Wendy's Stock Slumps After Dividend Cut and Guidance Withdrawal

Wendy's (WEN) stock plummeted 2.6% in premarket trading on Friday after the company announced a significant cut to its quarterly dividend and withdrew its full-year guidance for 2026.

The fast-food chain reduced its quarterly dividend from 14 cents to 7 cents per share, citing that the move would free up capital for its turnaround plan. CEO Bob Wright stated that the company has identified five areas of improvement, including rebuilding menus and improving marketing.

Wendy's reported a decline in U.S. same-restaurant sales by 7% in Q2, worse than the expected 4.7% drop. The company also closed a net 81 U.S. restaurants in the quarter, with global systemwide sales declining 6.5%, driven by an 8.2% fall in the U.S.

Despite the weak traffic numbers, Wendy's managed to beat on the bottom line, reporting adjusted EPS of $0.18, which topped estimates. However, adjusted EBITDA came in at $124.1 million, down 15.4% from a year ago.