Restaurant Brands International Limited Partnership
For the period ended Sep 30, 2026. Filed Oct 29, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Oct 29, 2026
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0001618755-26-000030
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-10-29.
0001618755-26-000042
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 105 previous paragraphs and 111 current paragraphs.
52 unchanged; 47 reworded; 11 added; 4 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 18 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
During the three months ended September 30, 2026, the increase in general and administrative expenses was primarily driven by higher Segment G&A in our INTL, RH, BK, and PLK segments, primarily due to higher compensation-related expenses, and an increase in Corporate restructuring and advisory fees, partially offset by a decrease in RH and BK China Transaction costs.
Current report
During the three months ended September 30, 2026, the increase in Total revenues was driven by higher Supply chain sales primarily due to increases in equipment sales to franchisees and commodity prices, as well as higher Franchise and property revenues primarily from increased system-wide sales. Results also reflect an unfavorable FX Impact.
Current report
During the three months ended September 30, 2026, the increase in Adjusted Operating Income was primarily driven by tariff refunds and higher Franchise and property revenues. Results also reflect an unfavorable FX Impact.
Current report
Franchise and property revenues and Segment F&P expenses reflect convention revenues and expenses recognized during the three and nine months ended September 30, 2025. Convention-related revenues and expenses have an immaterial net impact to Adjusted Operating Income.
Current report
During the three months ended September 30, 2026, the increase in Total revenues was primarily driven by higher Company restaurant sales due to restaurants acquired during the period, partially offset by lower Advertising revenues and other services due primarily to a decline in advertising fund contributions.
Current report
During the nine months ended September 30, 2026, the decrease in Total revenues was primarily driven by a decline in comparable sales, partially offset by higher Company restaurant sales due to restaurants acquired during the period.
Current report
During the three months ended September 30, 2026, the decrease in Adjusted Operating Income was primarily driven by a decline in comparable sales and an increase in Segment G&A, partially offset by higher Company restaurant sales.
Current report
During the nine months ended September 30, 2026, the decrease in Adjusted Operating Income was primarily driven by a decline in comparable sales.
Current report
Franchise and property revenues and Segment F&P expenses reflect convention revenues and expenses recognized during the three and nine months ended September 30, 2026 and the nine months ended September 30, 2025. Convention-related revenues and expenses have an immaterial net impact to Adjusted Operating Income.
Current report
Franchise and property revenues and Segment F&P expenses reflect Burger King international convention revenues and expenses recognized during the nine months ended September 30, 2025. Convention-related revenues and expenses have an immaterial net impact to Adjusted Operating Income.
Current report
Pursuant to exchange notices received, Partnership exchanged 6,430,266 Partnership exchangeable units during the nine months ended September 30, 2026. In accordance with the applicable terms of the partnership agreement, Partnership satisfied the exchange notices by repurchasing 2,784,549 Partnership exchangeable units for approximately $214 million in cash and exchanging 3,645,717 Partnership exchangeable units for the same number of newly issued RBI common shares. Each such Partnership exchangeable unit was cancelled upon settlement of the exchange.
Removed paragraphs (4)
Previous report
During the three and six months ended June 30, 2026, the decreases in Total revenues were primarily driven by the decline in comparable sales.
Previous report
During the three and six months ended June 30, 2026, the decreases in Adjusted Operating Income were primarily driven by the decline in comparable sales. For the six months ended June 30, 2026, this factor was partially offset by a decrease in Segment G&A, primarily due to lower compensation-related expenses.
Previous report
During the three and six months ended June 30, 2026, Franchise and property revenues and Segment F&P expenses reflect the non-recurrence of convention revenue and expenses recognized in 2025.
Previous report
During the three and six months ended June 30, 2026, Franchise and property revenues and Segment F&P expenses reflect the non-recurrence of convention revenue and expenses recognized in 2025.
Reworded paragraphs (47)
Previous wording
The following Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with the unaudited condensed consolidated financial statements and the related notes thereto (“Financial Statements”) in Item 1 and the Special Note Regarding Forward-Looking Statements later in this Item 2. All Note references herein refer to the Notes to the Financial Statements. Tabular amounts are displayed in millions of U.S. dollars except per unit and unit count amounts, or as otherwise specifically identified. All references to “Canadian dollars” or “C$” are to the currency of Canada unless otherwise indicated. Percentages may not recompute due to rounding.
Current wording
The following Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes thereto (“Financial Statements”) in Item 1 and the Special Note Regarding Forward-Looking Statements later in this Item 2. All Note references herein refer to the Notes to the Financial Statements. Tabular amounts are displayed in millions of U.S. dollars except per unit and unit count amounts, or as otherwise specifically identified. All references to “Canadian dollars” or “C$” are to the currency of Canada unless otherwise indicated. Percentages may not recompute due to rounding.
Previous wording
We are one of the world’s largest quick service restaurant (“QSR”) companies with nearly $49 billion in annual system-wide sales and over 33,000 restaurants, over 95% of which are franchised, in more than 120 countries and territories as of June 30, 2026. We own and franchise four iconic brands, Tim Hortons®, Burger King®, Popeyes®, and Firehouse Subs®. Our brands have complementary daypart mixes and product platforms that benefit from global scale and the sharing of best practices while preserving the independence and rich heritage of each brand.
Current wording
We are one of the world’s largest quick service restaurant (“QSR”) companies with over $49 billion in annual system-wide sales and over 33,000 restaurants, over 95% of which are franchised, in more than 120 countries and territories as of September 30, 2026. We own and franchise four iconic brands, Tim Hortons®, Burger King®, Popeyes®, and Firehouse Subs®. Our brands have complementary daypart mixes and product platforms that benefit from global scale and the sharing of best practices while preserving the independence and rich heritage of each brand.
Previous wording
We have six operating and reportable segments, including four franchisor segments for our Tim Hortons, Burger King, Popeyes, and Firehouse Subs brands in the U.S. and Canada (“TH”, “BK”, “PLK”, and “FHS”, respectively) and a fifth franchisor segment for all of our brands in the rest of the world (“INTL”). Additionally, we have a sixth operating and reportable segment, Restaurant Holdings (“RH”), which includes the operations of Burger King restaurants acquired as part of our acquisition of Carrols Restaurant Group Inc. (the “Carrols Acquisition”), as well as our acquisition of Popeyes China (“PLK China”) (“PLK China Acquisition”) and Firehouse Subs Brazil (“FHS Brazil”) restaurants.
Current wording
We have six operating and reportable segments, including four franchisor segments for our Tim Hortons, Burger King, Popeyes, and Firehouse Subs brands in the U.S. and Canada (“TH”, “BK”, “PLK”, and “FHS”, respectively) and a fifth franchisor segment for all of our brands in the rest of the world (“INTL”). Additionally, we have a sixth operating and reportable segment, Restaurant Holdings (“RH”), which includes the operations of (i) Burger King restaurants acquired in our acquisition of Carrols Restaurant Group Inc. (the “Carrols Acquisition”), (ii) restaurants acquired in our acquisition of Popeyes China (“PLK China”) (“PLK China Acquisition”), and (iii) Firehouse Subs Brazil (“FHS Brazil”) restaurants.
Previous wording
RBI maintains the franchisor dynamics in its TH, BK, PLK, FHS, and INTL segments (“five franchisor segments”) to report results consistent with how the business will be managed long-term. This approach reflects RBI’s intent to refranchise the vast majority of the Carrols Burger King restaurants and to find new partners for PLK China and new investors for FHS Brazil and sunset the RH segment. RH results include Company restaurant sales and expenses, including expenses associated with royalties, rent, and advertising. These expenses are recognized, as applicable, as revenues in the respective franchisor segments (BK for the Carrols Burger King restaurants and INTL for PLK China and FHS Brazil restaurants) and eliminated upon consolidation.
Current wording
RBI maintains the franchisor dynamics in its TH, BK, PLK, FHS, and INTL segments (“five franchisor segments”) to report results consistent with how the business will be managed long-term. This approach reflects RBI’s intent to refranchise the vast majority of the Carrols Burger King restaurants and to find new investors for PLK China and FHS Brazil and sunset the RH segment. RH results include Company restaurant sales and expenses, including expenses associated with royalties, rent, and advertising. These expenses are recognized, as applicable, as revenues in the respective franchisor segments (BK for the Carrols Burger King restaurants and INTL for PLK China and FHS Brazil restaurants) and eliminated upon consolidation.
Previous wording
On February 14, 2025, we acquired substantially all the remaining equity interests in Pangaea Foods (China) Holdings Ltd. (“BK China”). Following the acquisition, we ceased accounting for our interest in BK China as an equity method investment and ceased recognition of franchise revenue. BK China met the criteria to be classified as held for sale and was reported as discontinued operations. On January 30, 2026, we established a joint venture with CPE Alder Investment Limited, a fund managed by CPE (“CPE”), with respect to the operations of BK China (the “BK China JV”). CPE invested $350 million of primary capital into the BK China JV. Following the transaction, we deconsolidated BK China, began accounting for our remaining 17% equity interest in the BK China JV under the equity method of accounting, and resumed recognizing franchise revenue, primarily related to royalties, 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”of the Financial Statements and Note 6,“Equity Method Investments”of the Financial Statements for additional information.
Current wording
On February 14, 2025, we acquired substantially all the remaining equity interests in Pangaea Foods (China) Holdings Ltd. (“BK China”). Following the acquisition, we ceased accounting for our interest in BK China as an equity method investment and ceased recognition of franchise revenue. BK China met the criteria to be classified as held for sale and was reported as discontinued operations. On January 30, 2026, we established a joint venture with CPE Alder Investment Limited, a fund managed by CPE (“CPE”), with respect to the operations of BK China (the “BK China JV”). CPE invested $350 million of primary capital into the BK China JV. Following the transaction, we deconsolidated BK China, began accounting for our remaining 17% equity interest in the BK China JV under the equity method of accounting, and resumed recognizing franchise revenue, primarily related to royalties, 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”of the Financial Statements and Note 6,“Equity Method Investments”of the Financial Statements for additional information.
Previous wording
Results of Operations for the Three and Six Months Ended June 30, 2026 and 2025
Current wording
Results of Operations for the Three and Nine Months Ended September 30, 2026 and 2025
Previous wording
(a)We calculate the FX Impact by translating prior year results at current year monthly average exchange rates. We analyze these results on a constant currency basis as this helps identify underlying business trends, without distortion from the effects of currency movements.
Current wording
Tabular amounts in millions of U.S. dollars unless noted otherwise. Totals, variances, and percentage changes may not calculate exactly due to rounding. We calculate the FX Impact by translating prior year results at current year monthly average exchange rates. We analyze these results on a constant currency basis as this helps identify underlying business trends, without distortion from the effects of currency movements.
Previous wording
During the three and six months ended June 30, 2026, the increases in Total revenues were primarily driven by higher Supply chain sales and increased system-wide sales across our INTL, BK, TH, and FHS segments. Results also reflect a favorable FX Impact.
Current wording
During the three and nine months ended September 30, 2026, the increases in Total revenues were primarily driven by increased system-wide sales across our INTL, BK, TH, and FHS segments and higher Supply chain sales. Results also reflect an unfavorable FX Impact during the three months ended September 30, 2026, and a favorable FX Impact during the nine months ended September 30, 2026.
Previous wording
During the three and six months ended June 30, 2026, the increases in Income from operations were primarily driven by a net gain on foreign exchange arising from remeasurement of foreign denominated assets and liabilities, primarily related to intercompany financing, compared to a net loss in the prior year, as well as higher segment income across our INTL, BK, TH, and FHS segments.
Current wording
During the nine months ended September 30, 2026, the increase in Income from operations was primarily driven by a net gain on foreign exchange arising from remeasurement of foreign denominated assets and liabilities, primarily related to intercompany financing, compared to a net loss in the prior year, as well as higher segment income across our INTL, BK, TH, and FHS segments.
Previous wording
During the three and six months ended June 30, 2026, the increases in Net income from continuing operations were primarily driven by an increase in Income from operations and an Income tax benefit from continuing operations compared to Income tax expense from continuing operations in the prior year.
Current wording
During the three and nine months ended September 30, 2026, the increases in Net income from continuing operations were primarily driven by an increase in Income from operations and an Income tax benefit from continuing operations compared to Income tax expense from continuing operations in the prior year.
Previous wording
(b)Segment G&A excludes expenses from non-recurring projects and non-operating activities, such as RH and BK China Transaction costs, and Corporate restructuring and advisory fees (as defined below).
Current wording
(a)Segment G&A excludes expenses from non-recurring projects and non-operating activities, such as RH and BK China Transaction costs, and Corporate restructuring and advisory fees (as defined below).
Previous wording
During the three and six months ended June 30, 2026, the decreases in general and administrative expenses were primarily driven by decreases in RH and BK China Transaction costs and Corporate restructuring and advisory fees. For the three months ended June 30, 2026, these factors were partially offset by increases in Segment G&A in our INTL and RH segments, primarily due to higher compensation-related expenses. For the six months ended June 30, 2026, results also reflect lower Segment G&A in our PLK, TH, BK, and FHS segments, primarily due to lower compensation-related expenses, partially offset by higher Segment G&A in our RH segment, primarily due to higher compensation-related expenses. Results also reflect an unfavorable FX Impact.
Current wording
During the nine months ended September 30, 2026, the decrease in general and administrative expenses was primarily driven by a decrease in RH and BK China Transaction costs and lower Segment G&A in our TH and PLK segments, primarily due to lower compensation-related expenses. These factors were partially offset by higher Segment G&A in our RH and INTL segments, primarily due to higher compensation-related expenses, as well as higher Corporate restructuring and advisory fees. Results also reflect an unfavorable FX Impact.
Previous wording
The change in (income) loss from equity method investments reflects changes in earnings of our equity method investments during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025.
Current wording
The change in (income) loss from equity method investments reflects changes in earnings of our equity method investments during the three and nine months ended September 30, 2026 compared to the prior year periods.
Previous wording
Litigation settlements and reserves, net primarily reflect accruals, payments made, and proceeds received in connection with litigation and arbitration matters and other business disputes.
Current wording
Litigation settlements (gains) and reserves, net primarily reflect accruals, payments made, and proceeds received in connection with litigation and arbitration matters and other business disputes.
Previous wording
During the three and six months ended June 30, 2026, interest expense, net decreased primarily due to a decrease in long-term debt, driven by the voluntary repayment of a portion of Term Loan B during 2025.
Current wording
During the three and nine months ended September 30, 2026, interest expense, net decreased primarily due to a decrease in long-term debt, driven by the voluntary repayment of a portion of Term Loan B during 2025.
Previous wording
Our effective tax rate was (12.3)% and 24.8% for the three months ended June 30, 2026 and 2025, respectively, and (3.2)% and 25.8% for the six months ended June 30, 2026 and 2025, respectively. The changes in our effective tax rates were primarily due to discrete tax benefits resulting from the movements in net deferred taxes in connection with intra-group reorganizations, partially offset by the impact of the administrative guidance issued by the Organization of Economic Cooperation and Development (“OECD”) in 2025.
Current wording
Our effective tax rate was (23.2)% and 17.6% for the three months ended September 30, 2026 and 2025, respectively, and (10.2)% and 22.1% for the nine months ended September 30, 2026 and 2025, respectively. The changes in our effective tax rates were primarily due to discrete tax benefits resulting from the movements in net deferred tax assets in connection with intra-group reorganizations undertaken in 2026, partially offset by the impact of the administrative guidance issued by the Organization for Economic Cooperation and Development (“OECD”) in 2025.
Previous wording
Segment Results of Operations for the Three and Six Months Ended June 30, 2026 and 2025
Current wording
Segment Results of Operations for the Three and Nine Months Ended September 30, 2026 and 2025
Previous wording
During the three and six months ended June 30, 2026, the increases in Total revenues were primarily driven by higher Supply chain sales due to increases in commodity prices and CPG net sales. For the six months ended June 30, 2026, results also reflect a favorable FX Impact.
Current wording
During the nine months ended September 30, 2026, the increase in Total revenues was primarily driven by higher Supply chain sales due to increases in commodity prices and equipment sales to franchisees, as well as higher Franchise and property revenues primarily from increased system-wide sales. Results also reflect a favorable FX Impact.
Previous wording
During the six months ended June 30, 2026, the increase in Adjusted Operating Income was primarily driven by revenue growth and a decrease in Segment G&A primarily due to lower compensation-related expenses. These factors were partially offset by higher Supply chain cost of sales primarily due to higher commodity prices. Adjusted Operating Income was also impacted by increases in Advertising expenses and other services driven by the timing of marketing-related expenditures. Results also reflect a favorable FX Impact.
Current wording
During the nine months ended September 30, 2026, the increase in Adjusted Operating Income was primarily driven by tariff refunds, revenue growth, and a decrease in Segment G&A. These factors were partially offset by an increase in Supply chain cost of sales, primarily due to higher commodity prices. Adjusted Operating Income was also impacted by increases in Advertising expenses and other services driven by the timing of marketing-related expenditures. Results also reflect a favorable FX Impact.
Previous wording
(a)Franchise and property revenues include intersegment revenues with RH consisting of royalties and rent of $30 million and $57 million during the three and six months ended June 30, 2026, respectively, and $27 million and $55 million during three and six months ended June 30, 2025, respectively, which are eliminated in consolidation.
Current wording
(a)Franchise and property revenues include intersegment revenues with RH consisting of royalties and rent of $29 million and $86 million during the three and nine months ended September 30, 2026, respectively, and $28 million and $83 million during three and nine months ended September 30, 2025, respectively, which are eliminated in consolidation.
Previous wording
(b)Advertising revenues and other services include intersegment revenues with RH consisting of advertising contributions and tech fees of $24 million and $45 million during the three and six months ended June 30, 2026, respectively, and $22 million and $42 million during the three and six months ended June 30, 2025, respectively, which are eliminated in consolidation.
Current wording
(b)Advertising revenues and other services include intersegment revenues with RH consisting of advertising contributions and tech fees of $22 million and $67 million during the three and nine months ended September 30, 2026, respectively, and $21 million and $63 million during the three and nine months ended September 30, 2025, respectively, which are eliminated in consolidation.
Previous wording
During the three and six months ended June 30, 2026, the increases in Total revenues were primarily driven by the increase in comparable sales, partially offset by the net impact of refranchisings.
Current wording
During the three and nine months ended September 30, 2026, the increases in Total revenues were primarily driven by the increase in comparable sales, partially offset by the net impact of refranchisings.
Previous wording
During the three and six months ended June 30, 2026, the increases in Adjusted Operating Income were primarily driven by higher Franchise and property revenues.
Current wording
During the three and nine months ended September 30, 2026, the increases in Adjusted Operating Income were primarily driven by higher Franchise and property revenues.
Previous wording
During the three and six months ended June 30, 2026, the increases in Total revenues and Adjusted Operating Income were primarily driven by the increase in restaurant count.
Current wording
During the three and nine months ended September 30, 2026, the increases in Total revenues and Adjusted Operating Income were primarily driven by the increase in restaurant count.
Previous wording
During the three and six months ended June 30, 2026, the increases in Total revenues were primarily driven by higher royalty revenues from Burger King and Popeyes restaurants resulting from the increase in system-wide sales, as well as the resumption of royalty revenues from BK China following the establishment of the BK China JV. Results also reflect a favorable FX Impact.
Current wording
During the three and nine months ended September 30, 2026, the increases in Total revenues were primarily driven by higher royalty revenues from Burger King and Popeyes restaurants resulting from the increase in system-wide sales, as well as the resumption of royalty revenues from BK China following the establishment of the BK China JV. For the nine months ended September 30, 2026, results also reflect a favorable FX Impact.
Previous wording
During the three months ended June 30, 2026, the increase in Adjusted Operating Income was driven by revenue growth, partially offset by an increase in Segment G&A primarily due to higher compensation-related expenses. Results also reflect a favorable FX Impact.
Current wording
During the three months ended September 30, 2026, the increase in Adjusted Operating Income was driven by revenue growth, partially offset by an increase in Segment G&A.
Previous wording
During the six months ended June 30, 2026, the increase in Adjusted Operating Income was driven by revenue growth and a decrease in Segment F&P expenses, reflecting net bad debt recoveries in the current year compared to net bad debt expense in the prior year. Results also reflect a favorable FX Impact.
Current wording
During the nine months ended September 30, 2026, the increase in Adjusted Operating Income was driven by revenue growth and a decrease in Segment F&P expenses, reflecting net bad debt recoveries in the current year compared to net bad debt expense in the prior year. These factors were partially offset by an increase in Segment G&A. Results also reflect a favorable FX Impact.
Previous wording
Note: RH KPIs are shown consistently with RBI’s reporting calendar, but in 2025, results from BK Carrols restaurants in the statements of operations were shown consistently with the Carrols reporting calendar, which for the three and six months ended June 30, 2025 were from March 31, 2025 to June 29, 2025 and from December 30, 2024 to June 29, 2025, respectively.
Current wording
Note: RH KPIs are shown consistently with RBI’s reporting calendar, but in 2025, results from BK restaurants in the statements of operations were shown consistently with the Carrols reporting calendar, which for the three and nine months ended September 30, 2025 were from June 30, 2025 to September 28, 2025 and from December 30, 2024 to September 28, 2025, respectively.
Previous wording
(a)Restaurant occupancy and other expenses include intersegment royalties and property expenses of $31 million and $58 million during the three and six months ended June 30, 2026, respectively, and $27 million and $55 million for the three and six months ended June 30, 2025, respectively, which are eliminated in consolidation.
Current wording
(a)Restaurant occupancy and other expenses include intersegment royalties and property expenses of $30 million and $88 million during the three and nine months ended September 30, 2026, respectively, and $28 million and $83 million for the three and nine months ended September 30, 2025, respectively, which are eliminated in consolidation.
Previous wording
(b)Advertising expenses and other services include intersegment advertising expenses and tech fees of $24 million and $45 million during the three and six months ended June 30, 2026, respectively, and $22 million and $42 million for the three and six months ended June 30, 2025, respectively, which are eliminated in consolidation.
Current wording
(b)Advertising expenses and other services include intersegment advertising expenses and tech fees of $22 million and $67 million during the three and nine months ended September 30, 2026, respectively, and $21 million and $63 million for the three and nine months ended September 30, 2025, respectively, which are eliminated in consolidation.
Previous wording
The RH segment includes results from (i) Burger King restaurants acquired as part of the Carrols Acquisition and (ii) PLK China and FHS Brazil restaurants. RBI is actively working to refranchise the Carrols Burger King restaurants, and as a result, RH segment results reflect the impact of refranchisings as well as incremental investments in the PLK China and FHS Brazil start-up businesses.
Current wording
The RH segment includes results from (i) Burger King restaurants acquired as part of the Carrols Acquisition and (ii) PLK China and FHS Brazil restaurants. RH segment results reflect the impact of refranchising Carrols Burger King restaurants as well as incremental investments in the PLK China and FHS Brazil start-up businesses.
Previous wording
During the three and six months ended June 30, 2026, the increases in Total revenues were primarily driven by an increase in BK US comparable sales and an increase in PLK China restaurant count, partially offset by BK US refranchisings.
Current wording
During the three and nine months ended September 30, 2026, the increases in Total revenues were primarily driven by an increase in BK US comparable sales and an increase in PLK China restaurant count, partially offset by the refranchisings of Carrols Burger King restaurants.
Previous wording
During the three months ended June 30, 2026, Adjusted Operating Income remained relatively flat as revenue growth was offset by an increase in Company restaurant expenses. During the six months ended June 30, 2026, the decrease in Adjusted Operating Income was primarily driven by an increase in Company restaurant expenses, partially offset by an increase in revenues. The increase in Company restaurant expenses in both periods reflects higher BK US Company restaurant expenses, primarily driven by increased sales and depreciation and amortization expense, as well as expenses related to scaling our international start-up businesses.
Current wording
During the three and nine months ended September 30, 2026, the decreases in Adjusted Operating Income were primarily driven by increases in Company restaurant expenses and Segment G&A, partially offset by higher revenues. The increases in Company restaurant expenses reflect higher Carrols Burger King Company restaurant expenses, primarily driven by increased sales, and higher expenses related to scaling our international start-up businesses. For the nine months ended September 30, 2026, the increase in Company restaurant expenses also reflected higher depreciation and amortization expenses.
Previous wording
The table below contains information regarding Adjusted Operating Income, which is a non-GAAP measure. This non-GAAP measure does not have a standardized meaning under U.S. GAAP and may differ from a similarly captioned measure of other companies in our industry. We believe this non-GAAP measure is useful to investors in assessing our operating performance, as it provides them with the same tools that management uses to evaluate our performance and is responsive to questions we receive from both investors and analysts. By disclosing this non-GAAP measure, we intend to provide investors with a consistent comparison of our operating results and trends for the periods presented. Adjusted Operating Income is defined as income from operations excluding (i) franchise agreement and reacquired franchise rights 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; 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. Management believes that these types of expenses are either not related to our underlying profitability drivers or not likely to reoccur in the foreseeable future, and the varied timing, size, and nature of these projects may cause volatility in our results unrelated to the performance of our core business that does not reflect trends of our core operations.
Current wording
The table below contains information regarding Adjusted Operating Income, which is a non-GAAP measure. This non-GAAP measure does not have a standardized meaning under U.S. GAAP and may differ from a similarly captioned measure used by other companies in our industry. We believe this non-GAAP measure is useful to investors in assessing our operating performance, as it provides them with the same tools that management uses to evaluate our performance and is responsive to questions we receive from both investors and analysts. By disclosing this non-GAAP measure, we intend to provide investors with a consistent comparison of our operating results and trends for the periods presented. Adjusted Operating Income is defined as income from operations excluding (i) franchise agreement and reacquired franchise rights 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 presented, 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; 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. Management believes that these types of expenses are either not related to our underlying profitability drivers or not likely to reoccur in the foreseeable future, and the varied timing, size, and nature of these projects may cause volatility in our results unrelated to the performance of our core business or the trends of our core operations.
Previous wording
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. Adjusted Operating Income, as defined above, also represents our measure of segment income for each of our operating segments.
Current wording
Adjusted Operating Income is used by management to measure the operating performance of our business, excluding non-cash and other specifically identified items described above which management believes are not relevant to its assessment of our operating performance. Adjusted Operating Income, as defined above, also represents our measure of segment income for each of our operating segments.
Previous wording
The increases in Adjusted Operating Income for the three and six months ended June 30, 2026 reflect increases in segment income in our INTL, BK, TH, and FHS segments, partially offset by decreases in segment income in our PLK segment. For the six months ended June 30, 2026, these factors were also partially offset by a decrease in segment income in our RH segment.
Current wording
The increases in Adjusted Operating Income for the three and nine months ended September 30, 2026 reflect increases in segment income in our INTL, BK, TH, and FHS segments, partially offset by decreases in segment income in our PLK and RH segments.
Previous wording
Our primary sources of liquidity are cash on hand, cash generated by operations, and borrowings available under our Revolving Credit Facility (as defined below). We have used, and may in the future use, our liquidity to make required interest and/or principal payments, to make distributions to RBI for RBI to repurchase its common shares, to repurchase Class B exchangeable limited partnership units of Partnership (“Partnership exchangeable units”), to voluntarily prepay and repurchase our or any of our affiliates’ outstanding debt, to fund acquisitions and other investing activities, such as capital expenditures and joint ventures, and make distributions on Class A common units and distributions on the Partnership exchangeable units. Our liquidity requirements are significant, primarily due to debt service requirements.
Current wording
Our primary sources of liquidity are cash on hand, cash generated by operations, and borrowings available under our Revolving Credit Facility (as defined below). We have used, and may in the future use, our liquidity to make required interest and/or principal payments, to make distributions to RBI for RBI to repurchase its common shares, to repurchase Class B exchangeable limited partnership units of Partnership (“Partnership exchangeable units”), to voluntarily prepay, redeem or repurchase our or any of our affiliates’ outstanding debt, to fund acquisitions and other investing activities, such as capital expenditures and joint venture investments, and make distributions on Class A common units and distributions on the Partnership exchangeable units. Our liquidity requirements are significant, primarily due to debt service requirements.
Previous wording
As of June 30, 2026, we had cash and cash equivalents of $1,063 million and borrowing availability of $1,248 million under our senior secured revolving credit facility (the “Revolving Credit Facility”). Based on our current level of operations and available cash, we believe our cash flow from operations, combined with our availability under our Revolving Credit Facility, will provide sufficient liquidity to fund our current obligations, debt service requirements and capital spending over the next twelve months.
Current wording
As of September 30, 2026, we had cash and cash equivalents of $974 million and borrowing availability of $1,248 million under our senior secured revolving credit facility (the “Revolving Credit Facility”). Based on our current level of operations and available cash, we believe our cash flow from operations, combined with our availability under our Revolving Credit Facility, will provide sufficient liquidity to fund our current obligations, debt service requirements, and capital spending over the next twelve months.
Previous wording
Burger King is executing its multi-year "Reclaim the Flame" plan to accelerate sales growth and drive franchisee profitability. This plan includes investing up to $700 million through year-end 2028, comprised of advertising and digital investments (which we completed in 2024) and high-quality remodels and relocations, restaurant technology, kitchen equipment, and building enhancements ("Royal Reset"). As of June 30, 2026, we have funded $194 million out of up to $550 million planned toward the Royal Reset investments. These amounts are not inclusive of funds applied to remodels of Burger King restaurants acquired in the Carrols Acquisition.
Current wording
Burger King is executing its multi-year “Reclaim the Flame” plan to accelerate sales growth and drive franchisee profitability. This plan includes investing up to $700 million through year-end 2028, comprised of advertising and digital investments (which we completed in 2024) and high-quality remodels and relocations, restaurant technology, kitchen equipment, and building enhancements (“Royal Reset”). As of September 30, 2026, we have funded $198 million out of up to $550 million planned toward the Royal Reset investments. These amounts are not inclusive of funds applied to remodels of Burger King restaurants acquired in the Carrols Acquisition.
Previous wording
As of June 30, 2026, we had outstanding cross-currency rate swap contracts designated as hedges between the Canadian dollar and U.S. dollar in which we receive quarterly fixed-rate interest payments on the U.S. dollar aggregate amount of $5,700 million and between the euro and U.S. dollar, in which we receive quarterly fixed-rate interest payments on the U.S. dollar aggregate amount of $2,750 million. We expect to receive $50 million in fixed-rate interest payments in the next twelve months in connection with these outstanding cross-currency swaps.
Current wording
As of September 30, 2026, we had outstanding cross-currency rate swap contracts designated as hedges between the Canadian dollar and U.S. dollar, in which we receive quarterly fixed-rate interest payments on the U.S. dollar aggregate amount of $5,700 million and between the euro and U.S. dollar, in which we receive quarterly fixed-rate interest payments on the U.S. dollar aggregate amount of $2,750 million. We expect to receive $54 million in fixed-rate interest payments in the next twelve months in connection with these outstanding cross-currency swaps.
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Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
During the three months ended September 30, 2026, the increase in Income from operations was primarily driven by higher segment income across our INTL, BK, TH, and FHS segments.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Tabular amounts in millions of U.S. dollars unless noted otherwise. Totals, variances, and percentage changes may not calculate exactly due to rounding.
Previous report — wording carried elsewhere
During the three months ended June 30, 2026, the increase in Adjusted Operating Income was primarily driven by revenue growth, partially offset by higher Supply chain cost of sales primarily due to higher commodity prices.