Domino's expects weak same-store sales growth for the full year due to intense competition and cautious consumer attitudes putting pressure on demand.

Reuters, October 13 - Domino's Pizza (DPZ.O) on Tuesday lowered its full-year sales forecast and warned that same-store sales growth in the US and international markets would remain sluggish. As a result, the company's shares fell about 3% in early trading.

The pizza giant has reported slowing same-store sales growth for several consecutive quarters, mainly due to intensified competition, persistent inflation, and a softening US labor market (link). These factors have made consumers increasingly cautious about discretionary spending.

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Details are as follows:

• "We expect that the macro environment will continue to put pressure on consumers for the rest of this year," said newly appointed CEO Joe Jordan during the earnings call earlier this month.

• Jordan added that overall demand in the fast food and pizza industry remains challenged.

• Jordan stated that the company aims to restore profit and order growth, while expanding competition beyond the traditional fast food pizza market.

• Domino's now expects US same-store sales to be at the low end of its low single-digit growth forecast.

• eToro analyst Lailey Akoner said the key test for the new CEO is how to drive order growth through promotions and new products without undermining franchisee profitability.

• Its annual international comparable sales are expected to be roughly flat, compared with previous guidance of low single-digit growth.

• According to data compiled by London Stock Exchange Group (LSEG), Domino's US quarterly same-store sales increased 0.3%, below analysts' expectation of a 0.71% rise.

• Its quarterly international same-store sales grew 0.2%, while the market had expected a 0.88% gain.

• However, Domino's reported quarterly revenue of $1.19 billion and earnings per share of $4.60, both beating market expectations of $1.18 billion and $4.37 per share.

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