817 
Company restaurant expenses (b)28 120 128 30 — 1,265 (77)1,494 
Segment F&P expenses254 99 14 8 (4)— (10)361 
Advertising expenses and other services249 453 220 64 70 75 (67)1,064 
Segment G&A100 97 55 38 155 79 — 523 
Adjustments:
Cash distributions received from equity method investments11 — — — — — — 11 
Adjusted Operating Income$833 $388 $177 $47 $596 $21 $— $2,061 
Additional segment information:
Depreciation and amortization$81 $36 $11 $4 $21 $76 $— $229 
(Income) loss from equity method investments$(11)$(1)$— $— $1 $— $— $(10)
Capital expenditures$28 $13 $11 $3 $7 $96 $— $158 
Three Months Ended September 30, 2025
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$1,125 $338 $201 $60 $268 $459 $— $2,449 
Intersegment revenues (a)— 49 — — — — (49)— 
Total revenues$1,125 $387 $201 $60 $268 $459 $(49)$2,449 
Operating costs and expenses:
Supply chain cost of sales$619 $— $— $— $— $— $— $619 
Company restaurant expenses (b)11 59 39 9 — 403 (24)498 
Segment F&P expenses86 35 3 5 7 — (4)131 
Advertising expenses and other services77 141 79 19 25 23 (21)342 
Segment G&A33 30 17 12 47 23 — 162 
Adjustments:
Cash distributions received from equity method investments4 — — — — — — 4 
Adjusted Operating Income$304 $123 $63 $14 $189 $10 $— $702 
Additional segment information:
Depreciation and amortization$27 $13 $4 $1 $8 $24 $— $76 
(Income) loss from equity method investments$(4)$— $— $— $2 $— $— $(2)
Capital expenditures$15 $7 $4 $2 $3 $58 $— $89 
Nine Months Ended September 30, 2025
THBKPLKFHSINTLRHELIMTotal
Revenues from external customers$3,112 $985 $605 $172 $735 $1,360 $— $6,968 
Intersegment revenues (a)— 146 — — — — (146)— 
Total revenues$3,112 $1,131 $605 $172 $735 $1,360 $(146)$6,968 
Operating costs and expenses:
Supply chain cost of sales$1,704 $— $— $— $— $— $— $1,704 
Company restaurant expenses (b)30 170 118 28 — 1,188 (71)1,464 
Segment F&P expenses246 98 10 8 21 — (12)372 
Advertising expenses and other services236 419 230 57 70 68 (63)1,017 
Segment G&A104 97 57 39 145 70 — 512 
Adjustments:
Cash distributions received from equity method investments11 — — — — — — 11 
Adjusted Operating Income$803 $347 $188 $41 $499 $33 $— $1,910 
Additional segment information:
Depreciation and amortization$82 $39 $11 $4 $22 $67 $— $225 
(Income) loss from equity method investments$(11)$(1)$— $— $(1)$— $— $(12)
Capital expenditures$28 $18 $8 $4 $9 $95 $— $162 
The following table presents the components of Company restaurant expenses for our RH segment (in millions):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2026202520262025
Company restaurant expenses for RH segment
Food, beverage, and packaging costs$148 $136 $435 $391 
Restaurant wages and related expenses154 148 454 445 
Restaurant occupancy expense and other126 119 376 353 
             Total$429 $403 $1,265 $1,188 
The following tables present revenues by country (in millions):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2026202520262025
Revenues by country (a):
     United States$1,182 $1,148 $3,478 $3,386 
     Canada1,039 1,028 2,978 2,835 
     Other304 273 853 747 
Total$2,525 $2,449 $7,309 $6,968 
(a)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
September 30,		Nine Months Ended
September 30,
2026202520262025
Income from operations$696 $663 $2,018 $1,581 
Franchise agreement and reacquired franchise rights amortization16 16 48 49 
RH and BK China Transaction costs2 7 11 29 
Corporate restructuring and advisory fees5 1 9 7 
Impact of equity method investments (a)(3)2 1 (1)
Other operating expenses (income), net20 12 (27)244 
Adjusted Operating Income $737 $702 $2,061 $1,910 
(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.