Domino’s Pizza(US:DPZ)2026-02-23 14:30Financial Data and Key Metrics Changes - Income from operations increased by 8.1% for fiscal 2025, excluding a negative impact of $0.6 million from foreign currency and $4 million in refranchising gains [17] - Global retail sales grew by 5.4% for the year, driven by positive U.S. and international comps and global net store growth [18] - Estimated average U.S. franchisee store profitability increased to approximately $166,000, up $4,000 from the prior year [20] Business Line Data and Key Metrics Changes - U.S. same-store sales grew by 3% for the year, primarily driven by promotions and the successful launch of Parmesan Stuffed Crust pizza [19] - Carryout comps were up 6.5%, while delivery was positive at 1.6% [19] - Global net store growth included 172 net new stores in the U.S. and 604 internationally, with significant contributions from China and India [20][21] Market Data and Key Metrics Changes - The U.S. pizza category has generally grown at approximately 1%-2% per year, with Domino's gaining approximately 11 points of market share over the last 11 years [4][8] - International same-store sales grew by 1.9% for the year, with retail sales increasing by 5.9% [21] Company Strategy and Development Direction - The company aims to double its U.S. retail sales from current levels, leveraging its strong brand and market position [6][52] - The "Hungry for MORE" strategy is focused on product innovation and operational excellence, with plans for two or more product innovations in 2026 [11][30] - The company expects to continue growing its carryout business and enhancing its loyalty program, which has seen a 20% increase in active users [12][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth prospects despite a challenging macro environment, expecting U.S. same-store sales to grow by 3% in 2026 [11][24] - The company anticipates continued growth in the pizza category, driven by its strong market share and operational efficiencies [5][32] Other Important Information - The company announced a 15% increase in its quarterly dividend and repurchased approximately 189,000 shares for a total of $80 million in Q4 [21] - The company expects capital expenditures to be approximately $120 million in 2026 [26] Q&A Session Summary Question: Concerns about maintaining performance in 2026 - Management emphasized that past initiatives have long-term impacts and that they expect continued growth from existing strategies and new product launches [29][30] Question: Contribution of existing initiatives versus new ones - Management indicated that existing initiatives will continue to drive sales, with new initiatives expected to compound growth over time [36][41] Question: Outlook for delivery business sustainability - Management noted that they are not at their fair share in delivery and expect growth in both delivery and carryout segments [44][49] Question: Changes in income cohorts and delivery/carryout dynamics - Management reported growth across all income cohorts and consistent performance in delivery and carryout, indicating no significant changes in customer behavior [60][61] Question: Updates on technology initiatives - Management highlighted improvements in their e-commerce platform and ongoing enhancements to their operational technology [64][66] Question: Impact of insurance costs on margins - Management acknowledged the impact of rising insurance costs but noted that franchisee profitability remains strong [70][71]