Domino’s Pizza posted its first drop in U.S. same-store sales in over a decade on Thursday, because the world’s largest pizza chain grappled with a slowdown in supply demand and a tight labor market that created a scarcity of drivers.
As COVID-19 curbs ease, Americans have began to eat out at eating places after more than a year of ordering meals at residence, slowing sales at Domino’s that will get most of its business from deliveries and take-away orders.
Adding to its woes, Domino’s additionally stated a extreme labor crunch in the United States dealt a blow to its business, forcing it to scale back retailer working hours and compromise on supply service instances.
To deal with the labor scarcity, Domino’s Chief Executive Officer Richard Allison stated the company would maximize the variety of deliveries a driver might make per shift.
“I don’t see why drivers should ever have to get out of their cars. Why can’t we keep them turning to the store back to the customer and maximizing deliveries per driver per hour,” Allison stated on a name with analysts.
The Michigan-based company stated stimulus test advantages rolling off additionally helped result in a 1.9% fall in same-store sales at its U.S. eating places throughout the third quarter.
That was off analysts’ estimate of a 1.89% improve, in response to IBES knowledge from Refinitiv, and a reported soar of 17.5% a year in the past.
Compared with 2019, nevertheless, the pizza chain’s U.S. same-store sales have been nonetheless up 15.6%.
Shares of the company rose 2% in afternoon buying and selling, because it additionally reported a rise of 8.8% in its worldwide same-store sales.
Domino’s internet revenue rose 21.5% to $120.4 million or $3.24 per share, beating estimates of $3.11 per share and assuaging some issues that rising wage bills have been pressuring the company’s revenue margins.