Revenue (Tables)

6 Months Ended

Jul. 03, 2022

The following tables disaggregate revenue by segment and source:


	Wendy’s U.S.		Wendy’s International		Global Real Estate & Development		Total
Three Months Ended July 3, 2022
Sales at Company-operated restaurants	$	227,903	$	2,966	$	—	$	230,869
Franchise royalty revenue	108,872		16,141		—		125,013
Franchise fees	15,986		1,167		1,270		18,423
Franchise rental income	—		—		58,610		58,610
Advertising funds revenue	97,679		7,189		—		104,868
Total revenues	$	450,440	$	27,463	$	59,880	$	537,783

Six Months Ended July 3, 2022
Sales at Company-operated restaurants	$	434,404	$	5,740	$	—	$	440,144
Franchise royalty revenue	206,792		29,966		—		236,758
Franchise fees	31,391		2,438		1,825		35,654
Franchise rental income	—		—		116,481		116,481
Advertising funds revenue	185,164		12,225		—		197,389
Total revenues	$	857,751	$	50,369	$	118,306	$	1,026,426

Three Months Ended July 4, 2021
Sales at Company-operated restaurants	$	193,279	$	246	$	—	$	193,525
Franchise royalty revenue	106,006		13,560		—		119,566
Franchise fees	14,331		1,454		1,310		17,095
Franchise rental income	—		—		60,868		60,868
Advertising funds revenue	96,227		6,056		—		102,283
Total revenues	$	409,843	$	21,316	$	62,178	$	493,337

Six Months Ended July 4, 2021
Sales at Company-operated restaurants	$	382,336	$	246	$	—	$	382,582
Franchise royalty revenue	202,770		25,130		—		227,900
Franchise fees	26,261		2,897		2,433		31,591
Franchise rental income	—		—		119,744		119,744
Advertising funds revenue	180,430		11,293		—		191,723
Total revenues	$	791,797	$	39,566	$	122,177	$	953,540

Contract balances, assets and liabilities

The following table provides information about receivables and contract liabilities (deferred franchise fees) from contracts with customers:


	July 3, 2022 (a)		January 2, 2022 (a)
Receivables, which are included in “Accounts and notes receivable, net” (b)	$	57,838	$	49,168
Receivables, which are included in “Advertising funds restricted assets”	66,918		65,497
Deferred franchise fees (c)	99,108		97,186

_______________

(a)Excludes funds collected from the sale of gift cards, which are primarily reimbursed to franchisees upon redemption at franchised restaurants and do not ultimately result in the recognition of revenue in the Company’s condensed consolidated statements of operations.

(b)Includes receivables related to “Sales” and “Franchise royalty revenue and fees.”

(c)Deferred franchise fees are included in “Accrued expenses and other current liabilities” and “Deferred franchise fees” and totaled $9,862 and $89,246, respectively, as of July 3, 2022, and $9,084 and $88,102, respectively, as of January 2, 2022.

Deferred franchise fee rollforward

Significant changes in deferred franchise fees are as follows:


	Six Months Ended
	July 3, 2022		July 4, 2021
Deferred franchise fees at beginning of period	$	97,186	$	97,785
Revenue recognized during the period	(5,037)		(6,845)
New deferrals due to cash received and other	6,959		7,469
Deferred franchise fees at end of period	$	99,108	$	98,409

Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction

The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period:


Estimate for fiscal year:
2022 (a)	$	6,831
2023	6,440
2024	6,260
2025	6,084
2026	5,975
Thereafter	67,518
	$	99,108

_______________

(a)Represents franchise fees expected to be recognized for the remainder of 2022, which includes development-related franchise fees expected to be recognized over a duration of one year or less.