Domino's Pizza Q2 Results: Parmesan Stuffed Crust Pizza Boosts US Comps

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4 days ago
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Domino's Pizza (DPZ, Financial) experienced a slight increase in stock price following its Q2 results. The company missed on EPS due to an unfavorable $27.4 million change related to its investment in DPC Dash. Revenue increased by 4.3% year-over-year to $1.15 billion, aligning with expectations. In the US, both delivery and carryout segments showed positive growth, with significant market share gains internationally.

  • In Q1, DPZ introduced the Parmesan Stuffed Crust Pizza, a major new menu item. The launch was successful, meeting high expectations and receiving high customer praise, filling a previous menu gap.
  • Domino's Rewards program boosted Q2 results, especially in carryout. The redesigned loyalty program aims to grow the carryout business. The Best Deal Ever promotion is currently running to offer value in a pressured market environment.
  • US comps grew by 3.4% in Q2, improving from a -0.5% decline in Q1. Carryout comps rose by 5.8%, while delivery increased by 1.5%, showing improvements in both DPZ's channel and aggregator delivery business.
  • The Parmesan Stuffed Crust Pizza launch boosted US comps with higher transaction counts and average ticket prices. International comps grew by 2.4%, with strong performance in Asia, particularly India, and in the Americas, led by Canada and Mexico.
  • DPZ completed its national rollout with DoorDash (DASH, Financial), the largest US aggregator, after applying learnings from its previous launch with Uber (UBER, Financial). Marketing on the platform is expected to drive US comps in the second half of 2025.

Overall, Domino's Pizza had a decent quarter, driven by the success of the Parmesan Stuffed Crust Pizza, especially in the carryout segment. Despite strong Q2 US comps, DPZ reaffirmed its FY25 US comp guidance at 3%, which might be seen as a disappointment. However, partnering with major delivery aggregators should provide a boost in the second half of 2025 as year-ago comps become easier, aiding its delivery segment.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.