Note 15 – Segment Reporting

The Company has two reportable segments: KFC and Pizza Hut. Our non-reportable operating segments, including the operations of Lavazza, Huang Ji Huang, Little Sheep, Taco Bell and our delivery operating segment, and for 2023 and 2024, our e-commerce segment, are combined and referred to as All Other Segments, as these operating segments are insignificant both individually and in the aggregate. The Company’s chief operating decision maker (“CODM”) is the chief executive officer, who reviews the financial information of each operating segment when making decisions about allocating resources and assessing the performance of the segment.


	2025
	KFC		Pizza Hut		All Other Segments				Corporate and Unallocated(a)				Combined			Elimination			Consolidated

Revenue from external customers	$	8,871	$	2,324	$	184			$	418		(b)	$	11,797		$	—		$	11,797
Inter-segment revenue(c)		—		—		750				—				750			(750	)		—
		8,871		2,324		934				418				12,547			(750	)		11,797

Less:
Food and paper		2,690		752		13				—				3,455			—			3,455
Payroll and employee benefits		2,338		640		11				—				2,989			(2	)		2,987
Occupancy and other operating expenses		2,175		598		21				—				2,794			—			2,794
General and administrative expenses		260		110		30				181				581			—			581
Franchise expenses		36		4		1				—				41			—			41
Expenses for transactions with franchisees		58		6		73				344		(b)		481			—			481
Other operating costs and expenses		3		23		783		(c)		71				880			(748	)		132
Closures and impairment expenses, net		26		8		3				—				37			—			37
Other income, net		—		—		—				(1	)			(1	)		—			(1	)

Operating Profit (Loss)		1,285		183		(1	)			(177	)			1,290			—			1,290

Interest income, net(a)										92										92
Investment loss(a)										(24	)									(24	)
Income Before Income Taxes and Equity in Net Earnings (Losses) from Equity Method Investments																			$	1,358


	2024
	KFC		Pizza Hut		All Other Segments				Corporate and Unallocated(a)				Combined			Elimination			Consolidated

Revenue from external customers	$	8,509	$	2,260	$	181			$	353		(b)	$	11,303		$	—		$	11,303
Inter-segment revenue(c)		—		—		608				—				608			(608	)		—
		8,509		2,260		789				353				11,911			(608	)		11,303

Less:
Food and paper		2,645		727		15				—				3,387			—			3,387
Payroll and employee benefits		2,146		628		15				—				2,789			(2	)		2,787
Occupancy and other operating expenses		2,170		600		28				—				2,798			—			2,798
General and administrative expenses		248		110		37				173				568			—			568
Franchise expenses		32		4		1				—				37			—			37
Expenses for transactions with franchisees		49		4		65				286		(b)		404			—			404
Other operating costs and expenses		8		22		635		(c)		63				728			(606	)		122
Closures and impairment expenses, net		19		12		8				—				39			—			39
Other income, net		—		—		—				(1	)			(1	)		—			(1	)

Operating Profit (Loss)		1,192		153		(15	)			(168	)			1,162			—			1,162

Interest income, net(a)										129										129
Investment gain(a)										40										40
Income Before Income Taxes and Equity in Net Earnings (Losses) from Equity Method Investments																			$	1,331


	2023
	KFC		Pizza Hut		All Other Segments				Corporate and Unallocated(a)				Combined		Elimination			Consolidated

Revenue from external customers	$	8,240	$	2,246	$	199			$	293		(b)	$	10,978	$	—		$	10,978
Inter-segment revenue(c)		—		—		580				—				580		(580	)		—
		8,240		2,246		779				293				11,558		(580	)		10,978

Less:
Food and paper		2,512		692		20				—				3,224		—			3,224
Payroll and employee benefits		2,057		649		21				—				2,727		(2	)		2,725
Occupancy and other operating expenses		2,107		610		35				—				2,752		—			2,752
General and administrative expenses		263		118		43				214				638		—			638
Franchise expenses		31		4		1				—				36		—			36
Expenses for transactions with franchisees		39		4		67				246		(b)		356		—			356
Other operating costs and expenses		15		19		614		(c)		42				690		(578	)		112
Closures and impairment expenses, net		12		8		9				—				29		—			29
Other expenses (income), net		2		—		—				(2	)			—		—			—

Operating Profit (Loss)		1,202		142		(31	)			(207	)			1,106		—			1,106

Interest income, net(a)										169									169
Investment loss(a)										(49	)								(49	)
Income Before Income Taxes and Equity in Net Earnings (Losses) from Equity Method Investments																		$	1,226


	Depreciation and Amortization
	2025		2024		2023
KFC	$	304	$	337	$	319
Pizza Hut		97		94		93
All Other Segments		7		8		9
Corporate and Unallocated		40		37		32
	$	448	$	476	$	453


	Impairment Charges
	2025		2024		2023
KFC(d)	$	29	$	27	$	18
Pizza Hut(d)		10		13		10
All Other Segments(d)		3		9		9
	$	42	$	49	$	37


	Capital Spending
	2025		2024		2023
KFC	$	302	$	383	$	358
Pizza Hut		89		111		113
All Other Segments		2		3		18
Corporate and Unallocated		233		208		221
	$	626	$	705	$	710


	Total Assets
	2025		2024
KFC	$	5,560	$	5,334
Pizza Hut		952		914
All Other Segments		308		300
Corporate and Unallocated(e)		3,963		4,573
	$	10,783	$	11,121

(a)

Amounts have not been allocated to any segment for performance reporting purposes.

(b)

Amounts from corporate and unallocated primarily include revenues and associated expenses of transactions with franchisees derived from the Company’s central procurement model whereby the Company centrally purchases substantially all food and paper products from suppliers then sells and delivers to KFC and Pizza Hut restaurants, including franchisees. Amounts have not been allocated to any segment for purposes of making operating decisions or assessing financial performance as the transactions are deemed corporate revenues and expenses in nature.

(c)

Primarily includes revenues and associated costs generated from the delivery services that were provided to our Company-owned restaurants.

(d)

Primarily includes store closure impairment charges and restaurant-level impairment charges resulting from our semi-annual impairment evaluation. See Note 10 for more information.

(e)

Primarily includes cash and cash equivalents, short-term investments, long-term bank deposits and notes, equity investments, and inventories that are centrally managed and PP&E that are not specifically identifiable within each segment.

As substantially all of the Company’s revenue is derived from the PRC and substantially all of the Company’s long-lived assets are located in the PRC, no geographical information is presented. In addition, revenue derived from and long-lived assets located in the U.S., the Company’s country of domicile, are immaterial.

Historical Timeline

Fiscal Year	Filed
2025	Feb 27, 2026	Showing above
2024	Feb 27, 2025

2023	Feb 29, 2024

2022	Mar 1, 2023

2021	Feb 28, 2022

2020	Feb 26, 2021

2019	Feb 27, 2020

2018	Feb 27, 2019

2017	Feb 27, 2018

2016	Mar 8, 2017

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Yum China Holdings, Inc. Segments Disclosure

Historical Timeline

About Segments Disclosures

Other Available Disclosures