What happened

Taco Bell, KFC, and Pizza Hut parent Yum! Brands (NYSE:YUM) saw its shares fall as much as 5.9% on Wednesday, following the company's first-quarter earnings release. At 12:30 p.m. EDT, shares were down 5.5%.

Though Yum! Brands beat the consensus analyst estimate for both revenue and earnings per share, same-store shares fell short of expectations. In addition, management expects supplier shortages to weigh on its second quarter.

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Image source: Getty Images.

So what

Yum! Brands' first-quarter earnings per share, when excluding special items, was $0.90 -- up 38% year over year. On average, analysts were expecting adjusted earnings per share of $0.68. Sales for the period fell 3% year over year, to $1.37 billion. On average, investors were expecting sales of about $1.1 billion.

Yum! Brands' same-store sales, or sales at stores open for more than one year, increased 1% year over year on a consolidated basis -- lower than same-store sales growth in recent quarters. KFC same-store sales increased 2%, and Pizza Hut and Taco Bell both saw same-store sales increase 1%. On average, analysts had expected same-store sales growth of 2%. Same-store sales during the quarter were negatively impacted by supply issues in the United Kingdom, management said.

Now what

Looking ahead to its second quarter, KFC's CFO warned during the company's first-quarter earnings call that supply shortages for its KFC division in the United Kingdom also will negatively impact its second quarter, likely making the period "the worst" quarter of the year, according to Reuters.

Despite this challenging environment in the U.K., Yum! Brands is maintaining all aspects of its full-year 2018 guidance.

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