Fast food

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🥤 Fast food's thirst trap

Illustration: Brendan Lynch/Axios

Fast-food giants and coffee chains are racing to reinvent their drink menus — betting beverages can drive visits — no burger required, writes Axios' Kelly Tyko. Why it matters: Drinks are becoming one of the most profitable parts of the business as rising food costs — including beef prices — squeeze margins on core items. The latest: McDonald's is launching six new specialty drinks on Wednesday, including refreshers and crafted sodas. Dunkin' rolled out new refreshers this week, a "dirty soda" and frozen coffee drinks. Wendy's added watermelon drinks, while chains like Taco Bell and KFC are expanding into energy and specialty beverages. Drink up.

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Taco Bell's comeback plan

Illustration: Brendan Lynch/Axios. Stock: Getty Images

The CEO of Yum Brands, Taco Bell's parent company, says the chain's "magic formula" of "brand buzz, innovation, value and digital" will help it recover from a sales dip tied to the national cyclospora outbreak, Axios' Nathan Bomey reports. Health officials have identified more than 11,000 confirmed or suspected cases of the parasite, which can cause explosive diarrhea. The outbreak has been linked to lettuce from supplier Taylor Farms. 📉 Yum says that the chain's sales are down 2% in the quarter compared with a year earlier. CEO Chris Turner said on an earnings call today: "The brand has seen a meaningful near-term sales impact." But he added: "We expect the sales impact to be temporary." 🥬 Taco Bell has removed lettuce from Taylor Farms. Execs didn't say whether they would keep doing business with the supplier. Turner said: "Our teams are acting quickly and transparently while keeping the safety and well-being of our consumers as the top priority. ... Consumers have become increasingly aware that this is an industry-wide issue, not an issue specific to Taco Bell." Taylor Farms said in a statement: "We are confident in our food and food safety systems and will continue to be transparent as more information becomes available." 👑 Taco Bell has been the crown jewel of Yum's lineup in recent years, delivering consistent sales growth. But as Bank of America analyst Sara Senatore wrote Monday: "The past two weeks have brought the brand's momentum — which seemed accelerated through the year — to a sudden halt." Go deeper.