Domino's Pizza reports weak sales, shares tank
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Domino’s Pizza (DPZ) posted weaker-than-expected sales during the second quarter. Shares of the pizza giant were tanking nearly 4% as of market open Tuesday.
Same-store sales, a key metric for restaurants, grew at a disappointing 3% in the U.S. Consensus estimates were for 4.6% domestic growth during the quarter. Meanwhile, same-store sales internationally grew 2.4%, which also missed analyst expectations for 2.6% growth.
“As a work-in-progress brand, we are constantly striving to improve in needed areas, execute our long-term strategy and build toward Dominant #1 – a goal I continue to feel we are built to achieve,” CEO Ritch Allison said in a statement.
The pizza giant reported adjusted earnings per share of $2.19, better-than-expectations for $2.02 adjusted earnings per share. However, Domino’s posted revenue of $811.6 million during the second quarter. Analysts were anticipating $836.59 million in revenue.
Domino’s has been struggling to meet consensus estimates for both domestic and international sales, as competition in the fast-food space continues to heat up. Delivery remains a key area of focus for restaurants, and the pizza companies such as Domino’s, Pizza Hut (YUM) and Papa John’s (PZZA) are taking a hit from third-party delivery companies looking to disrupt the industry.
So far this year, Domino’s stock has risen 9% and has been lagging both the broader market and its peers. The S&P 500 (^GSPC) advanced 21%, while Papa John’s jumped 16% and Yum Brands soared 22% in 2019.
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Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.
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