Even Domino’s couldn’t keep all its pandemic sales forever.
The Ann Arbor, Mich.-based pizza chain on Thursday said its same-store sales declined 1.9% in the U.S. in the third quarter, a function largely of difficult comparisons and a somewhat more normalized dining environment. On a two-year basis, the company said, its same-store sales were up 15.6%.
Yet it was the first time Domino’s has seen a quarterly decline in the key metric in more than 10 years, a remarkable run that has made the company a model for the intersection of restaurants and technology and ease of ordering.
It wasn’t just the length of the run of same-store sales performance but how much the chain’s sales grew at any one time. Domino’s averaged 7.6% quarterly same-store sales growth during that quarterly growth streak.
Yet its 17.5% same-store sales growth in the third quarter of 2020 was its strongest result during that period.
“We are pleased with our results this quarter, with robust store and sales increases internationally, while rolling over our highest quarter of 2020 in the U.S.,” CEO Ritch Allison said.
Domino's U.S. same-store sales
Source: Technomic, SEC
On an international basis, where same-store sales have increased every quarter since the early 1990s, same-store sales rose 8.8% in the quarter, which ended Sept. 12.
Net income increased 21.5% to $120.4 million, or $3.24 per share. Revenues rose 3.1% to $998 million.
Domino’s opened 45 new U.S. locations in the quarter and now operates 6,471 domestic units. Internationally, the company opened 278 locations. Worldwide, Domino’s and its franchisees operate 18,380 locations.
The increase in store count did offset the decline in same-store sales domestically. Retail sales, or total sales from the chain’s locations, rose 1.1% in the U.S. in the third quarter.
Nevertheless, the results from Domino’s are likely to generate concerns that the company is losing business it gained during the pandemic as the environment normalizes. The company’s stock rose 2% in premarket trading on Thursday.