Domino's Pizza Inc (DPZ) Q2 2025 Earnings Call Highlights: Strong Growth in US and ...
Global Retail Sales Growth: 5.6% in Q2, excluding foreign currency impact.
US Retail Sales Growth: 5.1% in Q2, driven by same-store sales and net store growth.
Same-Store Sales Growth: 3.4% in the US for Q2.
Carryout Comps: Increased 5.8% in Q2.
Delivery Growth: Positive 1.5% in Q2.
Net New Stores in the US: Added 30, bringing the total to 7,061.
International Retail Sales Growth: 6% in Q2, excluding foreign currency impact.
International Same-Store Sales Growth: 2.4% in Q2.
Net Store Growth Internationally: 148 new stores in Q2.
Share Repurchase: Approximately 316,000 shares repurchased at an average price of $475, totaling $150 million.
Refranchising Gain: $3.9 million pre-tax gain from refranchising 36 company-owned stores.
Warning! GuruFocus has detected 4 Warning Signs with AGYS.
Release Date: July 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Domino's Pizza Inc (NASDAQ:DPZ) reported strong results in the second quarter, with positive growth in both delivery and carryout businesses in the US.
The launch of the Parmesan Stuffed Crust Pizza has been successful, attracting new customers and meeting high expectations.
The company completed a national rollout with DoorDash, which is expected to be a significant driver of US sales in the latter half of the year.
Domino's rewards program continues to grow, contributing positively to the company's comps, particularly in the carryout business.
The refranchising of 36 company-owned stores in Maryland resulted in a pre-tax gain, strengthening the brand's position for long-term success.
Negative Points
The macroeconomic environment remains challenging, impacting financial results despite profit growth slightly ahead of expectations.
Foreign currency fluctuations are expected to be a headwind, potentially impacting operating income growth.
The international same-store sales growth is expected to be modest due to potential global macro and geopolitical uncertainties.
The company faces pressure from a flat QSR pizza category, which could challenge sustained growth in the future.
Corporate store margins were impacted by an insurance charge, highlighting potential vulnerabilities in the company's cost structure.
Q & A Highlights
Q: How does Domino's plan to sustain a 3% plus comp growth in the long term, given the current initiatives like Stuffed Crust and third-party marketing? A: Russell Weiner, CEO, emphasized that Domino's has consistently gained market share over the past decade, and the current initiatives like partnerships with aggregators and new product launches are not one-time events but part of a long-term strategy. The company has built a strong arsenal of tools, including a new loyalty program and e-commerce platform, to continue driving growth and capturing market share.
Q: Can you provide more details on the US sales outlook for the second half of the year and the impact of initiatives like DoorDash and loyalty programs? A: Russell Weiner, CEO, mentioned that initiatives such as the "Best Deal Ever" promotion and the full rollout of DoorDash are expected to drive sales in the second half. Sandeep Reddy, CFO, added that the carryout business is performing well, supported by the loyalty program, and both delivery and carryout are expected to be positive for the year.
Q: How does Domino's view the potential for DoorDash as a growth vehicle in the coming years? A: Russell Weiner, CEO, explained that Domino's aims to achieve its fair share on aggregator platforms like DoorDash and Uber Eats. The company sees significant potential for growth on these platforms, expecting to match its market share outside of aggregators over time.
Q: What is the status of international market share gains, particularly in top markets like India? A: Russell Weiner, CEO, highlighted India as a success story, with strong adoption of the Hungry for MORE strategy. Initiatives like new product launches and operational excellence are driving growth. Sandeep Reddy, CFO, added that other markets like Canada and Mexico are also performing well, with strong adoption of the strategy.
Q: How is Domino's addressing the current value-focused environment in the US pizza segment? A: Russell Weiner, CEO, stated that Domino's is well-positioned to thrive in a value-focused environment due to its strong franchisee economics, supply chain efficiencies, and large advertising budget. The company views consumer demand for value as an opportunity to gain market share, as it is better equipped than competitors to offer value while maintaining profitability.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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