Domino's Pizza, Inc. Q3 FY2025 earnings call

• Best Deal Ever promotion was a key driver of U.S. results, driving sales, market share, and franchisee profitability, extended longer than planned due to franchisee demand.
• Parmesan Stuffed Crust pizza launch was successful, meeting expectations in mix, new customers, and profitability.
• New BreadBytes flavors (garlic and cinnamon) launched, removing operationally complex bread twists and offering value at $6.99 for 32 bread bites.
• Fully rolled out on DoorDash in Q3, expecting sales growth on aggregators.
• Ecommerce platform upgrades: website and mobile web live, apps to roll out by end of 2025.
• First brand refresh in 13 years, reinvigorating the brand to align with Hungry for More strategy, with new look and feel rolling out in marketing.

In Q3, global retail sales grew 6.3% excluding foreign currency. U.S. retail sales grew 7%, driven by 5.2% same-store sales, with carryout comps up 8.7% and delivery positive 2.5%. U.S. added 29 net new stores, bringing system store count to 7,090. International retail sales grew 5.7% excluding foreign currency, driven by 185 net store growth and 1.7% same-store sales, with strength in Asia, particularly India.

• Reiterates U.S. same-store sales outlook of 3% in 2025, pressured by macro environment but confident in gaining market share.
• International same-store sales growth expected 1%-2%.
• U.S. net stores expected 175+; international net store growth in line with 2024.
• Operating income growth ~8% excluding foreign currency, severance, and refranchising gain impacts.

• Macro environment challenges impacting restaurant industry sales.
• Geopolitical uncertainty and DPE (Delivery Partner Environment) issues affecting international unit growth.

Q: Dennis Geiger asked about U.S. sales outlook, macro impact, and confidence in 3% same-store sales.

A: Sandeep Reddy discussed macro environment impact on restaurant industry sales, reiterating 3% same-store sales outlook and confidence in gaining market share against QSR pizza industry.

Q: David Palmer asked about delivery market, competition, and franchisee economics on DoorDash.

A: Russell Weiner and Sandeep Reddy discussed Domino's competitive edge in delivery, pricing for franchisee profitability, and long-term tailwind from aggregators.

Q: Brian Bittner asked about Best Deal Ever promotion's impact on consumer behavior and franchisee economics.

A: Russell Weiner discussed franchisee confidence in Best Deal Ever, its role in renowned value strategy, and that it's part of a mix of initiatives driving business.

Q: David Tarantino asked about confidence in 3% comps beyond 2025.

A: Russell Weiner explained that launched initiatives like loyalty, aggregators, stuffed crust are part of the base and will drive future growth.

Q: Gregory Francfort asked about Best Deal Ever price point and customer usage.

A: Russell Weiner discussed Best Deal Ever as complementary to mix and match, targeting different customer segments with value.

Q: Danilo Gargiulo asked about stuffed crust pizza sales mix and personal pizza renowned value.

A: Russell Weiner discussed satisfaction with stuffed crust launch and focus on data-driven decisions for renowned value initiatives.

Q: John Ivankoe asked about U.S. unit development and targets.

A: Sandeep Reddy and Russell Weiner discussed strong franchisee appetite, pipeline visibility, and long-term unit growth potential.

Q: Lauren Silberman asked about consumer environment weakness and 4Q expectations.

A: Sandeep Reddy discussed tough macro environment impact and that 4Q expectations are influenced by macro, but confidence in initiatives.

Q: Peter Saleh asked about carryout growth disaggregation and delivery-carryout crossover.

A: Sandeep Reddy and Russell Weiner discussed carryout growth drivers (Best Deal Ever, loyalty) and minimal delivery-carryout crossover.

Q: Andrew Charles asked about aggregator impact in 2026.

A: Russell Weiner and Sandeep Reddy discussed confidence in aggregator growth, incremental sales, and balanced delivery/carryout approach.

Q: Christine Cho asked about brand refresh considerations and timeline.

A: Russell Weiner discussed brand refresh inspired by Hungry for More, focusing on deliciousness and value, fully funded by franchisee advertising fees.

Q: Brian Harbour asked about recent macro pressures and business texture.

A: Sandeep Reddy discussed macro environment impact and that initiatives continue despite pressures.

Q: Alex Slagle asked about carryout/delivery balance and check growth.

A: Sandeep Reddy discussed balanced growth between ticket and order count, and strategic approach to not tip competitors.

Q: Isaiah Austin asked about DoorDash incrementality and customer distinction.

A: Russell Weiner discussed initial confidence in 50% incrementality and expected customer differences by market and income.

Q: Jeff Bernstein asked about international unit growth confidence.

A: Russell Weiner and Sandeep Reddy discussed working on DPE to drive sales and store growth, with strong performance in China and India.

Q: Todd Brooks asked about Best Deal Ever extension in Q4.

A: Russell Weiner discussed Best Deal Ever as part of an arsenal of value initiatives and confidence in Q4 performance.

Q: Zach Fadem asked about promotional success metrics and industry discounting.

A: Russell Weiner discussed Domino's unique value offers, focusing on profitable order counts and compounding frequency as key metrics.