Restaurant Brands International Inc. (“RBI”) (NYSE: QSR) (TSX: QSR) (TSX: QSP), the parent company of some of the world’s most iconic restaurant brands, including Tim Hortons, Burger King, Popeyes, and Firehouse Subs, today announced its financial results for the second quarter ended June 30, 2025.
Josh Kobza, Chief Executive Officer of RBI, expressed optimism about the company’s performance and outlook:
“We made great progress in the second quarter advancing our strategic priorities, with improved sales trends and strong execution led by our two largest businesses, Tim Hortons and our International segment. Across our global system, we’re seeing strong alignment with our franchise partners, more impactful marketing campaigns, and focused operational initiatives—all contributing to a significantly improved guest experience. With this momentum, we remain confident in our ability to deliver over 8% organic Adjusted Operating Income (AOI) growth for the full year 2025.”
Segment Reporting and Strategic Acquisitions
RBI continues to report under six operating and reportable segments. These include four key franchisor segments—Tim Hortons (TH), Burger King (BK), Popeyes Louisiana Kitchen (PLK), and Firehouse Subs (FHS)—within the U.S. and Canada. A fifth segment represents franchisor operations for all four brands in international markets (INTL).
During the second quarter, RBI completed two major acquisitions:
- On May 16, 2024, the company acquired Carrols Restaurant Group Inc., the largest Burger King franchisee in the U.S.
- On June 28, 2024, RBI acquired Popeyes China, strengthening its presence in Asia.
Following these strategic deals, RBI established a new operating segment called Restaurant Holdings (RH). This segment includes operational results from Carrols’ Burger King restaurants and Popeyes China beginning on their respective acquisition dates, along with Firehouse Subs Brazil results beginning in 2025.
Although RBI intends to operate RH in the near term, its long-term strategy remains focused on a predominantly franchised model. The company plans to refranchise the majority of the acquired Carrols locations and is actively searching for new operating partners for Popeyes China and new investors for Firehouse Subs Brazil.
The RH segment includes company-operated restaurant sales and expenses, such as royalties, rent, and advertising. These are simultaneously recognized as revenue in the relevant franchisor segments and then eliminated in consolidated results for accurate reporting. Additional details can be found in the “Restaurant Holdings Intersegment Dynamics” presentation posted on RBI’s investor relations site as of August 8, 2024.
Adjusted Operating Income (AOI) Presentation Update
Beginning with year-end 2024 results, RBI modified its AOI presentation. The company now defines Segment Franchise and Property Expenses (Segment F&P Expenses) as expenses excluding amortization of franchise agreements and reacquired franchise rights. Previously, these amortizations were included in segment-level F&P expenses and later adjusted in AOI calculations. While this presentation change improves transparency, it does not affect overall AOI or consolidated financial results.
Burger King China Update: Held for Sale Classification
On February 14, 2025, RBI acquired nearly all remaining equity interests in Burger King China (BK China) from its former joint venture partners. However, consistent with RBI’s franchising strategy, the company is currently seeking a new controlling shareholder for BK China.
As such, BK China has been classified as “held for sale” and reported as discontinued operations. These assets are available for immediate disposition and are expected to be sold within a year. While BK China is not included in 2025 INTL segment financial results, its Key Performance Indicators (KPIs) are still included within the INTL segment’s KPI disclosures.
Convention Timing and Its Minor Financial Impact
Convention events held across RBI brands had a minimal effect on financial outcomes for the quarter. PLK held conventions in both Q2 2024 and Q2 2025, while Tim Hortons hosted its convention in Q2 2024 only, and INTL conducted one in Q2 2025. Associated revenues and expenses are included in each brand’s respective franchise and property line items.
Supplemental Disclosures Available
To provide investors with enhanced transparency, RBI has posted a range of supplemental disclosures on its Investor Relations webpage under the “Financial Information” section. These include:
- Brand-specific KPIs for domestic and international operations
- Disaggregated segment results, including royalties, franchise fees, and property revenues
- Intersegment eliminations
- BK China KPIs and selected financial data
- Burger King U.S. “Reclaim the Flame” investment updates
- RH Burger King Carrols’ restaurant-level EBITDA margins
Financial Highlights for Q2 2025
RBI reported a notable increase in Total Revenues, driven largely by higher system-wide sales, increased consumer packaged goods (CPG) net sales, and stronger supply chain performance, fueled by elevated commodity prices. These gains were slightly offset by a $10 million unfavorable impact from foreign exchange (FX). Excluding FX, total revenues rose by $63 million compared to the same period last year.
Adjusted Operating Income (AOI) also increased, benefiting from both the revenue growth and a decline in Segment General and Administrative (G&A) expenses—primarily from lower compensation-related costs. Offsetting these gains were higher supply chain costs, driven by increased volumes and rising commodity prices, as well as net bad debt expenses this quarter compared to recoveries in Q2 2024. A $3 million FX impact also weighed on AOI. Excluding FX, AOI rose by $12 million year-over-year.
It’s important to note that Burger King segment results continue to reflect intersegment revenue, including royalties and advertising contributions from the RH Burger King restaurants acquired via Carrols.
Burger King U.S.: Progress on “Reclaim the Flame” Plan
Burger King U.S. is progressing well on its “Reclaim the Flame” turnaround strategy, designed to reignite growth and enhance franchisee profitability. The plan involves a total investment of up to $700 million through 2028, split between:
- “Fuel the Flame”: Advertising and digital innovation investments, now fully completed as of Q4 2024.
- “Royal Reset”: Restaurant remodels, relocations, technology upgrades, and kitchen improvements.
As of June 30, 2025, RBI has invested $152 million out of a planned $550 million into the Royal Reset portion of the program.
In Q2 2025, AOI growth in the Burger King segment benefited from the absence of $6 million in Fuel the Flame-related expenses that were incurred in the same period last year. Lower G&A expenses, primarily driven by reduced compensation costs, also contributed to profitability. These gains were partially offset by higher net bad debt expenses in Q2 2025.
