Burger King-parent Restaurant Brands' quarterly results miss on weak demand

By Anuja Bharat Mistry

May 8 (Reuters) - Restaurant Brands QSR.N QSR.TO missed first-quarter revenue and profit estimates on Thursday, hurt by sluggish demand at its restaurant chains such as Burger King and Tim Hortons amid tariff-related uncertainty.

The restaurant industry has been battling ongoing sales declines as budget-conscious Americans stick to home-cooked meals, prioritizing spending on essentials over dining out.

The U.S. economy shrank for the first time in three years in the first quarter, signaling consumers are expecting product prices to shoot up due to the escalating global trade tensions.

The Trump administration's shifting tariff policies have forced businesses to raise prices in an effort to protect profit margins from rising input costs and supply chain disruptions.

Fast-food chain operators such as McDonald's MCD.N, Domino's DPZ.N, Chipotle CMG.N and Starbucks SBUX.O took a hit to sales and flagged weak consumer demand.

"We anticipated that Q1 would be our softest quarter of the year and believe that some of the macro noise may have driven further softness," Restaurant Brands CEO Josh Kobza said on a post-earnings call.

Comparable sales at the company's Tim Hortons segment, its biggest revenue generator, dipped 0.1% in the quarter, while at Burger King it fell 1.3%.

"Surprised by the Tim Hortons miss in the context of peers that cited strength in Canada including McDonald's, Starbucks, Wendy's & Yum!, while the brand was a theoretical beneficiary of the 'Buy Canadian movement'," Andrew Charles, analyst with TD Cowen Securities, said.

Rising prices of commodities such as coffee pushed up its supply chain costs, according to Restaurant Brands.

The company reported quarterly revenue of $2.11 billion, compared with analysts' average expectation of $2.13 billion, according to data compiled by LSEG.

On an adjusted basis, Restaurant Brands earned 75 cents per share, missing estimates of 78 cents.