Sapphire Foods Reports Q1 Loss Despite Revenue Growth

Mumbai, July 23 — Sapphire Foods India, which operates popular fast-food chains like KFC and Pizza Hut, reported a net loss of Rs 1.73 crore for the first quarter (Q1) of FY26, ending June 30. This is a sharp fall compared to a net profit of Rs 8.18 crore during the same period last year.

The company’s revenue from operations grew by 8.16% year-on-year to Rs 776.8 crore. Total income also increased by 8.31% to Rs 783.6 crore, up from Rs 723.5 crore in Q1 FY25.

However, expenses rose faster by 10.4%, reaching Rs 785.4 crore compared to Rs 711.7 crore a year ago, putting pressure on profitability.

Fast-food chains like KFC and Pizza Hut have been struggling in India as customers reduce discretionary spending due to rising living costs. To attract buyers, these brands launched aggressive discount offers. KFC promoted its “epic savers” deal with nine pieces of fried chicken for Rs 299, while Pizza Hut offered free Pepsi with select pizzas.

Despite these promotions, same-store sales at KFC remained flat, and Pizza Hut saw an 8% decline in India. Although popular, these deals did not significantly boost foot traffic or sales growth.

On a positive note, Sapphire Foods expanded by opening dozens of new outlets over the past year. This helped push overall revenue higher despite challenges in core business metrics like profitability and same-store sales.

Sapphire Foods is one of the two franchisees of Yum Brands in India and operates hundreds of KFC and Pizza Hut outlets nationwide.