Sandwich chain Subway's sales climb as turnaround takes hold ahead of potential sale

Subway said its same-store income climbed 9.2% successful 2022, signaling the sandwich chain's turnaround is taking clasp arsenic it reportedly explores a sale.

The institution is not required to disclose its fiscal results due to the fact that it's privately owned. However, Subway has precocious shared periodic income updates arsenic it has undertaken a turnaround. Those announcements could entice imaginable buyers to measurement forward.

The Wall Street Journal reported successful January that Subway hired advisors to research a merchantability that could worth the concatenation astatine much than $10 billion. In a connection to CNBC, Subway said it doesn't remark connected ownership operation and concern plans due to the fact that it's a privately held company.

CEO John Chidsey said successful a connection Thursday that the concatenation has acceptable 2 years of grounds income and is "getting its swagger back." Subway has seen 8 consecutive quarters of income growth, and integer income person much than tripled since 2019, the institution said successful a release. Its North American locations' same-store income jumped 7.8% successful 2022, breaking decade-old mean play income records, according to Subway.

The inclination reverses years of income declines for the once-ubiquitous sandwich chain, which was astatine 1 clip the largest U.S. edifice institution by fig of locations. Its U.S. footprint fell to 21,147 outlets successful 2021, down 22% from its highest of 27,103 successful 2015, according to franchise disclosure documents.

Even earlier the decease of co-founder Fred DeLuca and the high-profile proceedings of erstwhile spokesperson Jared Fogle, some successful 2015, Subway struggled to support up with caller fast-casual competitors similar Chipotle and cannibalized its ain income by opening excessively galore locations. As income slid, disfigured fights with franchisees played retired successful courts and splashed crossed headlines.

Chidsey took the reins successful precocious 2019, becoming the archetypal imperishable person of Subway who wasn't related to a founder. In the summertime of 2021, the concatenation announced it was overhauling its menu, upgrading its ingredients and boosting advertisement spending to lure backmost customers.

Its attempted comeback coincides with a tough environment for the broader edifice industry. After the lifting of pandemic lockdowns, eateries person had to cope with a shortage of willing workers, proviso concatenation snarls and climbing constituent costs. Many person raised prices successful response.

Subway didn't disclose Thursday however overmuch price hikes person contributed to its caller income maturation but told CNBC that its terms increases are "in enactment with" those by different fast-food chains.

Looking up to 2023, Subway plans to amended franchisee profitability and remodel 3,600 North American locations. Outside of its location market, the institution has commitments from maestro franchisees to unfastened 5,300 caller locations.

The institution volition besides soon beryllium half-owned by a foundation — connected Tuesday, Subway co-founder Peter Buck's foundation announced that helium near his 50% ownership of the sandwich concatenation to the organization. Buck died successful November 2021.

It's unclear whether that volition person an interaction connected a imaginable sale.