Wendy’s adds to restaurant pullback on ‘challenging’ U.S. market

Wendy’s Co. lowered its sales outlook for this year, the latest restaurant chain to take a hit from consumer unease about shaky economic conditions in the U.S.

Global systemwide sales are set to decline as much as 2%, while the company had forecast in March an increase as large as 3%. The cut follows a steeper-than-expected sales drop for established restaurants in the first quarter, mostly due to weakness in the U.S.

The U.S. faced a “challenging consumer environment,” Chief Executive Officer Kirk Tanner said in an earnings announcement, though he pointed to Wendy’s holding traffic and dollar share.

Wendy’s results illustrate how the trade war is denting consumer sentiment and prompting diners to cut back on restaurant outings to save money. McDonald’s Corp. warned earlier this week that the apprehension lower-income consumers have been feeling has extended to middle-income customers, while Chipotle Mexican Grill Inc. said Americans are worried about issues such as tariffs.

The square-burgermaker has been working on a range of strategies to bring in diners in more frequently, including expanding core offerings such as its Frosty frozen dessert. It’s also focusing on new chicken and beverage products, two categories that competitors are targeting.

Another project involves launching buzzy collaborations, such as last year’s successful Krabby Patty meal celebrating SpongeBob’s 25th birthday.

Wendy’s reaffirmed its goal to increase locations by as much as 3% net in 2025, and for capital expenditures to be in a range of $100 million to $110 million.