Revenue (Tables)

9 Months Ended

Oct. 01, 2023

The following tables disaggregate revenue by segment and source:


	Wendy’s U.S.		Wendy’s International		Global Real Estate & Development		Total
Three Months Ended October 1, 2023
Sales at Company-operated restaurants	$	227,674	$	7,047	$	—	$	234,721
Franchise royalty revenue	112,698		17,390		—		130,088
Franchise fees	17,079		1,597		581		19,257
Franchise rental income	—		—		57,567		57,567
Advertising funds revenue	99,789		9,133		—		108,922
Total revenues	$	457,240	$	35,167	$	58,148	$	550,555

Three Months Ended October 2, 2022
Sales at Company-operated restaurants	$	225,245	$	3,541	$	—	$	228,786
Franchise royalty revenue	108,780		15,777		—		124,557
Franchise fees	15,294		1,257		625		17,176
Franchise rental income	—		—		58,463		58,463
Advertising funds revenue	96,615		6,972		—		103,587
Total revenues	$	445,934	$	27,547	$	59,088	$	532,569


	Wendy’s U.S.		Wendy’s International		Global Real Estate & Development		Total
Nine Months Ended October 1, 2023
Sales at Company-operated restaurants	$	685,168	$	18,190	$	—	$	703,358
Franchise royalty revenue	333,958		50,408		—		384,366
Franchise fees	51,812		4,515		3,377		59,704
Franchise rental income	—		—		173,407		173,407
Advertising funds revenue	296,043		24,049		—		320,092
Total revenues	$	1,366,981	$	97,162	$	176,784	$	1,640,927

Nine Months Ended October 2, 2022
Sales at Company-operated restaurants	$	659,649	$	9,281	$	—	$	668,930
Franchise royalty revenue	315,572		45,743		—		361,315
Franchise fees	46,685		3,695		2,450		52,830
Franchise rental income	—		—		174,944		174,944
Advertising funds revenue	281,779		19,197		—		300,976
Total revenues	$	1,303,685	$	77,916	$	177,394	$	1,558,995

Contract Balances, assets and liabilities

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


	October 1, 2023 (a)		January 1, 2023 (a)
Receivables, which are included in “Accounts and notes receivable, net” (b)	$	54,931	$	54,497
Receivables, which are included in “Advertising funds restricted assets”	66,676		70,422
Deferred franchise fees (c)	99,889		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 $10,526 and $89,363, respectively, as of October 1, 2023, and $8,977 and $90,231, respectively, as of January 1, 2023.

Contract Balances, deferred franchise fee rollforward

Significant changes in deferred franchise fees are as follows:


	Nine Months Ended
	October 1, 2023		October 2, 2022
Deferred franchise fees at beginning of period	$	99,208	$	97,186
Revenue recognized during the period	(9,016)		(7,193)
New deferrals due to cash received and other	9,697		10,143
Deferred franchise fees at end of period	$	99,889	$	100,136

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)	$	6,332
2024	6,090
2025	5,908
2026	5,797
2027	5,689
Thereafter	70,073
	$	99,889

_______________

(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.