Wendy's slashes menu and tests new Frosty formula amid steep sales drop
The burger chain reported a 5.7% decline in U.S. same-store sales for the third quarter, prompting a major operational overhaul under new leadership.
By Fatima Saleh ·
Wendy's customers may notice different textures at the drive-thru as the company attempts to reverse a seven-quarter slide in sales. The fast-food giant reported on Thursday, Nov. 5, that U.S. same-restaurant sales fell 5.7 percent during the third quarter of 2026. This decline contributed to a 7.6 percent drop in U.S. systemwide sales and a 5.9 percent drop in global systemwide sales.
Financial results show the strain on the business. The company recorded quarterly revenue of $547 million, yet net income plummeted nearly 66 percent to $15.1 million. Fewer customers, rising costs, and increased competition continue to weigh on the chain's performance.
The struggle follows a period of aggressive cost-cutting. Wendy's previously announced plans to close up to 358 underperforming U.S. restaurants in 2026. This follows approximately 240 closures in 2024. The latest earnings report marks the seventh consecutive quarter of declining sales for the brand.
Bob Wright, who assumed the role of President and CEO in May, is leading a turnaround strategy named Dave's Way. The plan honors the company's founder, Dave Thomas. Wright stated in a release that he is encouraged by how quickly the system has aligned with the new multi-year business strategy. He noted the approach is rooted in the values and standards established by Thomas.
The operational changes aim to improve food quality, simplify kitchen tasks, and strengthen marketing. Wendy's is currently testing creamier Frostys, thicker and crispier bacon, and whole-leaf lettuce on sandwiches. The chain also intends to remove less popular menu items to boost kitchen efficiency and speed up service.
Breakfast operations will also shift. Instead of mandating a breakfast menu at every location, the company is granting franchisees more flexibility. Operators can now decide if the morning menu is financially viable for their specific restaurants. The chain is also working to improve its digital ordering experience and focus on better value for customers.
Wright told investors on Thursday that the company is seeing encouraging results from these early changes. The strategy focuses on giving customers more reasons to return while streamlining back-of-house processes.
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