(Reuters) – Restaurant Brands missed first-quarter revenue and profit estimates on Thursday, hurt by sluggish demand at its restaurant chains such as Burger King and Tim Hortons against the backdrop of tariff-related uncertainty.
The restaurant industry has been battling ongoing sales declines as budget-conscious Americans stick to home-cooked meals, prioritizing spending on essentials over dining out.
The U.S. economy shrank for the first time in three years in the first quarter, signaling consumers are expecting product prices to shoot up due to the escalating global trade tensions.
The Trump administration’s shifting tariff policies have forced businesses across industries to raise prices in an effort to protect profit margins from rising input costs and supply chain disruptions.
Fast-food chain operators such as McDonald’s, Domino’s, Chipotle and Starbucks took a hit to sales and flagged weak consumer demand.
Restaurant Brands’ increased advertising and promotional efforts such as $5 value meals didn’t connect well with middle-to-lower-income groups.
The company’s total comparable sales rose 0.1% in the quarter, largely below the 4.6% rise a year earlier.
Restaurant Brands reported quarterly revenue of $2.11 billion, compared with analysts’ average expectation of $2.13 billion, according to data compiled by LSEG.
On an adjusted basis, the company earned 75 cents per share, compared with estimates of 78 cents.
(Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Shounak Dasgupta)
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