Domino's Hungry for MORE Strategy Fuels Sales Surge and Margin Expansion

Domino's Pizza (NASDAQ: DPZ) reported strong third-quarter 2025 results, with revenue rising 6.2% year-over-year to $1.147 billion, driven by a 5.2% increase in U.S. same-store sales, according to Panabee's Domino's Pizza Earnings Q3 2025. The company exceeded Wall Street expectations, with GAAP earnings per share (EPS) of $4.08, surpassing the $3.96 analyst estimate, according to a Markets FinancialContent article. The performance was fueled by successful promotional campaigns, including the "Best Deal Ever" promotion and the launch of Parmesan Stuffed Crust pizza, which boosted order counts and customer engagement.

Domino's supply chain segment showed resilience, with gross margin expanding 0.7 percentage points to 11.3% despite a 3.3% rise in food basket pricing. This margin growth underscored the company's procurement productivity and vertical integration strategy, the Panabee article noted. However, U.S. company-owned store gross margin declined 0.5 percentage points to 16.3%, pressured by higher wages and internal food pricing, the Panabee article added.

International growth, while positive, moderated to 1.7% same-store sales growth (excluding foreign currency impact), as new store openings in international markets outpaced domestic expansion (185 vs. 29 net openings), the Panabee article reported. The company added 214 net stores globally, bringing its total to 21,750 locations, with 99% operated by franchisees.

Financially, Domino's generated $495.6 million in year-to-date free cash flow, a 31.8% increase, and completed a $1.0 billion refinancing to stabilize its debt profile, reducing the leverage ratio to 4.5x from 4.9x, according to the Panabee article. Despite a 5.2% drop in net income due to a $29.2 million unrealized loss on its DPC Dash investment, the company maintained a robust capital structure and authorized $540 million in remaining share repurchases.

CEO Russell Weiner highlighted the success of the "Hungry for MORE" strategy, noting that digital channels accounted for over 85% of U.S. sales in 2024 and that the company is well-positioned to meet its 3% U.S. same-store sales growth target for the year. Analysts expect continued growth in 2026, supported by expanding delivery partnerships and menu innovation.