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Dominos Pizza And Daddy Johns both fell in premarket trading after reporting mixed earnings on Thursday morning.
Domino’s analysts missed estimates for U.S. same-store sales and total revenue for the quarter. Domino’s also lowered its outlook. Papa John’s reported weaker than expected sales in North America.
Domino’s stock closed more than 11%, while Papa John’s fell 6%.
Both pizza companies recently raised prices to offset rising food, transportation and labor costs. Domino’s reported wavering demand amid a national driver shortage. Last October, Domino executives announced that factories would raise prices by about 7% in the fourth quarter, including raising its Mix & Match deal from $5.99 to $6.99.
Here’s how Domino’s fared, compared to analyst estimates, according to Refinitiv:
- Revenue: $1.39 billion vs. $1.44 billion expected
- Adjusted earnings per share: $3.97 vs. $3.94 expected
The Michigan-based company said U.S. same-store sales rose 0.9%, well below analysts’ estimates of 3.4%, according to estimates compiled by StreetAccount. This is a decline of 0.8% for fiscal year 2022.
Company-owned stores in the United States reported revenue of $117 million, below StreetAcount’s estimate of $129.3 million.
The company cut its two-to-three-year sales outlook to a 4% to 8% growth range of 6% to 10%, citing macroeconomic headwinds weighing on its domestic delivery business.
Revenue rose 3.6% in the fourth quarter of 2022 from the prior year period, citing higher supply chain revenue due to higher consumer basket prices for stores .
This month, Domino’s launched potato tots loaded with three flavors, which some analysts said could boost sales.
“We came under significant pressure on our U.S. delivery business in 2022 and have focused our efforts on creating solutions,” CEO Russell Weiner said. “We also continued the momentum of our US delivery business and achieved strong growth in international stores.”
Papa John’s pizza delivery bikes seen parked outside its branch in London.
Dinendra Haria | SOPA Pictures | Light flare | Getty Images
Papa John’s fourth-quarter results beat Wall Street expectations. Total revenue was down less than 1% from the company’s record fourth quarter last year. Revenue would have increased 3% without the strategic refranchising of dozens of restaurants.
Here’s how Papa John’s fared, compared to analyst estimates, according to Refinitiv:
- Revenue: $526.2 million vs. $523.8 million forecast
- Adjusted earnings per share: $0.71 vs. $0.66 expected
The Louisville-based company missed estimates on sales from the North American company-owned restaurants, reporting revenue of $172.2 million versus an expected $172.7 million, according to estimates compiled by StreetAccount. Comparable sales in North America increased by 1% compared to a year ago.
The company said it expects comparable sales in North America to grow between 2% and 4% each year, according to executives. For 2023, he expects growth to be at the lower end of that range, they added.
Domino’s and Papa John’s earnings come after stronger than expected earnings at McDonald’s And Yum! Brandsboth of which beat quarterly earnings and revenue estimates this quarter.
