Domino's Pizza misses Q2 estimates as same-store sales growth stalls

Domino's Pizza reported second-quarter revenue of $1.19 billion, edging past the $1.18 billion consensus, but earnings of $4.07 per share missed estimates of $4.17 as same-store sales growth virtually stalled.

"The broader US quick-service restaurant industry remains under pressure," retiring Chief Executive Officer Russell Weiner said, echoing his April warning that consumer sentiment had fallen to Covid-19-era lows.

US comparable sales inched up 0.1% for the quarter ended June 14, a dramatic deceleration from 3.4% a year ago and short of the 0.62% analysts had expected. International same-store sales posted a surprise decline of 0.1%, compared with estimates for a 0.5% increase. Revenue of $1.19 billion narrowly beat the $1.18 billion consensus.

The back-to-back quarterly miss shows the toll that persistent inflation, a sluggish job market and intensifying competition from local pizza makers are taking on the delivery giant. The rising popularity of GLP-1 weight-loss drugs and a shift toward healthier eating are adding further pressure on national pizza chains. Domino's has boosted promotions including "Mix and Match" and "Emergency Pizza" and added items such as Parmesan-Stuffed Crust Pizza to its "Best Deal Ever" offer to attract value-conscious consumers.

The results signal that the broader slowdown in the quick-service restaurant industry has reached even the delivery leader. Investors will watch for any guidance updates from incoming management and whether Domino's can regain momentum through its value-focused strategy in the quarters ahead.

This article is for informational purposes only and does not constitute investment advice.