Domino’s Pizza’s quarterly revenue edged past Wall Street estimates today as growth in its supply-chain business offset softer demand at its restaurants, where cautious consumers curbed discretionary spending.
Shares of the company have fallen about 23% this year.
The pizza chain operates a supply-chain business that manufactures and distributes ingredients, pizza dough and equipment to franchised and company-owned stores. Revenue rises when stores order more supplies or food prices increase.
The Michigan-based company’s second-quarter revenue rose 4.3% to $1.19 billion, edging past estimates of $1.18 billion, helped by a 6.5% rise in quarterly supply-chain revenue to $731.7m.
Domino’s said supply-chain revenue rose on higher order volumes from stores and a 2.2% increase in food-basket pricing, reflecting modest inflation in the ingredients and supplies it sells to franchisees.
“I believe order growth is the most important driver of long-term success in our business,” Domino’s retiring CEO Russell Weiner said in a statement, adding that order volumes rose despite weak industry demand.
Same-store sales in the US, however, rose only 0.1% for the quarter ended June 14, short of analysts’ estimates for a 0.62% rise, according to data compiled by LSEG. Sales rose 3.4% from a year ago.
