Domino’s Pizza (NYSE:DPZ) saw its shares drop sharply on Tuesday, as the company announced a C-suite shake-up and quarterly results that missed expectations on most metrics.
The pizza chain posted fourth-quarter earnings and revenue that fell short of analysts’ expectations and also announced that CEO Ritch Allison plans to retire. Chief Operating Officer and U.S. President Russell Weiner will succeed him as head of the company, effective May 1.
The pizza chain reported fourth-quarter net income of $155.7 million, or $4.25 per share, up from $151.9 million, or $3.85 per share, a year earlier. Analysts surveyed by Refinitiv were expecting earnings per share of $4.28.
Net sales dropped 1% to $1.34 billion, missing expectations of $1.38 billion. The company said currency fluctuations, an extra week in 2020 and advertising incentives from promotions contributed to the fourth quarter’s decline in revenue.
U.S. same-store sales rose just 1% in the quarter, dragged down by weak performance by Domino’s company-owned restaurants. Analysts were expecting U.S. same-store sales growth of 2.9%, according to StreetAccount estimates.
After demand for Domino’s pizza and wings soared during the early days of the pandemic, the company has faced tough year-over-year comparisons. It has also had to reckon with a labor crunch that has resulted in shortened hours for some U.S. locations.
Outside the U.S., the chain’s performance also disappointed. International same-store sales rose 1.8% in the quarter, falling short of StreetAccount estimates of 6.6%.
The company added 468 net new locations during the quarter. More than 80% of those new restaurants are located outside the U.S.
DPM shares lost $21.49, or 5%, to $410.72 in Tuesday’s first hour.
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