by JIANG Yiman

Yum China said on Monday it will expand Pizza Hut's footprint, targeting more than 6,000 outlets by 2028, up from about 4,000 today. The company plans to add over 600 net new stores annually for the next three years and increase the share of franchised units.

Pizza Hut currently covers around 1,000 cities, while about 1,500 cities have a KFC but no Pizza Hut, offering significant room for rollout.

Yum China said it expects to return nearly all free cash flow to shareholders from 2027 after minority payouts, with shareholder returns projected to exceed US$1 billion in 2028. It also forecast KFC to generate 10 billion yuan (US$1.4billion) in operating profit that year, while Pizza Hut is expected to double operating profit by 2029 from 2024 levels.

The company reaffirmed its plan to reach 20,000 stores in 2026 and push toward 30,000 by 2030.

Yum China — spun off from Yum! Brands in 2016 and headquartered in Shanghai — operates more than 17,500 restaurants across over 2,200 Chinese cities and towns. It holds the exclusive mainland China rights to KFC, Pizza Hut and Taco Bell, and runs Chinese dining brands Little Sheep and Huang Ji Huang, as well as Lavazza cafés in partnership with the Italian coffee group. The company has also developed in-house brands such as KCOFFEE and K PRO.

The update comes as Yum! Brands conducts a strategic review of its global Pizza Hut business. Yum China CFO DING Xiao declined to comment on the process, citing corporate independence, but said the company remains confident in Pizza Hut’s China prospects.

Yum China reported US$3.2 billion in third-quarter revenue, up 4% year on year, with operating profit rising 8% to US$400 million. Same-store sales increased 1%, marking an 11th straight quarter of traffic growth. The company added 536 net new stores in the quarter. As of September 30, it operated 17,514 restaurants nationwide.