Domino's Pizza Q4 Earnings Call Highlights

Key Points

• Domino’s rejected the “declining pizza” narrative, saying the U.S. QSR pizza category has grown ~1–2% annually and that management believes it can double its retail sales over time by gaining share.
• In 2025 the company posted positive comps and net store growth (172 net U.S. openings; nearly 600 in China/India), saw operating profits rise >8%, and said U.S. franchisee per-store profitability reached about $166,000, helped by product launches like Parmesan Stuffed Crust and the Best Deal Ever promotion.
• For 2026 Domino’s expects roughly 3% U.S. same-store sales, ~6% global retail sales growth and ~8% operating income growth (ex-53rd week), and it increased its quarterly dividend by 15% while repurchasing $80M of shares with about $460M remaining under authorization.

Domino's Pizza NASDAQ: DPZ executives used the company’s fourth-quarter and full-year 2025 earnings call to push back on the notion that U.S. pizza is a declining category, while outlining how product innovation, value promotions, and expanded distribution helped drive sales and profit growth in 2025 and underpin expectations for 2026.

Management disputes “declining pizza” narrative, points to long-term share opportunity

Chief Executive Officer Russell Weiner said the U.S. QSR pizza category has “generally grown approximately 1%-2% per year” since 2019 and argued that competitors’ struggles should not be confused with category weakness. Weiner said Domino’s has “dominated the QSR pizza category for over a decade” and believes growth prospects are strong as the company continues executing its “Hungry for MORE” strategy.

Weiner also described what he called a long-term “ultimate opportunity” in the U.S., noting that some QSR category leaders hold 40% to 50% share. In that context, he said he believes Domino’s can “double our retail sales from where they are today” over time, citing higher share levels achieved in certain international and U.S. markets. On the Q&A, CFO Sandeep Reddy added that the company’s guidance framework already contemplates continued share gains through 2028, but management did not provide a cadence beyond that period.

2025 highlights: comps, store growth, market share gains, and franchisee profits

Weiner said the company grew both carryout and delivery again in the U.S. during 2025 and delivered positive order counts in both U.S. and international businesses. He pointed to global net store growth in line with expectations, including 172 net new stores in the U.S. He also highlighted strong development in China and India, which he said opened nearly 600 net stores combined last year.

On market share, Weiner said U.S. same-store sales growth of 3% and net openings contributed to another point of share gain in 2025, bringing total gains to roughly 11 points over the last 11 years. He also said company operating profits grew more than 8% in 2025 and estimated U.S. franchisee per-store profitability increased to about $166,000.

Reddy provided additional financial detail, saying fourth-quarter income from operations increased 7.3% excluding foreign currency impacts, driven primarily by higher U.S. franchise royalties and fees and supply chain gross margin dollar growth. He said this was partially offset by a decline in U.S. company-owned store margins, “meaningfully impacted by outsized insurance costs.” For fiscal 2025, Reddy said income from operations rose 8.1% excluding a $0.6 million negative foreign currency impact and $4 million in refranchising gains.

Reddy said global retail sales grew 4.9% in the fourth quarter and 5.4% for the year (excluding foreign currency), reflecting positive comps and net store growth. U.S. retail sales increased 5.5% in Q4, with same-store sales up 3.7% on the strength of the “Best Deal Ever” promotion, a new specialty pizza, and contributions from aggregators. Pricing was flat in the quarter, he said.

Channel results showed carryout comps up 6.5% and delivery up 1.6% in Q4. For the full year, U.S. same-store sales grew 3%, which Reddy said was driven primarily by value promotions including Best Deal Ever and the launch of Parmesan Stuffed Crust. For 2025, delivery represented 45% of transactions and 56% of sales, while carryout represented 55% of transactions and 44% of sales, with mix shifting slightly further toward carryout.

Strategy drivers: product, value, loyalty, and aggregators

Weiner singled out two initiatives as notable contributors in 2025: Parmesan Stuffed Crust and Best Deal Ever. He said the stuffed crust launch met expectations on mix, incremental new customers, and franchisee profitability, while Best Deal Ever resonated with value-seeking consumers and also supported franchisee profits. “We have profit power,” Weiner said, arguing Domino’s can offer value while still improving profitability.

Management repeatedly emphasized that major initiatives are designed to extend beyond the initial launch year. Weiner cited carryout as an example, saying Domino’s began investing in U.S. carryout in 2010 and it has grown an average of 10% annually since then, ending 2025 at approximately $4.4 billion. He also highlighted the loyalty program, noting Domino’s Rewards ended 2025 with 37.3 million active users, up nearly 20% since the 2023 relaunch.

Looking ahead, Weiner said the company expects continued growth on aggregator platforms, particularly DoorDash, which was not fully rolled out until mid-2025. He said Domino’s has not yet reached its “fair share” on either major aggregator and expects share to improve as awareness and marketing spend increase, while management said it is managing aggregators “with discipline” to ensure incremental sales and profits.

2026 outlook: 3% U.S. comp, ~6% global retail sales growth, and ~8% operating income growth (ex 53rd week)

Reddy outlined 2026 guidance excluding the impact of a 53rd week, which the company estimates would add about 2% to global retail sales and operating profit growth. Excluding that, Domino’s expects global retail sales growth of approximately 6%, U.S. same-store sales growth of 3%, and operating income growth of about 8% excluding foreign currency and refranchising gains. Reddy said the company expects U.S. comps to be stronger in the first half than the second half due to timing of initiatives and expects the macro environment to remain pressured.

For international markets, Reddy guided to same-store sales growth of 1% to 2% in 2026, citing continued pressures at Domino’s Pizza Enterprises (DPE) and a comp drag from high-volume new store openings in China. He said that excluding the DPE headwind in 2025, international comps would have aligned with the company’s long-term 3% algorithm.

On development, Domino’s expects more than 175 net U.S. store openings and approximately 800 net international openings in 2026. Management said the international increase is tied to expectations for fewer closures at DPE and continued growth in China and India. Weiner said leadership views improving DPE’s performance as a top priority and noted the hiring of DPE’s new CEO, Andrew Gregory. Executives also said they are working closely with DPE, including in-person engagement planned in Australia.

Reddy added several 2026 P&L assumptions discussed on the call:

• Food basket inflation expected to be “moderate,” up low single digits.
• Supply chain margins expected to grow year over year due to procurement productivity, though with less productivity than the last couple of years.
• G&A expected to be approximately 2.3% of global retail sales.
• Technology fee increased by $0.01 to $0.385 per digital transaction beginning February 2026 to fund technology initiatives.
• Operating income margin expected to expand slightly, driven by sales leverage and supply chain margin expansion.
• Tax rate expected to be 21% to 23%; CapEx expected to be about $120 million in 2026 before returning to $110 million in 2027.

Management also said low single-digit pricing is embedded in the 2026 U.S. comp outlook. In Q&A, executives said they had not seen an impact from GLP-1 usage on the business so far, while indicating they are monitoring potential implications.

Capital return: dividend increase and buybacks

Domino’s announced a 15% increase in its quarterly dividend. The company also repurchased about 189,000 shares for $80 million in the fourth quarter, ending 2025 with roughly $460 million remaining under its share repurchase authorization.

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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