Wendy’s Relaunches Breakfast, Plans To Hire 20,000 In US

DUBLIN, Ohio (AP) — Wendy’s said Monday it’s relaunching breakfast across the U.S. next year, the latest fast-food chain to amp up its offerings as more consumers eat out in the morning.

The Dublin, Ohio-based company said it will spend $20 million this year and help franchisees hire 20,000 employees so restaurants can extend their hours and menus. Wendy’s lowered its 2019 earnings forecast and withdrew its 2020 financial guidance, saying it will provide updated goals next month.

The company’s shares dropped 11% to $19.48 in afternoon trading.

Wendy’s now serves breakfast at 300 U.S. restaurants. It has around 5,800 locations nationwide.

Among other things, Wendy’s will offer a Frosty-ccino — a version of its ice cream with coffee in it — and a Breakfast Baconator, which has two kinds of cheese, sausage, bacon and eggs on a bun.

This will be Wendy’s fourth foray into the breakfast market; its most recent attempt was in 2012, when it tried serving steel-cut oatmeal and artisan breakfast sandwiches.

In a note to investors, Bernstein analyst Sara Senatore said breakfast is a difficult market for restaurants to crack because consumers’ breakfast habits are so ingrained. She also said franchisees may lose patience with the initial investment and hit to profits.

“We think the market is likely to be skeptical of this newest effort to offer breakfast given past failures,” Senatore wrote.

Still, restaurants are feeling pressure to compete at breakfast because it’s a growing category in an otherwise stagnant market. Over the last five years, breakfast is the only time of day that has seen steady year-over-year growth in the fast food industry, according to NPD Group, a consulting firm. In July, breakfast traffic was up 1% over last year; dinner traffic was flat.

Over the last few months, Panera Bread has revamped its breakfast menu and Burger King has offered a $5 monthly coffee pass.