Domino's U.S. Same-Store Sales Rebound After a Weak Quarter
U.S. same-store sales rose 0.3% in the third quarter, reversing a 0.1% gain in the second quarter, as international comps turned positive and operating income rose 8.3%.
Domino’s Pizza, Inc. (DPZ), the largest pizza company in the world, reported U.S. same-store sales growth of 0.3% in the third quarter of 2026, a pickup from 0.1% in the second quarter after a 0.9% increase in the first quarter. International same-store sales, excluding foreign currency, turned positive at 0.2% after two consecutive quarterly declines.
The rebound in U.S. comps and the flip in international comps marked a change in direction after a stretch in which both U.S. and international same-store sales had been slowing or negative. Global retail sales growth, excluding foreign currency, was 3.2%, down from 3.4% in the first quarter.
Income from operations rose 8.3% to $241.8 million from $223.2 million a year earlier. Excluding a $0.2 million negative foreign-currency impact on international franchise royalty revenues, operating income increased 8.4%. That year-over-year pace was faster than the 3.1% increase reported in the second quarter. The rise was primarily due to higher U.S. and international franchise royalties and fees and gross-margin dollar growth in the supply chain.
Total revenues were $1,185.6 million, up 3.4% from $1,147.1 million a year earlier. The increase was primarily due to higher supply chain revenues and higher global franchise royalty revenues, partially offset by lower U.S. Company-owned store revenues after refranchising of certain U.S. markets in the second quarter of 2026.
Supply chain revenues were $746.2 million, up from $697.0 million a year earlier. The increase was primarily attributable to higher order volumes and a 2.2% rise in food basket pricing to stores, matching the 2.2% increase reported in the second quarter. U.S. franchise royalties and fees were $165.6 million, and international franchise royalties and fees were $83.7 million. U.S. Company-owned store revenues were $61.4 million.
Supply chain gross margin expanded 0.9 percentage points to 12.2% from 11.3% a year earlier, primarily due to procurement productivity. That expansion was wider than the 0.2 percentage-point increase in the second quarter.
Net income was $152.2 million, up 9.2% from $139.3 million a year earlier. Diluted earnings were $4.60 a share, up 12.7% from $4.08. The per-share increase reflected higher net income and a lower weighted average diluted share count from share repurchases during the trailing four quarters.
Global net store growth was 175 stores, including 26 net U.S. openings and 149 net international openings. The system ended the quarter with 22,706 stores. Trailing-four-quarter net store growth was 956.
Joe Jordan, who stepped into the chief executive role, said the company’s opportunity is to capitalize on its brand, franchise system, global scale and operating capabilities by getting closer to customers, helping franchisees grow profitability and turning best performance into everyday performance.
The leverage ratio declined to 4.2x from 4.5x a year earlier. During the third quarter, the company repurchased and retired 216,282 shares for $73.6 million. Remaining authorized repurchase capacity was $1.15 billion as of September 6, 2026. On October 6, 2026, the board declared a $1.99 a share quarterly dividend, payable December 30, 2026, to holders of record December 15, 2026.