Domino’s Pizza (DPZ) has reported mixed financial results for this year’s second quarter and tepid same-store sales growth.
The U.S. restaurant chain announced earnings per share (EPS) of $4.07 U.S., which was below the $4.17 U.S. consensus expectation of analysts.
However, revenue of $1.19 billion U.S. beat Wall Street’s forecast of $1.18 billion U.S. Domino’s sales were up 4.3% from the same period a year ago.
Systemwide sales increased 1.9% in the U.S. and 4.1% in international markets. But much of that growth was driven by new store openings.
Domino’s overall same-store sales growth came in at a tepid 0.1% in the U.S., while international same-store sales declined 0.1% year-over-year.
Management said revenue increased largely because it charged franchisees higher prices for ingredients such as pepperoni and vegetables, which helped boost earnings.
Looking ahead, executives at Domino’s Pizza now expect low-single-digit comparable sales growth in both the U.S. and international markets.
Management said they continue to struggle with financial pressures impacting lower-income consumers and rising competition across the pizza category.
Analysts have expressed concerns that ongoing discounts are supporting customer traffic at the expense of profitability.
Domino’s recently announced that Joe Jordan, currently the company’s U.S. President, will succeed Russell Weiner as chief executive officer (CEO) on Oct. 1 of this year.
DPZ stock has declined 30% over the last 12 months to trade at $322.18 U.S. per share.
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