Domino’s Pizza (NYSE:DPZ) on Thursday reported quarterly earnings missed estimates as pandemic costs weighed on profits and U.S. same-store sales growth slowed.
The pizza chain also released a new outlook for the next two to three years.
The pizza chain reported fiscal fourth-quarter net income of $151.9 million, or $3.85 per share, up from $129.3 million, or $3.12 per share, a year earlier. Performance-based expenses and costs related the coronavirus pandemic, including enhanced pay and bonuses for restaurant workers, weighed on profits.
Excluding the impact of a 53rd week, Domino’s earned $3.46 per share, missing the $3.89 per share expected by analysts.
Net sales rose 17.9% to $1.36 billion, falling short of expectations of $1.39 billion. U.S. same-store sales increased by 11.2%, down from third quarter’s 17.5% same-store sales growth. International same-store sales climbed 7.3%.
Domino’s also said that it made an additional $40 million investment in Dash Brands, the privately held company that serves as the pizza chain’s franchisee in China. Domino’s first invested in Dash in the second quarter of 2020, acquiring a noncontrolling stake for $40 million.
The company’s new two- to three-year outlook projects net unit growth of 6% to 8% and global retail sales growth of 6% to 10%, excluding foreign currency.
On Wednesday, its board reauthorized $1 billion in stock buybacks.
Shares of the company fell about 5% in pre-market trading. Thursday’s open saw the stock fall $32.66, or nearly 9%, to $331.94.
