DOMINO'S Pizza missed sales and profit estimates for the second consecutive quarter on Monday, underscoring pressure from weak demand, intensifying competition and macroeconomic uncertainty.
The pizza giant's quarterly sales have slid for the past few quarters as fears of higher living costs and a sluggish job market in the United States discourage consumers from splurging on discretionary purchases, including dining out.
Same-store sales in the US rose 0.1 percent for the quarter ended June 14, short of analysts' estimates for a 0.62-percent rise, according to data compiled by LSEG. Sales rose 3.4 percent a year ago.
Escalating Middle East tensions have increased uncertainty, driven up oil prices and raised concerns over higher fuel and transport costs that could fuel inflation.
Domino's retiring CEO Russell Weiner said the broader US quick-service restaurant industry remains under pressure, echoing his April warning that consumer sentiment had fallen to Covid-19-era lows in March as inflation weighed on spending decisions.
Like its rivals, Domino's has boosted promotions such as "Mix and Match" and "Emergency Pizza" and added items such as Parmesan-Stuffed Crust Pizza to its "Best Deal Ever" offer to attract value-conscious consumers as competition grows from local, handcrafted pizza makers.
Experts say local pizza shops are capturing market share from larger chains through strong branding, community ties and authentic offerings.
The rising popularity of GLP-1 weight-loss drugs and a shift toward healthier eating are adding pressure on national pizza chains.
Domino's quarterly profit of $4.07 per share also came in below estimates of $4.17 per share.
Its international same-store sales posted a surprise fall of 0.1 percent, compared with estimates of a rise of 0.5 percent. A year ago sales were up about 2.4 percent.
The company's second-quarter revenue of $1.19 billion edged past estimates of $1.18 billion. REUTERS
