How we source: figures on this page come from the company’s own filings (SEC 10-K, 10-Q and earnings releases, or its annual report), with the period stated next to each number. Last refreshed October 2026. Our methodology.
In short
KFC makes money mostly by franchising its brand. Franchisees run 99% of its 33,897 restaurants and pay fees on their sales, typically 4% to 6% of sales under store-level agreements. In fiscal 2025 the KFC Division booked $3,542M of revenue on $36.4B of system sales, and earned $1,503M of operating profit.
KFC, a popular fast food chain, operates on a business model focused on providing tasty and convenient food to fast food consumers. They offer unique flavors and recipes, emphasizing quick service and efficiency. KFC generates revenue through restaurant sales, franchise fees, and royalty/advertising fees. Their key activities include food preparation, restaurant operations, and brandmarketing. Key resources include secret recipes, a robust supply chain โ as explored in how AI is restructuring the traditional value chain โ , and brand loyalty. KFC forms partnerships with franchisees, suppliers, and delivery service providers. Their cost structure includes food/ingredient costs, restaurant operations, marketing expenses, and franchise support/training.
KFC is a division of Yum! Brands, which also owns Taco Bell, Pizza Hut and Habit Burger & Grill. This page splits Yum!’s revenue by division, with KFC first, because Yum! reports KFC as one of its four segments. KFC brought in $3,542M of Yum!’s $8,214M revenue in fiscal 2025.
Yum! Brands revenue by fiscal year, FY2021 to FY2025, from the company's filings. Chart: The Business Engineer.
Most of the money is fees. Franchise and property revenues were $1,807M, or 51.0% of KFC’s revenue. Yum! says franchisees pay “monthly continuing fees based on a percentage of their restaurants’ sales (typically between 4% to 6%)”. Master franchisees pay less. Yum China, its largest franchisee, pays a 3% licence fee on mainland China sales; KFC’s China franchise revenues were $274M.
Company-owned restaurants added $1,057M of sales (29.8%). Franchisee contributions to advertising co-operatives added $679M (19.2%), which Yum! books as revenue and then spends: KFC’s advertising and other services expense was $670M.
How KFC compares
KFC is Yum!’s largest division. It earned $1,503M of operating profit in fiscal 2025, 50.8% of the four divisions’ combined total on our calculation. Taco Bell earned $1,129M, Pizza Hut $340M, and Habit Burger & Grill lost $13M.
KFC’s restaurants are thin-margin; its fees are not. Company-owned KFCs made $128M of restaurant profit on $1,057M of sales, a 12.1% margin. Division operating profit equalled 42.4% of division revenue.
KFC Division revenue was $2,793M in fiscal 2021, $2,834M in 2022 and $2,830M in 2023, before rising to $3,099M in 2024 and $3,542M in 2025. Yum!’s consolidated revenue rose from $6,584M to $8,214M over the same five years.
What changed in FY2025
KFC revenue rose 14%. Company sales jumped 32% to $1,057M, mainly because of the U.K. and Ireland restaurants Yum! bought in the second quarter of 2024. Franchise and property revenues rose 7%, which Yum! attributes to unit growth and 2% franchise same-store sales growth.
Yum! Brands revenue by line, prior year against FY2025, as reported. Chart: The Business Engineer.
System sales grew 6% to $36,434M, and same-store sales rose 3% after a 2% fall in 2024. The unit count rose 6% to 33,897. Operating profit rose 10% to $1,503M.
In January 2025 Yum! ended its agreements with its Turkey franchisee, and 283 KFC restaurants closed. It had re-acquired the KFC and Pizza Hut master franchise rights in Germany in December 2024.
What to watch
China. Yum! says a meaningful portion of its business, “particularly with respect to our KFC Concept”, runs through Yum China, and that problems there could cut the licence fee it receives.
Franchisees. Growth depends on franchisees opening new restaurants and running them profitably. Yum! warns that distressed franchisees could hurt results and slow development.
Currency. 90% of KFC units are outside the U.S., and Yum! lists foreign currency risks and exchange controls as a risk factor. Exchange rates added $12M to KFC’s 2025 operating profit.
Frequently asked questions
How does KFC make money?
Mainly from franchise fees. In fiscal 2025, franchise and property revenues were $1,807M of the KFC Division’s $3,542M revenue. Company-owned restaurants added $1,057M and advertising contributions $679M.
Who owns KFC?
KFC is a division of Yum! Brands, Inc., which also owns Taco Bell, Pizza Hut and Habit Burger & Grill. KFC was Yum!’s largest division by revenue and operating profit in fiscal 2025.
How many KFC restaurants are there?
33,897 at the end of 2025, up 6%. Franchisees operated 99% of them, and 90% were outside the U.S.
Is KFC profitable?
Yes. The KFC Division reported operating profit of $1,503M in fiscal 2025, up 10% from $1,363M.
Families: Offering family-sized meal options that cater to group dining.
Individuals: Providing single-serving meals and combo options for individual customers.
Young Adults and Students:
Millennials and Gen Z: Attracted to KFCโs convenience, taste, and affordability.
Students: Frequently visit for quick meals and budget-friendly options.
Health-Conscious Consumers:
Balanced Options: Consumers looking for healthier alternatives can choose from KFCโs range of grilled chicken and salads.
Delivery and Takeaway Customers:
Busy Professionals: Individuals who prefer the convenience of delivery or takeaway.
Online Shoppers: Customers using KFCโs online ordering platforms for home delivery.
Revenue Streams
KFC generates revenue through several channels:
Franchise Operations:
Franchise Fees: Income from initial franchise fees and ongoing royalties based on a percentage of sales from franchisees.
Supply Chain Services: Revenue from selling ingredients and supplies to franchisees.
Company-Owned Stores:
Direct Sales: Revenue from sales at company-owned restaurants, offering the full menu range.
Product Sales:
Menu Items: Income from a diverse menu including fried chicken, burgers, wraps, sides, and beverages.
Promotions and Limited-Time Offers: Special promotions and seasonal items that drive additional sales.
Delivery Services:
Online Orders: Revenue from orders placed through KFCโs website, app, and third-party delivery services.
Partnerships: Collaborations with delivery platforms like UberEats, DoorDash, and Grubhub, where KFC earns a share of the delivery sales.
Market Strategy
KFCโs market strategy focuses on brand recognition, menu innovation, and global expansion.
Brand Recognition:
Colonel Sanders: Leveraging the iconic image and story of Colonel Sanders to build a strong brand identity.
Advertising: Extensive use of TV, online, and print advertising to maintain brand visibility.
Menu Innovation:
Product Development: Continuously updating the menu with new items, flavors, and limited-time offers to keep the menu fresh and appealing.
Healthier Options: Introducing grilled chicken and salads to attract health-conscious consumers.
Global Expansion:
New Markets: Entering new international markets through franchise partnerships.
Localization: Adapting the menu to local tastes and preferences in different regions.
Distribution Strategy
KFCโs distributionstrategy involves a mix of franchise and company-owned stores, along with digital platforms.
Franchise Model:
Global Presence: The majority of KFCโs restaurants are franchised, which helps the brand expand rapidly with lower capital expenditure.
Support and Training: Providing franchisees with extensive support, training, and resources to maintain quality and brand consistency.
Company-Owned Stores:
Direct Management: Company-owned stores allow KFC to directly manage operations, ensuring adherence to brand standards and testing new products and strategies.
Digital and Delivery Channels:
Online Ordering: Offering online ordering through the KFC website and mobile app for both delivery and pickup.
Third-Party Delivery Services: Partnering with third-party delivery platforms to extend reach and convenience for customers.
Competitive Advantages
KFCโs competitive advantages lie in its strong brand equity, global presence, and continuous innovation.
Brand Equity:
Strong Legacy: KFCโs long history and association with Colonel Sanders provide a strong brand identity that resonates with consumers globally.
Trust and Quality: Consistency in product quality and service builds consumer trust and loyalty.
Global Presence:
Widespread Locations: A vast network of restaurants in over 150 countries ensures brand visibility and accessibility.
Adaptability: Ability to adapt menus to local tastes while maintaining core offerings ensures relevance in diverse markets.
Continuous Innovation:
Menu Development: Regular introduction of new and innovative menu items keeps the brand fresh and appealing.
Technology Integration: Investment in digital platforms and delivery services enhances customer convenience and engagement.
CEO: The Chief Executive Officer is the top executive responsible for overall strategic direction and management of the company.
Senior Leadership Team: Comprising top executives overseeing various key functions such as operations, marketing, finance, and human resources.
Regional Management:
Regional Heads: KFC divides its operations into regions, each headed by a Regional President or Vice President. These regions can be based on geographic locations or specific markets.
Country Managers: Within each region, there are Country Managers or Directors responsible for overseeing KFC’s operations in individual countries or territories.
Corporate Functions:
Departments: KFC has various functional departments, including Operations, Marketing, Finance, Human Resources, Legal, and Supply Chain, among others.
Support Functions: These departments provide centralized support services, such as IT, Research and Development, and Quality Assurance.
Franchise Relations:
Franchise Development: Teams dedicated to recruiting new franchisees and expanding KFC’s franchise network.
Franchisee Support: Teams that offer training, operational support, and ongoing assistance to franchisees.
Restaurant-Level Organization:
Restaurant Management: Each KFC restaurant has its own management team, typically including a General Manager, Assistant Managers, and Shift Supervisors.
Staff: Restaurants employ front-line staff, including cooks, cashiers, and customer service representatives.
Leadership Style:
KFC’s leadership style is characterized by several key principles:
Customer-Centric Focus: KFC places a strong emphasis on meeting customer expectations by delivering quality food and service.
Operational Excellence: The company strives for operational efficiency and consistency across its global network of restaurants.
Innovation: KFC encourages innovation in menu offerings, marketing strategies, and restaurant operations to stay competitive in the fast-food industry.
Franchisee Collaboration: KFC maintains a collaborative relationship with its franchisees, valuing their contributions to the brand’s success.
Brand Loyalty: The leadership fosters brand loyalty by upholding KFC’s unique flavors, recipes, and traditions while adapting to changing consumer preferences.
Community Engagement: KFC engages with local communities through initiatives such as corporate social responsibility and philanthropy.
Global Perspective: KFC’s leadership recognizes the importance of understanding diverse market preferences and cultural nuances in different regions.
The major institutional shareholders comprise The Vanguard Group (8.83%) and BlackRock (7.1%). Major individual shareholders include Kevin Ozan (Executive Vice President and Chief Financial Officer), Stephen Easterbrook (President and CEO), and John Rogers, Jr., an investor, philanthropist, and Ariel Capital Management founder. And a few other individual shareholders.
McDonald’s is a heavy-franchised business model. In 2022, over 60% of the total revenues came from franchised restaurants. The company’s long-term goal is to transition toward 95% of franchised restaurants (by 2022, franchised restaurants were 94.7% of the total). The company generated over $23 billion in revenues in 2022, of which $8.75 billion was from owned restaurants and $14.1 billion from franchised restaurants.
Of over $23 billion in revenue in 2022, $8.74 came from company-operated stores, while $14.1 billion came from franchised restaurants. Of over $23 billion in revenue in 2021, McDonald’s generated almost ten billion dollars from company-operated restaurants, while it generated $13 billion from franchised restaurants.
In 2022, McDonald’s generated $6.18 billion in net profits, compared to $7.54 billion in 2021. The company runs a heavily franchised business model, where it has reached its target of 95% franchised restaurants worldwide.
McDonald’s finally transitioned to a heavily franchised business model in 2022, reaching its long-term objective of 95% of franchised restaurants vs. its total restaurants worldwide.
Approximately 95% of the restaurants at year-end 2022 were franchised, including 95% in the U.S., 89% in International Operated Markets, and 98% in the International Developmental Licensed Markets.
McDonald’s had 150,000 employees in 2022, compared to 200,000 employees in 2021 and the same in 2020. The company runs a heavily franchised business model, where most stores are franchised restaurants vs. owned ones. In 2022, McDonald’s franchised locations employed over two million individuals.
McDonald’s runs a heavily franchised business model, where most of its margins come from franchised restaurants vs. operated ones. For instance, in 2022, franchised restaurants generated $11.75 billion in margins vs. its operated restaurants, which generated $1.37 billion in margins.
Burger King is an American multinational chain of fast-food restaurants that is headquartered in Miami, Florida. The first Burger King restaurant, then known as Insta-Burger King, was opened in Jacksonville, Florida, in 1953 by Keith Cramer and his stepfather Matthew Burns. Burger King Worldwide merged with the Canadian coffee chain Tim Hortons in 2014. This precipitated the formation of parent company Restaurant Brands International, which is part-owned by former Burger King owner 3G Capital.
McDonaldโs has a divisional organizational structure where each division โ based on geographical location โ is assigned operational responsibilities and strategic objectives. The main geographical divisions are the US, internationally operated markets, and international developmental licensed markets. And on the other hand, the hierarchical leadership structure is organized around regional and functional divisions.
Franchising is a business model where the owner (franchisor) of a product, service, or method utilizes the distribution services of an affiliated dealer (franchisee). Usually, the franchisee pays a royalty to the franchisor to be using the brand, process, and product. And the franchisor instead supports the franchisee in starting up the activity and providing a set of services as part of the franchising agreement. Franchising models can be heavy-franchised, heavy-chained, or hybrid (franchained).
Coca-Cola follows a business strategy (implemented since 2006) where through its operating arm – the Bottling Investment Group – it invests initially in bottling partners operations. As they take off, Coca-Cola divests its equity stakes, and it establishes a franchising model, as long-term growth and distributionstrategy.
Coca-Cola’s Purpose is to “refresh the world. make a difference.” Its vision and mission are to “craft the brands and choice of drinks that people love, to refresh them in body & spirit. And done in ways that create a more sustainable business and better-shared future that makes a difference in peopleโs lives, communities, and our planet.”
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur, HackerNoon and Search Engine People. Find him on LinkedIn and Substack. See how we source.
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