Domino’s Pizza shares were down about 2% in morning trading after the pizza chain’s quarterly U.S. same-store sales turned negative for the first time since 2011.
The pandemic brought skyrocketing demand for Domino’s pizza in its home market, but as consumers were vaccinated and states relaxed restrictions, investors began to worry about pizza fatigue. Last quarter, despite facing tough comparisons, U.S. same-store sales still rose 3.5%.
The company’s third quarter seems to be the turning point. U.S. same-store sales shrank by 1.9%, although the metric was up by 15.6% on a two-year basis. StreetAccount estimates forecast that the company would report U.S. same-store sales growth of 1.8%.
The decline in U.S. demand led the pizza chain to fall short of Wall Street’s revenue estimates. Analysts surveyed by Refinitiv were expecting net sales of $1.04 billion, but Domino’s reported $998 million in revenue for the quarter.
Outside the U.S., the company’s business is faring much better. International same-store sales climbed 8.8% in the quarter, up 15% on a two-year basis.
Domino’s earned $3.24 per share during the quarter, topping the $3.11 per share expected by analysts surveyed by Refinitiv.
Although Domino’s shares were down more than 5% at one point in premarket trading on Thursday, the stock has climbed 20% this year, bringing its market value to $17 billion.
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