Revenue

6 Months Ended

Jul. 02, 2023

Revenue [Abstract]

Revenue

Revenue

Disaggregation of Revenue

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 2, 2023
Sales at Company-operated restaurants	$	234,862	$	5,826	$	—	$	240,688
Franchise royalty revenue	114,921		17,207		—		132,128
Franchise fees	17,461		1,395		2,064		20,920
Franchise rental income	—		—		58,033		58,033
Advertising funds revenue	101,509		8,287		—		109,796
Total revenues	$	468,753	$	32,715	$	60,097	$	561,565
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

	Wendy’s U.S.		Wendy’s International		Global Real Estate & Development		Total
Six Months Ended July 2, 2023
Sales at Company-operated restaurants	$	457,494	$	11,143	$	—	$	468,637
Franchise royalty revenue	221,260		33,018		—		254,278
Franchise fees	34,733		2,918		2,796		40,447
Franchise rental income	—		—		115,840		115,840
Advertising funds revenue	196,254		14,916		—		211,170
Total revenues	$	909,741	$	61,995	$	118,636	$	1,090,372
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

Contract Balances

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

	July 2, 2023 (a)		January 1, 2023 (a)
Receivables, which are included in “Accounts and notes receivable, net” (b)	$	57,305	$	54,497
Receivables, which are included in “Advertising funds restricted assets”	71,927		70,422
Deferred franchise fees (c)	100,239		99,208

_______________

(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)The current portion of deferred franchise fees is included in “Accrued expenses and other current liabilities” and the long-term portion of deferred franchise fees is included in “Deferred franchise fees” and totaled $10,510 and $89,729, respectively, as of July 2, 2023, and $8,977 and $90,231, respectively, as of January 1, 2023.

Significant changes in deferred franchise fees are as follows:

	Six Months Ended
	July 2, 2023		July 3, 2022
Deferred franchise fees at beginning of period	$	99,208	$	97,186
Revenue recognized during the period	(6,591)		(5,037)
New deferrals due to cash received and other	7,622		6,959
Deferred franchise fees at end of period	$	100,239	$	99,108

Anticipated Future Recognition of Deferred Franchise Fees

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:
2023 (a)	$	8,092
2024	5,979
2025	5,821
2026	5,690
2027	5,609
Thereafter	69,048
	$	100,239

_______________

(a)Represents franchise fees expected to be recognized for the remainder of 2023, which includes development-related franchise fees expected to be recognized over a duration of one year or less.