Yum Brands on Wednesday said that Taco Bell reported 7% same-store sales growth in the fourth quarter of last year.
If that sounds familiar, it’s because it is. Taco Bell is one of the restaurant industry’s most consistent growth stories. Its same-store sales have risen 5% or more in nine of 16 quarters dating to the first quarter of 2022. They have decreased just one quarter—the pandemic quarter in 2020—since 2016.
For the full year, the Mexican fast-food chain’s same-store sales increased 7%, a particularly impressive number given the state of the overall restaurant economy. The brand gained domestic market share among a broad range of consumers, including higher-income diners, families and younger customers, Chris Turner, CEO of Taco Bell parent company Yum Brands, told analysts on Wednesday.
“Taco Bell continues to play in a category of one,” Turner told analysts.
The company’s transaction growth last quarter was nearly 5 points ahead of the fast-food business, executives said, and that growth came from customers “at all income bands.” It was particularly strong among younger consumers age 18 to 24.
“We’re taking share broadly from a broad range of competitors,” Turner said. “It tells us that Taco Bell marketing and value are really resonating.”
Taco Bell’s 7% same-store sales growth stands in contrast to the performance of another limited-service Mexican chain, Chipotle, where same-store sales declined 2.5% last quarter and the company kept modest its expected performance for 2026.
Yum Brands executives have set aggressive goals for its Mexican brand for the coming years, including $3 million average unit volumes by 2030 and restaurant-level profit margins of 25% to 26%. The chain is already close to the margins the company wanted, having reported 24.4% U.S. restaurant margins last quarter despite higher beef prices.
The chain will require a bit more growth to get to the AUV target. Taco Bell currently generates about $2.3 million in sales per location.
“They have a really cool brand that is incredibly relevant in culture,” Turner said. “They’re providing creative ability. They’re providing tremendous value and a convenient experience. Some other brands can do one or two of those things, but Taco Bell does all four of those things incredibly well. That’s why they’re winning.”
Taco Bell’s consistent performance over the years has turned it into the dominant fast-food Mexican brand. It is more than 10 times bigger than its nearest competitor.
The company has been slower growing outside the U.S. but Yum Brands is also targeting more locations internationally. The company wants 3,000 restaurants outside the U.S. by 2030, which would more than double the brand’s international presence.
The company opened five new markets and is now in 26 countries and has at least 10 locations in India, the U.K., Thailand, Brazil, Spain and Canada.
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