Domino's Pizza NASDAQ: DPZ executives told investors the company delivered positive order count and market share gains in the U.S. during the first quarter of 2026, but said results fell short of internal expectations as consumer uncertainty intensified late in the period and competition stepped up promotional activity.
CEO Russell Weiner said first-quarter U.S. same-store sales came in at 0.9%, which he attributed to a combination of macro pressure—particularly in March—weather impacts, and increased competitive discounting in the quick-service restaurant (QSR) pizza space. “While I was pleased with our start to the year, performance for the rest of the quarter did not meet our expectations,” Weiner said.
Macro pressure and stepped-up pizza discounting weighed on the quarter
Weiner said “consumer sentiment hit COVID level lows” and that inflation continued to influence purchase decisions. He also cited weather disruptions early in the quarter, including at the beginning of the company’s carryout special “boost week.”
On competition, Weiner said national pizza rivals ran deals “comparable, if not identical” to Domino’s value positioning. He described the dynamic as a short-term headwind for results but argued it could become a longer-term advantage for Domino’s franchise system. “Our advantage is profit power,” Weiner said, describing an ability to offer sustained value while supporting franchisee profitability through scale and advertising.
Weiner also pointed to store closures among competitors as a sign of stress, saying two public pizza competitors had already announced roughly 450 closures for 2026. In the Q&A, CFO Sandeep Reddy added that those competitors closed “about the same number of stores” in 2025 as well, framing the current environment as a continuation of prior share-gain dynamics for Domino’s.
U.S. results: modest comps, carryout outpaced delivery
Reddy said first-quarter operating income rose 4.2% excluding foreign currency effects and a gain on the sale of the company’s corporate aircraft, but noted the increase came in below the company’s expectations. He said the growth was driven primarily by higher U.S. and international franchise royalties and fees and by supply chain gross margin dollar growth.
Excluding foreign currency, global retail sales increased 3.4% in the quarter, supported by positive U.S. comps and net global store growth of more than 900 stores over the last 12 months. In the U.S., retail sales grew 2.8%, which Reddy said was driven by same-store sales and net store growth.
Reddy said the 0.9% U.S. same-store sales increase was driven by marketing promotions and continued growth in the company’s aggregator business, but tempered by macro and competitive pressures. He said the comp reflected “a balance of positive order counts and a positive average ticket.” Ticket benefited from 0.9% pricing, partially offset by negative mix.
- Carryout same-store sales rose 2.4%.
- Delivery same-store sales declined 0.3%.
On unit growth, Reddy said Domino’s added 19 net new U.S. stores during the quarter, bringing the domestic system store count to more than 7,200.
International: retail sales up, comps slightly negative
International retail sales increased 4% in the first quarter excluding foreign currency effects, driven by net store growth over the past year, including 161 stores added in the quarter. International same-store sales declined 0.4%.
Reddy said that “excluding the headwind on our comp sales from Domino’s Pizza Enterprises” (DPE), the international business would have met expectations. Weiner said Domino’s is “leaning in” with DPE and described DPE’s turnaround focus as “getting the value equation right to start order count driving again.” He noted that Andrew Gregory, the new CEO of DPE, is set to start in August.
Asked about war-related impacts, Weiner said franchisees in the Middle East had not seen an impact so far and noted the region represents “probably about 2%” of Domino’s operating income.
Technology and product plans: app launch, AI-enabled tracking, and an accelerated innovation calendar
Weiner highlighted progress under the company’s “Hungry for MORE” strategy, pointing to a full launch of Domino’s new app and updates to Pizza Tracker. He said the tracker has tracked more than 2.5 billion orders since 2008 and now provides more precise ready-time estimates using new AI technology, along with live activities for iOS users and more detailed order progress views.
He also described progress with a back-of-house “Domino’s orchestration agent” intended to support more efficient production and what he called “just-in-time pizza making.” As an example, he said the system can alert stores to hold an order if a driver will not be back in time to pick up a pizza when it exits the oven.
Looking ahead, Weiner said the company is adjusting its plans and calendar in response to macro conditions, including bringing forward or adding product and marketing activity. “Starting as soon as May, you’re gonna see things on the calendar or in media from Domino’s that weren’t on our calendar to start the year,” he said. He also said the company is planning “product innovation” in the second half of the year “particularly around pizza,” beyond what had originally been planned.
On menu breadth, Weiner noted that “40+%” of what Domino’s sells is not pizza and pointed to sandwiches and chicken offerings, as well as a global test of “CHICK DIP” in the U.K., which he said DPE has been “very excited” about so far.
Updated 2026 outlook and capital allocation
Reddy provided an updated 2026 outlook (excluding the impact of a 53rd week), citing increased macro pressure and geopolitical uncertainty. He said Domino’s now expects:
- U.S. same-store sales growth of positive low single digits.
- International same-store sales growth of low single digits.
- Net store growth of 175+ in the U.S. and approximately 800 internationally.
- Global retail sales growth of mid-single digits.
- Operating income growth of mid- to high-single digits, excluding foreign currency, refranchising gains, and the aircraft-sale gain.
Despite the updated outlook, Weiner reiterated that management’s internal objective remains 3% U.S. same-store sales growth for the year. “The guidance has been updated. The goals have not been updated at all,” he said.
On capital allocation, Reddy said Domino’s repurchased about 446,000 shares for $170 million year to date through April 21, with approximately $1.29 billion remaining on its repurchase authorization, including an additional $1 billion authorization approved by the board in April. He also said the company raised its dividend by 15% this year and reiterated that Domino’s has maintained a leverage ratio within its expected range of 4 to 6 times. Reddy said leverage has decreased since the company’s December 2023 investor day, falling to 4.3x as of the most recent quarter.
On gas prices, Weiner said the primary impact is on consumer disposable income and confidence, while adding that he was satisfied with current driver staffing levels and said the company was not seeing issues on driver availability.
Management repeatedly emphasized confidence in long-term share gains, with Weiner pointing to what he described as 11 points of U.S. market share gained over 11 years, alongside store growth and higher franchisee profits over that period.
About Domino's Pizza NASDAQ: DPZ
Domino's Pizza, Inc NASDAQ: DPZ is a global pizza delivery and carryout chain founded in 1960 and headquartered in Ann Arbor, Michigan. The company specializes in a broad range of hand‐crafted pizzas, including hand-tossed, thin crust and specialty offerings, alongside side items such as chicken wings, sandwiches, pasta, desserts and beverages. Domino's has built its brand on convenience and speed, leveraging proprietary ordering platforms and its Domino's Tracker system to provide real-time status updates from order placement through delivery.
Operating predominantly under a franchise model, Domino's has more than 17,000 stores worldwide, with approximately 95% of outlets owned and operated by independent franchisees.
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