Domino's Pizza (NYSE:DPZ) has reported second-quarter earnings that beat expectations but revenue that missed the mark, sending its shares lower in Monday pre-market trading.
The Ann Arbor, Michigan-based company grew global retail sales by 5.8% in the three months to June 30, 2023, excluding the negative impact of foreign currency.
It reported net store growth of 197 stores, including 170 outside of the US.
Revenue for the period fell 3.8% to $1.02 billion, below the $1.06 billion pencilled in by analysts.
It attributed the decline to lower supply chain revenues due to a decrease in its market basket pricing to stores, as well as lower order volumes. Additionally, revenue from US company-owned stores decreased as a result of the refranchising of stores in Arizona and Utah in the fourth quarter of 2022.
Diluted EPS increased by 9.2% year-over-year to $3.08, ahead of the $3.04 consensus estimate of analysts, according to Zacks Investment Research.
"We are executing our plan to restore delivery growth in the US," CEO Russell Weiner said in a statement.
"Our efforts to improve service and staffing while driving value and innovation will continue to make a difference in driving order counts in this important part of our business.”
The company said it will also benefit globally from a recently-accounted deal with Uber, which will result in over two-thirds of its outlets around the world being able to take orders from Uber Eats.
“We are excited to strategically enter the multi-billion dollar aggregator marketplace as the number one pizza brand in the world,” Weiner added.
Domino’s shares were down 3.2% at $373.27 ahead of the market opening.
Contact the author at stephen.gunnion@proactiveinvestors