Wendy’s has lost its place as America’s runner-up to McDonald’s, ending a six-year run as the second-largest burger chain, being surpassed by a resurgent Burger King.
Burger King reclaimed the No. 2 position as its U.S. turnaround gains momentum, with domestic same-store sales jumping 8.5% in the second quarter. Wendy’s, meanwhile, reported a 7% decline in U.S. same-store sales, marking its sixth consecutive quarter of contraction.
Wendy’s new CEO Bob Wright acknowledged the chain’s problems Friday, saying its competitive edge has weakened as customers have pulled back.
“Today we are clearly not performing at our potential,” he wrote in a statement.
BURGER KING UNVEILS ‘WHOPPER GUARANTEE’ WITH FREE BURGER IF ORDER MISSES THE MARK
“Our traffic, our value proposition and franchisee economics are not meeting our expectations. We have already begun taking action across five areas that we’ve identified to drive the turnaround: rebuilding a quality menu at compelling value, marketing that drives demand, operational excellence, a digital experience that builds frequency, and restaurants as an engine for growth.”
McDonald’s remains the dominant U.S. burger chain by a wide margin, leaving Burger King and Wendy’s fighting for a distant second place.
Wendy’s had surpassed Burger King roughly six years ago, helped by the successful nationwide rollout of its breakfast menu. But its hold on the No. 2 spot has eroded as Burger King poured money into improving restaurants, advertising and its core menu.
Restaurant Brands International, Burger King’s parent company, launched a broad U.S. turnaround effort in late 2022 after sluggish sales. The strategy has included restaurant remodels, increased marketing spending and changes intended to improve food quality and the customer experience.
BURGER KING’S IMPOSSIBLE WHOPPER TO HIT MENUS ACROSS THE US
More recently, Burger King has focused on its signature Whopper.
The chain revamped the burger earlier this year, making changes to its bun, packaging, mayonnaise and other elements. Burger King U.S. and Canada President Tom Curtis told The Wall Street Journal that the improvements are helping bring customers back.
“A lot of people are saying they’re coming back for the first time in a long time,” Curtis said.
Burger King has also introduced a Whopper quality guarantee, pledging to remake an order if a customer is unhappy with it and provide another Whopper free on a future visit.
BURGER KING BRINGS BACK FAN FAVORITE FOR THE FIRST TIME IN 15 YEARS
“When we asked guests where we could do better, they gave us a lot of honest feedback, and now it’s our responsibility to act on it,” Curtis wrote in a statement in July. “We’re not going to get everything right every single time, but we’re committed to listening intently and improving every day.
“When guests choose us, they expect high-quality food, orders made the way they asked, and a team that’s there when they need us. That’s what these changes are about. We’re raising the standard in our restaurants, so every Guest feels like they made the right choice.”
Curtis said the chain believes it is taking market share from competitors, including potentially McDonald’s, and sees an opportunity to turn newly won customers into regulars.
“The next generation of burger lovers are being exposed to Burger King, and that means we’ve got runway ahead for years to come,” Curtis told the Journal.
MCDONALD’S SAYS US SALES SLOWED AFTER VALUE DEAL PUSH FELL SHORT
The gains underscore a sharp reversal in fortunes for two longtime rivals that have wrestled with many of the same pressures in recent years.
Both companies navigated the COVID-19 pandemic, supply-chain disruptions and rising food and labor costs before confronting increasingly price-conscious consumers frustrated by years of restaurant menu inflation.
Burger King responded with its multiyear turnaround campaign. Wendy’s, by contrast, has faced leadership turnover just as restaurant traffic weakened and beef costs added pressure to its business.
Longtime Wendy’s CEO Todd Penegor retired in 2024 after eight years at the helm. Former PepsiCo executive Kirk Tanner succeeded him but left a little more than a year later to become CEO of Hershey.
WENDY’S, MCDONALD’S LAWSUIT CLAIMS BURGER ADS MISLEAD CONSUMERS ON PATTY SIZES
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MCD | MCDONALD’S CORP. | 274.48 | -1.78 | -0.64% |
| QSR | RESTAURANT BRANDS INTERNATIONAL INC. | 73.89 | +0.97 | +1.33% |
| WEN | THE WENDY’S CO. | 7.69 | +0.30 | +4.06% |
| SHAK | SHAKE SHACK | 71.13 | +0.89 | +1.27% |
| JACK | JACK IN THE BOX INC. | 17.58 | +0.20 | +1.15% |
| YUM | YUM! BRANDS INC. | 150.76 | -1.52 | -1.00% |
Wendy’s CFO Ken Cook then served as interim chief executive before the company named Wright, the former CEO of Potbelly, to the permanent job in May.
“I returned to Wendy’s because I believe we can fix our issues and I am excited to work with our team and our franchisees to drive a strong turnaround,” Wright wrote in Friday’s release of second quarter results.
He said Wendy’s recent problems have hurt customer traffic and put pressure on restaurant economics, an increasingly important issue for a largely franchised chain whose operators must absorb higher costs while competing aggressively for value-conscious diners.
Burger King’s improvement also comes as McDonald’s works through challenges in its own U.S. operation. McDonald’s has been revamping its burgers, testing new menu items and looking for ways to improve food quality, service and value.
Still, Burger King’s move ahead of Wendy’s does not put it close to overtaking the Golden Arches.
McDonald’s accounted for about 48% of the U.S. burger market in 2024, according to Barclays data. Wendy’s held an estimated 11.4% share at the time, compared with about 10% for Burger King.
Read the full article here
