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Short-term Borrowings and Long-term Debt
 9 Months Ended
Sep. 30, 2025
Debt Disclosure [Abstract]  
Short-term Borrowings and Long-term Debt Short-term Borrowings and Long-term Debt
Short-term Borrowings9/30/202512/31/2024
Current maturities of long-term debt$36 $29 
Other
15 — 
51 29 
Less current portion of debt issuance costs and discounts(3)(2)
Short-term borrowings$48 $27 
Long-term Debt  
Securitization Notes$4,306 $3,743 
Subsidiary Senior Unsecured Notes750 750 
Revolving Facility— 350 
Term Loan A Facility497 500 
Term Loan B Facility1,433 1,444 
YUM Senior Unsecured Notes4,550 4,550 
Finance lease obligations71 67 
$11,607 $11,404 
Less long-term portion of debt issuance costs and discounts(67)(69)
Less current maturities of long-term debt(36)(29)
Long-term debt$11,506 $11,306 

Taco Bell Funding, LLC (the “Issuer”), a special purpose limited liability company and a direct, wholly-owned subsidiary of Taco Bell Corp. (“TBC”), through a series of securitization transactions, has previously issued fixed rate senior secured notes collectively referred to as the “Securitization Notes” (details can be found within our 2024 Form 10-K). On September 24, 2025, the Issuer completed refinancing certain of such notes through the issuance of additional Securitization Notes totaling $1.5 billion (the “2025-1 Notes”). The net proceeds from the issuance of the 2025-1 Notes were used to repay in full an existing series of Securitization Notes totaling $938 million with an Anticipated Repayment Date (as defined in the Base Indenture) of May 2026. The remaining net proceeds were used to pay certain transaction-related expenses and for general corporate purposes (including, without limitation, purchases of franchised restaurants in the quarter ended December 31, 2025). The following table summarizes the series of Securitization Notes issued in the quarter ended September 30, 2025:

   Interest Rate
Issuance Date
Anticipated Repayment Date(a)
Outstanding Principal (in millions)Stated
Effective(b)
September 2025August 2030$1,000 4.821 %5.039 %
September 2025August 2032$500 5.049 %5.213 %

(a)    The legal final maturity date of the 2025-1 Notes is in August 2055. However, if the Issuer has not repaid or refinanced any series of these or previously existing Securitization Notes, prior to their respective Anticipated Repayment Dates, the rapid amortization of principal of all Securitization Notes may occur, in which event additional interest will accrue on all Securitization Notes, as provided in the Base Indenture for the Securitization Notes.

(b)    Includes the effects of the amortization of any debt issuance costs.

Payments of interest and principal on the 2025-1 Notes are made from the continuing fees paid pursuant to the franchise and license agreements with all U.S. Taco Bell restaurants, including both company and franchise operated restaurants. Interest on and principal payments of the 2025-1 Notes are due on a quarterly basis. In general, no amortization of principal of the 2025-1 Notes is required prior to their Anticipated Repayment Dates unless as of any quarterly measurement date the consolidated leverage ratio (the ratio of total debt to Net Cash Flow (as defined in the Base Indenture)) for the preceding four fiscal quarters of either the Company and its subsidiaries or the Issuer and its subsidiaries exceeds 5.5:1, in which case amortization payments of 1% per year of the outstanding principal as of the closing of the related 2025-1 Notes are required.
As a result of the issuance of the 2025 Notes, $14 million of fees were capitalized as debt issuance costs. The debt issuance costs are being amortized to Interest expense, net through the Anticipated Repayment Dates of the Securitization Notes utilizing the effective interest rate method.

Details of our Short-term borrowings and Long-term debt as of December 31, 2024 can be found within our 2024 Form 10-K.

Cash paid for interest during the years to date ended September 30, 2025 and 2024, was $364 million and $356 million, respectively.