For years, popular pizza chains like Domino’s, Pizza Hut (YUM) , Little Caesars (CZR) , and Papa John’s (PZZA) have battled to be crowned the best in the world.
These pizza chains have tried almost everything to gain more clients, including offering various deals, revamping their recipes, developing new menu items, and even creating marketing to target rival brands.
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Whether it be one’s taste buds, food preferences, budget, or plain nostalgia, everyone has a favorite pizza chain and plenty of reasons for choosing it.
However, the numbers don’t lie, and this pizza chain seems to have won the title by towering over all others.
Domino’s is the largest pizza chain in the U.S., with more than 6500 locations here, and a total of 21,002 stores across the globe as of June 2024. The brands sees worldwide retail sales of over $18.9 billion.
Although Domino’s ranks as the top pizza chain in the nation due to its reported positive yearly earnings growth, the company shouldn’t claim victory just yet.
As shown in its latest quarterly report, the company might be silently struggling: It fell short of analysts’ expectations in almost all areas of its business.
Domino’s pizza publishes its Q3 earnings report for 2024.
Domino’s/TheStreet
Domino’s reports positive Q3 earnings, but analysts are hungry for more
According to Domino’s (DPZ) Q3 earnings report for 2024, total sales grew by 5.1% compared to the previous year, but upon examining the reported numbers closely, the results were not as positive as they seemed.
The pizza chain’s international same-store sales showed positive growth, but only by 0.8%, a very small increase compared to analysts’ predictions of 2.84%.
Same-store sales in the U.S. increased by 3%, yet didn’t meet analysts’ expectations of 3.55% and reflected slower growth than the reported 4.8% in the previous Q3.
Retail sales in all Domino’s U.S. stores grew by 5.1% compared to the year prior, with company-owned store sales increasing by 3.1% and franchise locations growing by 3%.
However, neither of the U.S. store divisions met analysts’ predictions either.
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Domino’s reported total revenues of $1.08 billion, which were below analysts’ expectations of $1.1 billion.
The slower growth reflected in Domino’s earnings may attest to the company’s declining net income of 0.5%, which was attributed to higher income taxes.
Nonetheless, the company still managed to beat analysts’ EPS estimates of $3.65, reporting EPS of $4.19, which reflected a 0.2% yearly growth.
On Thursday’s market open, Domino’s fell 0.79%, yet is up over 17% from a year ago today.
Domino’s unveils a soft outlook for the upcoming years
Although Domino’s prioritized showcasing its positive numbers, the company warned the public of a challenging macroeconomic environment due to unprecedented business trends.
These concerning business trends led Domino’s to revise predictions and soften its outlook for the next few years.
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For its end-of-the-year outlook, Domino’s now expects global retail sales to grow around 6%, a 1% decrease from its previously predicted number, yet will maintain its annual operating income growth of 8%.
From 2026 to 2028, Domino’s expects positive annual global retail growth of more than 7% and an increase in annual operating income of over 8%.
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