Taco Bell, which moved quickly this month to remove iceberg lettuce linked to the widespread cyclospora outbreak in the United States, said on Thursday that customers were starting to return to its restaurants.
The chain became the early face of the outbreak, and federal regulators now attribute 1,947 cases of cyclosporiasis in nine states to iceberg lettuce that was served at Taco Bells. The lettuce had been supplied by Taylor Farms, the country’s largest produce provider, and health officials said they found evidence that tied the outbreak to the company’s operations in Mexico. Officials at the Food and Drug Administration said they believed there were multiple outbreaks occurring in the United States that were not all linked to Taco Bell.
Sales at Taco Bell dropped in the days after it made public that it was pulling all of the iceberg lettuce that Taylor Farms supplied to its restaurants. The lettuce was quickly replaced by a new supplier.
On Thursday morning, executives at Yum Brands, which owns Taco Bell, said the restaurant chain was showing signs of moving past the incident. After an initial drop in the early days of the news around the outbreak, sales at its Taco Bell stores have stabilized and are down 2 percent, the company said.
“The sales impact will be temporary, and we appreciate our fans who are coming back and showing their love for Taco Bell,” Chris Turner, the chief executive of Yum Brands, told Wall Street analysts and investors on an earnings call early Thursday.
Taco Bell has outperformed many of its fast-food peers in recent years through a combination of unique Mexican-inspired food offerings, a robust value meal platform and a huge fan base.
Before the outbreak, it was a driving force in Yum Brands’ overall growth. In addition to Taco Bell, Yum Brands owns KFC, Pizza Hut and the Habit Burger & Grill, a fast-casual chain.
Overall sales at Yum Brands stores open for at least a year rose 3 percent in the quarter ending June 30 compared with the same period a year ago. Much of that growth came from Taco Bell, which reported a 7 percent jump in same-store sales.
Same-store sales at KFC rose 2 percent in the quarter, while Yum Brands’ struggling Pizza Hut division continued to drag down on the company’s overall performance with a 1 percent decline in same-store sales.
In June, Yum Brands announced plans to sell Pizza Hut to two firms for $2.7 billion.
Revenue at Yum Brands rose 12 percent to $2.17 billion in the quarter while operating profit increased 5 percent to $655 million.
Shares of Yum Brands rose more than 3 percent in early trading, to $156.66.
Cyclosporiasis, an intestinal illness caused by a parasite transmitted through food or water contaminated with human feces, tends to hit in the summertime. The number of cases in the United States this year has reached record levels.
The Centers for Disease Control and Prevention has confirmed or is investigating more than 18,000 cases in 45 states and it has reported 423 hospitalizations.
Executives at Yum Brands said that while Taco Bell’s sales were down significantly in the days after the company announced it pulled lettuce from its stores, transparency has helped the company quickly regain consumer trust.
“Consumers have become increasingly aware that this is an industrywide issue, not an issue specific to Taco Bell,” Mr. Turner said. “The team’s swift and transparent action reinforced trust in the brand. As evidence of those factors, Taco Bell’s measures of social sentiment have already returned to pre-issue levels of positivity.”
Hoping to lure customers back, Taco Bell has also been leaning into big promotions for its rewards members, including offering a $1 lettuce-free Enchirito (an enchilada and burrito mash-up) last week and a $1 Mexican Pizza deal this week.
“The Mexican Pizza drop this Tuesday generated the most app traffic, the most app transactions,” of any Tuesday drop ever, Mr. Turner said. “And, in fact, we saw positive transaction growth.”
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