- U.S. same-store sales grew just 0.9%, well below the 2.72% analysts expected.
- International sales declined 0.4%, missing estimates for 0.7% growth.
- The company announced a new $1 billion share buyback program.
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Domino's Pizza Stock Falls 7% After Missing Q1 Sales Estimates
(Domino’s Pizza Inc.) shares fell nearly 7% in pre-market trading after the company reported first-quarter sales that missed Wall Street estimates, a sign that budget-conscious consumers are pulling back on discretionary spending.
"Consumers, already burdened by high inflation and a weak labor market, are bracing for another hit from rising transportation costs that threaten to further drive up food prices," according to a Reuters report, accelerating a shift toward lower-cost, at-home meals.
The pizza giant reported that U.S. same-store sales grew 0.9% in the first quarter, significantly underperforming the 2.72% growth analysts had projected, according to LSEG data. International sales were even weaker, with same-store sales declining by 0.4%, compared to analyst estimates of a 0.7% rise. The company's earnings per share of $4.13 also fell short of the $4.27 consensus estimate.
The miss comes as restaurants and fast-food chains broadly face pressure from consumers cutting back. To combat this, Domino's has been promoting value deals, including its $9.99 "Best Deal Ever" and other offers. Alongside the earnings, the company announced a new $1 billion share repurchase program.
The disappointing results put the stock on pace for its biggest drop in over a year, testing investor confidence. Investors will be closely watching whether the company's value promotions can successfully bring back customers in the second quarter.
This article is for informational purposes only and does not constitute investment advice.
