Can Wendy's Digital Push and Gamified App Lift Engagement and Sales?

The Wendy’s Company (WEN) is leaning on digital investments to improve engagement and drive sales as consumer traffic remains under pressure. In the first quarter of 2025, the company continued to enhance its digital channels, with app engagement reaching an all-time high. The digital mix rose to more than 20% of total sales, supported by new features that encourage customer interaction beyond the point of purchase.

A key development is the gamification of the Wendy’s app. This feature was introduced to deepen user engagement and build repeat visits. The app now offers more personalized content and targeted digital messaging, which the company believes is helping improve conversion rates.

Another major focus is the rollout of Fresh AI and digital menu boards. As of the first quarter, Wendy’s deployed Fresh AI in 168 locations and remains on track to reach more than 500 by year-end. The technology suggests curated add-ons at the point of ordering, which is already leading to higher average checks. It also aims to improve order accuracy and crew productivity, two areas linked directly to customer satisfaction.

Wendy’s plans to scale its digital initiatives throughout 2025. The combination of gamified engagement, personalized app features and in-store technology is expected to support stronger customer loyalty and lift average spend. As adoption increases, the digital platform is set to play a larger role in driving long-term growth.

How Peers Are Advancing Digital Capabilities to Drive Growth

Digital transformation continues to shape strategies across the restaurant space, with Yum! Brands, Inc. (YUM) and BJ’s Restaurants, Inc. (BJRI) focusing on operational upgrades and guest engagement.

Yum! Brands is benefiting from strong performance at its KFC and Taco Bell divisions, along with continued growth in digital sales. The company is expanding its Byte platform with AI-powered personalization and loyalty integration. A new partnership with NVIDIA is expected to accelerate Yum! Brands’ AI adoption across drive-thrus, kitchens and restaurant management, supporting faster service and improved team productivity.

BJ’s Restaurants is advancing digital upgrades across systems to streamline service and control costs. Enhancements to POS and kitchen display tools have improved order speed and accuracy, while also lowering food and beverage comp costs. In select markets, BJ’s Restaurants is using AI-driven labor scheduling and forecasting to boost efficiency and guest sentiment. Off-premise digital experience remains a focus, with broader improvements planned later in the year.

WEN Price Performance, Valuation and Estimates

Wendy’s shares have lost 12.2% in the past three months against the industry’s growth of 4.6%.

Price Performance

WEN is currently priced at a discount relative to its industry. It has a forward 12-month price-to-earnings ratio of 11.31, which is well below the industry average.

P/E (F12M)

The Zacks Consensus Estimate for 2025 earnings per share has remained stable in the past 30 days.

The company currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research