Q1 2025 Domino's Pizza Inc Earnings Call
Okay.
Speaker Change: Thank you for standing by and welcome to Domino's Pizza first quarter 2025 earnings Conference call. At this time all participants are in listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During this session you'll need to press star one on your telephone.
Greg: Your question has been answered and he'd like to remove yourself from the queue simply press Star One again as a reminder, today's program is being recorded and now I'd like to introduce your host for today's program, Greg Let me check Vice President Investor Relations. Please go ahead, Sir good morning, everyone. Thank you for joining us today for our first quarter call.
Speaker Change: <unk> call today's call will begin with our Chief Executive Officer, Russell Leaner, followed by our Chief Financial Officer Sandeep Reddy the.
Greg: The call will conclude with a Q&A session.
The forward looking statements in this morning's earnings release and 10-Q, both of which are available on our IR website also apply to our comments on the call today.
Greg: Actual results or trends could differ materially from our forecast for more information. Please refer to the risk factors discussed in our filings with the SEC.
Greg: In addition, please refer to the 8-K earnings release to find disclosures and reconciliations of non-GAAP financial measures that may be referenced on today's call.
Greg: This mornings conference call is being webcast and is also being recorded for replay via our website.
Greg: We want to do our best this morning to accommodate as many of your questions as time permits.
Greg: Such we encourage you to ask one question only so with that I'd like to turn the call over to Russell.
Russell Leaner: Thanks, Greg and good morning, everybody as I reflect on the first quarter I'm proud of how our team effectively executed are hungry for more strategy against the backdrop of consumer and industry headwinds, we drove market share gains across both our U S and international businesses sustained.
Russell Leaner: Sustained market share growth reflects the companys ability to control whats under its control.
Russell Leaner: A key to long term success.
Russell Leaner: Our team is achieving what we set out to do when we introduced hungry for more late in 2023.
Russell Leaner: When you look at our accomplishments over the last year and a half with insight into some of the unlocks for the remainder of 2025, you can see how our hungry for more strategic pillars are working together to set us up to drive more sales more stores and more profits over the long term.
Russell Leaner: The MN hungry for more stands for most delicious food.
Russell Leaner: We'll continue to drive Deliciousness with at least two new products every year.
Russell Leaner: In early March we added arguably the biggest new menu item in our history.
Russell Leaner: Parmesan stuffed crust pizza.
Russell Leaner: This launch is the epitome of what we mean, when we talk about our innovation with intent approach.
There is a clear purpose behind any product, we bring to market and stuffed crust pizza is one of our best examples.
Russell Leaner: We went from this being the largest gap in our pizza portfolio to having what we believe is the best stuff crust product in the industry.
Russell Leaner: While timing of the launch men stuffed crust didn't have a meaningful impact on Q1, we couldnt be happier with how the launch has gone so far.
Russell Leaner: To date customer satisfaction scores have been very good.
Russell Leaner: And we've also seen a high mix of orders coming with the stock crust pizza.
Russell Leaner: Although it's still early performance has been tracking to our expectations.
Russell Leaner: We're excited about the impact this project will have not only this year, but as a market share driver for years to come.
Russell Leaner: Prior to this year, the operational complexity of stuffed crust and our high volumes kept stuffed crust off our menu in the U S.
Russell Leaner: Launching an innovation like this required us to lean into our second strategic pillar operational excellence.
Russell Leaner: Innovation with intent requires operations with intent.
Russell Leaner: On our Q4 call I talked about the improvements in our service driven by significant training programs implemented by our operators and franchisees over the last couple of years.
Russell Leaner: These programs work together with improvements in our <unk> technology to make parmesan stuffed crust reality.
Russell Leaner: Domino's stores are doing an incredible job executing this product.
Russell Leaner: I want to thank our franchisees and operations teams for their continued effort to achieve operational excellence. This remains a point of difference predominance.
Russell Leaner: Our third hungry for more a pillar is renowned value. This has been a key strength for domino's.
Russell Leaner: Driving around value through national promotions, Domino's rewards and by growing an aggregator platforms.
Russell Leaner: In the first quarter, we had several value driving initiatives such as our best deal ever promotion that we believe broke through industry clutter.
Russell Leaner: We have a strong slate of initiatives primed and ready to go for the rest of the year as we will continue to give customers what they want which is more value in this challenging economic environment.
Russell Leaner: While providing value through our own channel is one part of our written down value barbell strategy tapping into the aggregator marketplace for pizza delivery is the other.
Russell Leaner: We recently announced a partnership with door dash the largest aggregator in the U S.
Russell Leaner: We began piloting in a small number of stores and are expecting to commence our national launch in may.
Russell Leaner: We expect this rollout to be complete by the end of the second quarter with a meaningful impact from this new partnership anticipated in the back half of the year.
Russell Leaner: So in the second half of 2025 and beyond we'll be competing on the biggest aggregator platform in the U S. With one of the biggest pizza crust types in our industry too.
Russell Leaner: Two things, we could not have said only a few months ago.
Russell Leaner: I wanted to quickly touch on our expectations around instrumentality for door dash.
Russell Leaner: We're going to need to learn and provide updates on this but our initial expectations are that it will be approximately 50% incremental.
Russell Leaner: And that would be our expectations for Aggregators as we move forward now that we're on multiple platforms.
Russell Leaner: Everything we do at Domino's is enhanced by our best in class franchisees.
Russell Leaner: We also see this pillar is our responsibility to be a best in class franchise Org.
Russell Leaner: In the first quarter, we made some changes to our organizational structure, which you may have seen with the announcement, we put out in March where we elevated Joe Jordan to Chief operating officer, and promoted waking Ang two head of Domino's International.
Russell Leaner: We also made changes below the executive level for a faster more efficient structure that aligns with our hungry for more strategy.
Russell Leaner: Our focus simplify including the difficult decision to eliminate certain roles and Sandeep will share some additional color on the financial implications.
Russell Leaner: Moving forward, we believe this new structure will allow us to be quicker to market.
Russell Leaner: And we will continue to prioritize investments that have the greatest impact on our customers franchisees and the brand.
Russell Leaner: In summary, we are laser focused on delivering against our Hungary from our goals I believe this will enable dominoes to capture additional market share gains in 2025 and beyond and this will be how we drive best in class results and long term value creation for our franchisees and shareholders.
Sandeep Reddy: I'll now hand, the call over to Sandeep.
Sandeep Reddy: Thank you and good morning, everyone.
Sandeep Reddy: Our first quarter financial results continued to be impacted by a challenging macro backdrop and despite that we delivered operating profit that was in line with our expectations.
Sandeep Reddy: Income from operations increased one 4% in Q1, excluding the impact of foreign currency.
Sandeep Reddy: This increase was primarily due to gross margin dollar growth within supply chain.
Sandeep Reddy: As well as higher international franchise royalties and fees.
Sandeep Reddy: This increase was partially offset by higher G&A.
Sandeep Reddy: Primarily related to severance expenses driven by the organizational realignment Russell noted earlier.
Sandeep Reddy: Excluding the approximately $5 million impact of these expenses.
Sandeep Reddy: Come from operations would have increased three 6%.
Sandeep Reddy: Excluding the impact of foreign currency.
Sandeep Reddy: <unk> retail sales grew four 7% in the first quarter.
Sandeep Reddy: Primarily due to positive international comps and global net store growth compared to a year ago.
Sandeep Reddy: In Q1 retail sales grew by one 3% in the U S.
Sandeep Reddy: Primarily driven by net store growth.
Sandeep Reddy: This growth paced ahead of the <unk> pizza category.
Sandeep Reddy: Which was roughly flat to stop here.
Sandeep Reddy: Same store sales declined <unk>, 5%, which was slightly below our expectations.
Sandeep Reddy: We benefited from one 8% of pricing.
Sandeep Reddy: Which was inclusive of high single digits in California.
Sandeep Reddy: This was more than offset by negative traffic and a slight decline in our mix due to a higher carryover business that care.
Sandeep Reddy: He has a lower ticket and delivery.
Sandeep Reddy: Our carryover business comps were up 1%.
Sandeep Reddy: Delivery was down one 5% in the quarter.
Sandeep Reddy: Our delivery business continues to be impacted by macro pressures.
Sandeep Reddy: <unk> been low income consumer.
Sandeep Reddy: Shifting to U S unit count.
Sandeep Reddy: We added 17, net new stores, bringing our U S systems store count to 7031.
Sandeep Reddy: International retail sales grew eight 2%, excluding the impact of foreign currency in the quarter.
Sandeep Reddy: This was driven by net store growth over the last year and same store sales that came in ahead of our expectations at three 7%.
Sandeep Reddy: In the quarter, we saw strength in Asia that was due to strong comps in India and in our Americas region, which was driven by Canada.
Sandeep Reddy: Net stores were done by 'twenty five in Q1, and this was primarily coming from closures from Domino's Pizza Enterprises, DPA, which is our master franchisee based on Australia.
Sandeep Reddy: <unk> previously announced we expect it to close 200, plus underperforming stores primarily in Japan.
Sandeep Reddy: And substantially all of those closures took place in the quarter.
Sandeep Reddy: Moving to capital allocation.
Sandeep Reddy: We repurchased approximately 115000 shares at an average price of $434 for a total of $50 million in the first quarter.
Sandeep Reddy: As of the end of Q1, we had approximately $764 million remaining on our share repurchase authorization.
Sandeep Reddy: Now turning to our outlook for 2025.
Sandeep Reddy: We continue to believe the global retail sales growth should be generally in line with 2024.
Sandeep Reddy: As part of that we expect the following.
Sandeep Reddy: First we continue to expect our U S comp to be 3% and that it will be lower in the first half compared to the back half due to the timing of our initiatives.
Sandeep Reddy: Can be rented macro pressures persist it could put pressure on achieving this number.
Sandeep Reddy: Second.
Sandeep Reddy: We continue to expect 1% to 2% International same store sales growth as there continues to be macro and geopolitical pressures that exist around the globe and we believe this could impact our business.
Sandeep Reddy: We expect operating profit growth of approximately 8%, excluding the impact of currency and approximately $5 million severance expenses.
Sandeep Reddy: Related to our organizational realignment.
Sandeep Reddy: A couple of points of additional color.
Sandeep Reddy: While we are expecting some savings as a result of the organizational changes that were being made.
Sandeep Reddy: We are planning to reinvest most of these savings back into the business.
Sandeep Reddy: And our U S business, we source most of our food products from within the country. So we're not expecting tariffs to have a material impact on our operating profit.
Sandeep Reddy: Thank you we will now open the line for questions.
Sandeep Reddy: Certainly and our first question for today.
Sandeep Reddy: It comes from the line of.
Daniela: Daniela <unk> from Bernstein Your question. Please.
Speaker Change: Thank you.
Speaker Change: I was wondering if you can comment a bit on your statement of potential international geopolitical pressure impacting the brand. So specifically are you starting to see any pockets of <unk>.
Speaker Change: Consumer weakness in international markets or.
Speaker Change: International boycott against U S brands, specifically for Domino's. Thank you.
Speaker Change: Alright. This is sandeep. Good morning, yes, so I think in terms of the geopolitical pressure and risk that we see out there. So it's more with what's been going on in the last few months, we wanted to be very careful and mindful that there is a lot of volatility from a geopolitical perspective, there could be a potential downstream impact on demand.
Speaker Change: And Thats incorporated in our guidance I wanted to 2% for the year and Thats really the the meaning of the statement.
Speaker Change: Yes.
Speaker Change: Thank you and our next question comes from the line of Brian Bittner from Oppenheimer. Your question. Please.
Speaker Change: Sure.
Brian Bittner: Thank you thanks very much good morning.
Speaker Change: You talked about.
Speaker Change: How do you expect door dash and other third party platforms to be about 50% incremental can you talk about what type of mix you do anticipate to come from door Dash, maybe relative to what you saw with Uber eats so.
Speaker Change: Maybe we can all start to think about how you are thinking about as potential contribution to comps.
Speaker Change: Just trying to understand maybe what's required from the door dash launch in the second half to get to your guidance.
Speaker Change: 3% in the U S.
Brian Bittner: Good morning, Brian.
Brian Bittner: Yes, right now if you look at the door Dash pizza sales.
Brian Bittner: Business on their platform versus Uber, it's about <unk>.
Brian Bittner: So we're not going to put out specific goals by quarter like we did with <unk>. We were just starting with aggregators at that time.
Brian Bittner: Think about the aggregator business now as part of our delivery business, but as far as contribution you should expect about <unk> four dash from what we saw with it.
Sandeep Reddy: And as Sandeep said in his remarks, we're really expecting this to be kind of in the second half of the year.
Speaker Change: Thank you and our next question comes from the line of David Tarantino from Baird. Your question. Please.
David Tarantino: Hi, Good morning. My question is on the stuffed crust pizza platform.
Speaker Change: You mentioned it did not have much of an influence on on the first quarter.
Speaker Change: But at the same time, you are pleased with what Youre seeing and it's in line with expectations and I was just wondering if you could elaborate on what that platform is doing out relative to sales mix or what youre seeing in terms of the lift to the comps.
Speaker Change: Els you could offer there thanks.
Speaker Change: Yeah. Thanks, David Yeah, we were talking about as far as performance as we launched it with three weeks ago in Q1. So it just it didn't have a.
Speaker Change: Oversize impact in Q1.
Speaker Change: Can tell you is as we look back to the launch so far we're really pleased with how things are going a significant amount of orders are going out with stuffed crust pizza as a consumer feedback on the quality is.
Speaker Change: We're really where we wanted it to be and our stores are performing very well from an op standpoint. So all in all we're pleased and it's hitting our expectations.
Speaker Change: Youll recall.
Speaker Change: It's about 15% of mix of our competitors and so we'll see where that falls in for us but.
Speaker Change: That means it's a big opportunity. It's the biggest cross type we werent yet so we're very excited.
Speaker Change: Thank you and our next question comes from the line of David Palmer from Evercore ISI. Your question. Please.
Speaker Change: Thanks.
Speaker Change: Russell just just to follow up on that on the stuffed crust you mentioned, it's 15% of competitors I would imagine you wouldn't be targeting that mix overnight.
Speaker Change: Sometimes we see new products.
Speaker Change: <unk> been have a honeymoon period, where the trial is extremely high so.
Speaker Change: I'm wondering what is your expectation any comments about the mix initially and the incremental <unk> of that mix and how you see that product, perhaps evolving on those two on those two scores.
Speaker Change: Yeah. Thanks, David we have lawyers on the other end of the table poised to jump in front of me if I give any forward looking information.
Yes.
Speaker Change: Look you talked about exactly what we look at with new product launches, especially one of this magnitude is it's not just going to be as a percent of mix, it's going to be the incrementals, both in orders and in dollars and as soon as we get more information on that and we want to look at repeat.
We will be able to give a better sense of what that looks like I think for me.
Speaker Change: What's important about stock price in addition to how many.
Speaker Change: So we're going to sell is when you think about our first pillar of most delicious food.
Speaker Change: Not just about launching new products, it's about launching products to give a halo to the brand on Deliciousness and I think what we're going to see from stock prices not only stuff cross sales.
Speaker Change: But a nice halo to the brand.
Speaker Change: On the Deliciousness pillar.
Brian Bittner: Dave I'm, just going to go back to I think a question that Brian asked earlier on <unk> and now stuffed crust and.
Brian Bittner: And essentially all of the initiatives that we've talked about in the February call and again, we are talking about them on this call. All of this is incorporated in terms of our expectations in the 3% guidance that we have on same store sales for the year and the backend loaded comps reflect the timing of initiatives. So it's all contemplated.
Brian Bittner: And that's there.
Brian Bittner: We don't want to get into specifics at this time in terms of where we are so far in the second quarter. Just know that we know what our assumptions are based on what we've seen.
Anne: Thank you Anne.
Speaker Change: Next question comes from the line of Dennis Geiger from UBS. Your question. Please.
Speaker Change: Great. Thanks, guys Sandeep, it where Russell I wanted to follow up on the comment you just made on that U S sales outlook and they reiterated 3% comp guide.
Speaker Change: Specifically, if any additional thoughts on key initiatives to accelerate and help you get there you touched on stuffed crust and door dash of course, but just anything else on some of the other initiatives as we think about loyalty maybe another new item coming promotions marketing calendar, just how impactful some of that can be and you expect it could be as as you work through the year. Thank you.
Speaker Change: Yes, Thanks Dennis.
Speaker Change: Every year, we go into.
Speaker Change: The year strategically with the same intent to execute against hungry for more so year over year.
Speaker Change: Again without giving too much forward looking information, we can look to our guidance, which says two new products a year from a value standpoint pretty much the same amount of of booths.
Speaker Change: <unk> says we did prior year.
Speaker Change: I get really excited about too is just the value that we're going to be bringing forward. The renown value platform. We talked about in 2003, when we last talked with you for more and we felt for a couple of years a few years that this is.
Speaker Change: It really going to be a platform that was going to be important for all of <unk> and while <unk> has been really kind of driven by price.
Speaker Change: It's been great about our value our value creates what I call I'll talk value, it's not just a price point.
Speaker Change: It's things like Carryout tips, its emergency pizza things that folks talk about so I can't get into the initiatives, but I can tell you is.
Speaker Change: The strategy is an open book and I think if you look at the last couple of years, what you'll see is yes, we don't tell you the initiatives in advance, but they absolutely fit with our strategy and thats going to continue.
Speaker Change: And then also this.
Speaker Change: You mentioned loyalty, specifically and look we have said before and we've continued to say that it's a multiyear driver it's been.
Speaker Change: I've been in the past and we expect it to be that case over here as well in particular, I think theres new loyalty program is structured around the carryout customer, giving light light users coming in and really those are going to be massive frequency builders for us as we go along.
Speaker Change: Literally last year, we grew by $2 5 million active members in our loyalty database.
Speaker Change: And we continue to see good traction from that and I think where we expect to see momentum as future sales from those acquired customers taking on to our drove Brian Yes, I think thats important sandeep.
Speaker Change: First of all I see program. We introduced in 2015, we have that are out for seven years and it was seven years of really step and a half years.
Speaker Change: Nice growth and then what we did when we updated we said okay. What are the couple of things we need to do to make it even better.
Speaker Change: We had the price four points lower so that really help with carrier customers for their ticket is lower and we also.
Speaker Change: Really pushed to make sure that the program.
Speaker Change: Activated against lighter users. So you used to have to buy a six times and now you can bias as few as two times. So it's important and I say this because we've done it before understand that things like loyalty or really a multiyear driver things like the aggregators. Once we're on the aggregator platform, we intend to grow our business on that platform.
Speaker Change: Just like we grew our business outside of the platforms and so it's really important to see certainly while we're leaning in here. These are drivers that are going to continue for years to come.
Speaker Change: Thank you and our next question comes from the line of Peter Saleh from <unk>. Your question. Please.
Peter Saleh: Great Good morning.
Peter Saleh: Thanks for taking the question I wanted to ask about the domestic unit growth I think the prior guidance was 175.
Peter Saleh: Net stores in 2025, and the impact of tariffs on construction costs can you guys give us a sense on what youre thinking there and are you seeing any availability issues on some of the critical components that you need for.
Peter Saleh: For unit development, just trying to understand the confidence behind the domestic unit growth guidance, given the tariff impact.
Peter Saleh: Yes. Thanks for the question look I mean, I think from a from a domestic unit growth guidance perspective, no change up are you expecting the 175 stores that we talked about on the on the last call.
Peter Saleh: Frankly speaking.
Peter Saleh: The more we actually went through the cycle of earnings and in the fourth quarter. It was really apparent.
Peter Saleh: The economics of our franchisees are best in class and the returns are really compelling for them and we continue to drive market share to Russell's point earlier. The pipeline is very robust the appetite from our franchisees. There is very good and I think from a tariff perspective, if there is any impact it should not be material enough for it to actually.
Peter Saleh: Demand and so the enthusiasm that the franchisees have to continue to grow the stores is very strong and we are very supportive of what we need to do to make sure there will be.
Peter Saleh: This is growth.
Peter Saleh: The pipeline for the U S is.
Peter Saleh: Better than it was at this point last year, and so where we are.
Peter Saleh: Very excited about what we've got in front of us.
Speaker Change: Thank you and our next question comes from the line of Gregory Frankfurt from Guggenheim. Your question. Please.
Speaker Change: Hey, Thanks for the question.
I'm curious.
Speaker Change: Just on the aggregator platforms <unk> been on for a little over a year.
Speaker Change: Are you seeing from customers in terms of either frequency or <unk>.
Speaker Change: Check size I'm, just curious how the customers behave now with some time versus customers who are coming through other channels.
Speaker Change: Yes, I think.
Speaker Change: The biggest difference.
Speaker Change: To me is more the group size, there's probably a little bit smaller group, maybe a single or one or two customers versus.
Speaker Change: When folks go to our website.
Speaker Change: For a bigger part of the occasion, so Greg I think that probably would be the biggest piece. Obviously this platform still is even though theyre higher income customers is still as promotional as sensitive.
Speaker Change: The best deals.
Speaker Change: Customers are still on dominos dot com, but they are promotional sensitive.
Speaker Change: Sensitive as well so I think the biggest thing I think.
Speaker Change: It would be that.
Speaker Change: Yes.
Speaker Change: Thank you.
Speaker Change: Next question comes from the line of Chris <unk> from Stifel. Your question. Please.
Speaker Change: Yes, thanks, good morning.
Speaker Change: Russell the U S brand the best deal ever I guess for a significant amount of significant number of weeks during the quarter just given the strength of that offer I was hoping you could provide some more context around how it impacted your sales trends and maybe how it performed relative to the segment during the period.
Speaker Change: Yes, Thanks, Chris I'll give you a little background about the name of that Delever. The team came in and showed sandeep.
Speaker Change: What would the deal wasn't a reaction to literally was wow, that's the best deal ever. So there you go Thats free naming research there how.
Speaker Change: We came up with it.
Speaker Change: I want to talk about the strategy of best Delever, because I don't think we spent enough time doing that the insight for us is within the <unk> our industry right now obviously there've been a couple of years of.
Speaker Change: Pricing taken and so what youre seeing with a lot of restaurants as theyre dealing it back, but theyre dealing it back really maybe not necessarily things that folks want.
Speaker Change: Maybe you want the big item, but you can get a little item or the side item.
Speaker Change: So other than the price being really good with best deal ever.
Speaker Change: It was any crust any topping no limitations.
Speaker Change: And I think that to me other than just the price point was a big way of us leaning into customers and saying we hear what you want you just don't want something that is low in price you want something that's fair price for what you want and so that was a big deal for us I think thats it.
Speaker Change: Big category in sight.
Speaker Change: Is it only ran for a few weeks and there are obviously headwinds.
Speaker Change: The remainder of the quarter. So it was kind of hard to break that out but what I can tell you is I'm really pleased with the performance and the statement that we made by doing it on top of that I'm really proud of our franchisees.
Speaker Change: Because they leaned into this I mean, the last time, there was close to a $10 offer out there.
Speaker Change: And in Pizza was a long time ago, and so our franchisees does two things one that talks to the confidence they have in the analytics from our team, but also it talks to the profitability they have and their ability to lean in probably when other folks can't and that we're going to have to sustainably lean in.
Speaker Change: And for a while there and I think this is a great example to prove that our franchisees are up for it.
Speaker Change: Thank you and our next question comes from the line of Sara Senatore from Bank of America. Your question. Please.
Sara Senatore: Thank you.
Sara Senatore: Can you ask I think about a comment that sandeep made with respect to the U S outlook and just.
Sara Senatore: Yes that is macro pressure persists.
Speaker Change: Implications for that same store sales number I guess I have struggled a little bit with trying to figure out what's happened in the first quarter, just because there's been weather and calendar shifts and I think even something like Valentine's day would affect you.
Sara Senatore: And so to the extent that the.
Speaker Change: The guide.
Speaker Change: Kind of requires an acceleration in comp.
Speaker Change: Just trying to understand what it is that youre seeing in the macro backdrop, if it's softer than it was at the end of last year and it does that require an improvement.
Speaker Change: From here to hit that 3% and I guess, what are you looking at to get that because again some of the macro data actually looked pretty yes, I would think salutary, Jimmy so any kind of insight into that comment and kind of what the underpinning expectations might be.
Sandeep Reddy: Yes, I'll start off and then I'll kick it off to Sandeep I think part of it was just looking at the <unk>, we had for the year and so we knew our initiatives were a little bit kind of back half loaded and that's part and parcel of it and then also what we're overlapping in Q1, if you remember last year.
Speaker Change: In Q1.
Speaker Change: Coming in strong with loyalty, we have brought back Carryout special for the first time. So a lot of this was really kind of at that categorization of how things were going to fall and how we think we're going to get to that 3% in the U S.
Speaker Change: I think Russell is exactly right in front of me.
Speaker Change: First quarter came in pretty much at our expectations, maybe a little bit off but we knew the macro was going to be tough and we expect the macro to be tough this year, but what we're actually saying is.
Speaker Change: If there's a further deceleration of the macro environment that could put pressure on the business and I think thats really what we are pointing out over here.
Speaker Change: Other than that I think the starting point is it's a tough macro and thats how have you built up.
Speaker Change: I would just add I think.
Speaker Change: Yes.
Speaker Change: Kind of common sense here, when we talk about those macro headwinds isn't on Domino's specific we think these are <unk>.
Speaker Change: Headwinds, which is why in addition to hitting our algorithm.
Speaker Change: We are happy.
Speaker Change: For the year.
Speaker Change: On U S same store sales are up 3%, while Q1 wasn't what I had hoped it would be.
Speaker Change: We still grew market share right and so at times, where maybe there are extra headwinds if youre continuing to grow market share. It gives you a sense of when things open up we're going to continue to grow that market share in.
Speaker Change: Our category grows in and there are benefits so.
Speaker Change: When sandy was talking macros, either without ones that are specifically the domino's and I would argue we're probably in a better.
Speaker Change: A better capability to compete.
Speaker Change: And then many others within those backwards.
Speaker Change: Thank you and our next question comes from the line of Andrew Charles from TD Cowen Your question. Please.
Speaker Change: Great. Thank you.
Speaker Change: Wanted to ask you you talked about 50% Incrementals now for just third party delivery in general as you prepare to launch store to ask how do you ensure this doesn't density instrumentality of Uber.
Speaker Change: If it were if it were to essentially it's going to be challenging to get that 3% comp for the full year.
Yes, Andrew.
Speaker Change: <unk>.
Speaker Change: This is now all of this is encompassed in our overall delivery business and we want to be where our customers are and so if a customer decides.
Speaker Change: I know they love Domino's pizza, but now that we're going to be on both of these big platforms. I don't think the decision to go on a door dasher maneuver is going to be based on Domino's, it's going to be based really on their loyalty to that platform again, we're going to try to do everything we can to bring them back to domino's, but if they're if they wanted to buy us on door dash.
Speaker Change: That's that's because of their natural behavior on that platform and I don't really think there's anything we can do here, which is why we're okay. That's why we've priced the way we have and Thats why really our strategy for Aggregators has been to meet customers, where they are whichever avid Sara and Andrew.
Speaker Change: Add on I think we've mentioned this on the last call, but I wanted to come back to this.
Speaker Change: We are looking at our delivery business and our delivery business includes our own channel. It includes the aggregator platforms and as we look at the business. Overall, we're just going to talk about it very holistically I think last year, we gave a mix because first year on Uber and that we wanted to actually give that visibility, but I think as we move forward. This year, we're not going to be talking about mix.
Speaker Change: We're going to be talking about our overall delivery business and we're telling you strategically.
Speaker Change: Those are coming on to the platforms.
Speaker Change: What's coming in but I think overall delivery businesses. However.
Speaker Change: <unk>.
Speaker Change: Thank you and our next question comes from the line of John <unk> from Jpmorgan. Your question. Please.
Speaker Change: Hi, Thank you.
Speaker Change: Question is on the overall delivery same store sales and especially in the context of <unk>.
Speaker Change: <unk> beyond 25 that.
Speaker Change: Do you have a plan to put more assets in the ground to basically serve more delivery customers. Even if delivery overall has been relatively choppy over the past couple of years. So I just wanted to get your sense, maybe theres been some evolution of.
Speaker Change: How franchisees think about putting more new assets in the work.
Speaker Change: And the ground excuse me, especially yes.
Speaker Change: New stores are largely getting their delivery sales at least initially from other nearby outlets.
Speaker Change: Yes, good morning, John.
Speaker Change: Interesting thing when you think about the store growth in the U S. About two thirds of the stores, we have to build are going to be splits.
Speaker Change: About one third of it going to be green space.
Speaker Change: Yes.
Speaker Change: The interesting thing one would think sandy.
Speaker Change: And even I had this argument when he first started it now now sandeep.
Speaker Change: Have you seen the way and he is here.
Speaker Change: Hi to everybody.
Speaker Change: The interesting thing is when we split our store 80% of the carrier customers are incrementals, so even though youre talking about the same kind of polygon for the store customers just like delivery drivers don't want to drive as far to pick up their pizza, So believe it or not the impetus in our store split.
Speaker Change: Has nothing to do with delivery not nothing but a lot to do with Carryout and now our carrier volumes are such that the store essentially pays for itself at breakeven from Carryout then is when the delivery business starts to.
Speaker Change: It starts to become a significant because what happens is you just like customers get closer to your store your delivery customer delivery drivers get closer to your customers and so their route times are shorter they are more efficient.
Speaker Change: More predictable so you got hot predictable deliveries, which we know that's what drives reorder kits.
Speaker Change: Tips are higher and so delivery actually gets more efficient, but the reason for the split.
Speaker Change: First off is Carryout. We've also talked about obviously, you've seen our carryout business grow, but our carryout share isn't worth isn't where our delivery share is and so I still think there's lots for us to go there and a lot of that is going to be due to two.
Speaker Change: I was going to happen from store growth.
Christine Cho: Thank you and our next question comes from the line of Christine Cho from Goldman Sachs. Your question. Please.
Speaker Change: Thank you.
Speaker Change: So I think you called out Canada region.
Speaker Change: Strength in the quarter.
Speaker Change: Has that trend sustained throughout the quarter or have you seen any meaningful shifts through.
Speaker Change: The quarter and my real question is with most of DTE ton closure is largely behind and Youre seeing some improvement in the international markets in first quarter. Do you think there is a room or a path to international unit growth reached.
Speaker Change: Celebration in the next few years. Thank you.
Speaker Change: I'll take I'll take the Canada, one I'll have certainly talked to the international store algorithm.
Speaker Change: We're really proud of what they are doing up in Canada now I think.
Speaker Change: What youre seeing is there they've really embraced hungry for more.
Speaker Change: Some of the drivers there.
Speaker Change: The first quarter for them were ones that were doing here in the states. We are now in value being.
Speaker Change: A big piece of it I'll launching with AG.
Speaker Change: Aggregators being a big piece of it obviously now this gets into a little bit Q2, but they've launched the stuffed crust pizza and so what Canada is proving that we think more and more of our international Master franchisees are going to recognize is that hungry for more really is a global strategy that kind of impact.
Speaker Change: Positively in all of our markets you want to talk.
Speaker Change: So I think.
Speaker Change: On the stroke on slightly like we were expecting the BP closures that happened in Q1, I think DB themselves can signal.
Speaker Change: They were expecting to have about $200 stores closing in Q1, mostly from Japan, which happened.
Speaker Change: But I think what's been a pretty consistent all along.
Speaker Change: The more recent quarters is very strong trends in India and Japan.
Speaker Change: That has continued to be the case.
Speaker Change: And then I think outside of DTE, India, Japan, all of the markets broadly are tracking to our initial expectation. So things are very healthy and frankly, when we looked at the 24.
Speaker Change: The the paybacks still pretty good when you looked at all the international markets.
Speaker Change: The board so we feel pretty good on everything except for the Domino's Pizza enterprises presence that they were but they are working through.
Speaker Change: As we said we think the VP closure should be mostly behind us as we get into 2026, but I think their CEO and their team are working on the opening plan to make sure that what it was towards the duals are sustainably profitable stores. So that we don't have to go down this path again, having to close stores that are unprofitable.
Speaker Change: So thats kind of where we are we still in the wait and see mode. I think we will have to get through.
Speaker Change: Through this year and see how it makes updates to their algorithm.
Speaker Change: Thank you and our next question comes from the line of Lauren Silberman from Deutsche Bank. Your question. Please.
Lauren Silberman: Thank you very much so just to clarify and then I have a question on carryout, but the clarification is on breathing increments.
Lauren Silberman: Do you expect incrementally at 50% now with your Domino's direct customers or is it lower incremental D. A function of multiple partnerships and then my actual question is on the Carryout comp so a bit of a deceleration to 1% in the quarter and I know theres a lot of noise with broadband industry. You guys are talking about softness over the last few quarters, primarily with one.
Lauren Silberman: <unk> delivery. So can you just expand on what youre seeing with the Carryout customer this quarter relative to recent quarters. Thank you.
Speaker Change: Yes Laurent.
Laurent: You answered your own first question. So we'll give you that second question.
Speaker Change: As well, but yeah no absolutely. It's once once we're going on more aggregator platforms. It's.
This brings especially door dash, which is <unk>.
Speaker Change: <unk>.
As far as pizza orders, that's what's driving the incrementally closer to 50%.
Speaker Change: And then on the Carryout business it was a little bit about what I was talking about earlier it was more due to the timing of the calendar. So if you think about last year in Q1, we brought.
Speaker Change: Brought back hadn't done it for a long time Carryout special and so we're lapping that and we were lapping.
Speaker Change: Really part of the introduction of our new loyalty program that came in and we really hard into carrier customers. So I think a lot of that was really born to that timing in <unk> than it was.
Speaker Change: Anything specific that Carryout, we expect to grow both our carryout and delivery businesses. This year.
Lauren Silberman: Lauren I'll go back to something I said on the Q4 call.
Speaker Change: As we look at the 3% comp.
Lauren Silberman: I expect it to come.
Lauren Silberman: Roughly equivalent plea from delivery and Carryout. So this was not hugely different from our expectations in terms of the split of comp that we saw in the first quarter and I think with the rebuild is now announced obviously thats going to be a bit of a tailwind on delivery as we go through the year and so overall for the year, that's our expectation.
Lauren Silberman: <unk>.
Lauren Silberman: Okay.
Speaker Change: Thank you and our next question comes from the line of Jon Tower from Citi. Your question. Please.
Jon Tower: Great. Thanks for taking my questions clarification, I hate to beat a dead horse and then a question on the Dash just to make sure we don't come away with the wrong expectation for dash itself two times aside 50% incremental so a 3% contribution run rate is the way we should think about that that's the clarification and then the question is on the stuffed crust pizza.
Jon Tower: I know it only came out in the medium size and I believe that's the only size thats available today can you speak to why that's the case and if and when you plan on expanding to different sizes across the system in the U S.
Speaker Change: So I think I'll talk first about the the sizing.
Speaker Change: On a modeling question, but you had a correct, yes, it's two to emphasize Aruba and 50% incrementally.
Speaker Change: You can take the gross number as being two times the size of the ruble, but with the incremental would be at 50% would actually create a little bit less than two times in terms of the incrementals will be from <unk>.
Speaker Change: Yes, and with regards to stock price I think there are a couple of things one is and.
And we haven't really talked about this a lot we use a completely different DAU for our parmesan stuffed crust and we do our regular hand tossed.
Speaker Change: And that though right now comes in a medium size its more kind of a buttery flavor, Joe but the reason we want to lean into that particular, one and also because of the price point. It allows it allows us to have an upcharge to our mix and match promotion, which is about a $4 upcharge. So it's not only in order to drive.
Speaker Change: But it's it's a ticket driver so yes, Steph cross it was it was really more for that reason because of the unique Joe and the desire on price points, but we're going to continue to watch and see what consumers are looking for.
Speaker Change: Thank you and our next question comes from the line of Brian hardware from Morgan Stanley. Your question. Please.
Brian Bittner: Yes, Thanks, good morning, guys Sandeep so.
Speaker Change: On the international side.
Speaker Change: Is your expectation on units.
Speaker Change: Any closures going forward therefore be just more normal course, so you still feel good about sort of the previous comments you've made.
Speaker Change: Kind of similar net unit openings this year versus last year and then.
Speaker Change: Just on Canada.
Speaker Change: Kind of the macro impact on international same store sales.
Speaker Change: I mean, you've embedded I guess, a little bit of a sequential deceleration.
Speaker Change: That reflected there.
Speaker Change: Probably could be some macro pressures there <unk> seen that.
Speaker Change: Sort of more recently or can you clarify that.
Speaker Change: Yeah.
Speaker Change: Thanks, Brian So congrats to the two parts of this first of all on the units, yes with the size of the portfolio that we have in the store.
Speaker Change: We have some normal closures would be normally in costs and that we would expect to see that for the remaining three quarters of the year all of that's already in the guidance. We provided at the beginning of the year to be roughly in line with last year from a Mexico perspective, So that's <unk>.
Speaker Change: News to be our expectation.
Speaker Change: And then in terms of the macro impacts and I think theres two things there is a macro and the geopolitical book.
Speaker Change: When we actually take a look at what's going on there is a lot of volatility in there.
Speaker Change: For the global marketplace.
Speaker Change: And I think just from a macro and a consumer sentiment perspective that can have an impact on consumer demand and I think in addition to that there's also the geopolitical volatility thats ongoing or on the tariff conversation that's happening right now. So so I think when you take a pick it all into consideration, although thats incorporated in the one 2% expectation.
Speaker Change: We have for the year, and obviously that bakes in some level of sequential deceleration relative to the first quarter, because we just experienced.
Speaker Change: Okay.
Speaker Change: Thank you and our next question comes from the line of Andrew <unk> from BMO capital.
Speaker Change: Markets Your question please.
Speaker Change: Hey, good morning, Thanks for taking the question.
Speaker Change: You talked about reinvesting some of the savings from the restructuring.
Speaker Change: Or is that reinvestment going what are the what are you prioritizing in terms of the reinvestment and if you're able to quantify it that would be helpful as well. Thanks.
Andrew Charles: Andrew I think.
Speaker Change: So I think I've talked about.
Speaker Change: The areas of the P&L that we have been consistently invest against since since the time, we talked about at Investor day, and it's really consumer technology store technology capacity investments and we continue to focus on making sure that we are making investments in those areas to drive the business in the future.
Speaker Change: That's really what I would actually give you we're not going to get into specifics in terms of.
Speaker Change: On the savings reimbursement.
Speaker Change: And I think it's all incorporated effectively in the guide of profit growth that we gave you.
Both in terms of this year, but there is no change in expectations do the 8% profit guide that we provided last time as well for 2026.
Speaker Change: Okay.
Speaker Change: Thank you and our next question comes from the line of Jeffrey Farmer from Gordon Haskett. Your question. Please.
Speaker Change: Yes, good morning, and thanks, I'm just curious what your exposure to both the lower income and Hispanic customer demographic is in the U S and I guess more specifically.
If you could share anything about the relative same store sales performance of those demographics again, specifically lower income and Hispanic.
Speaker Change: And the most recent quarter.
Jeffrey: Yeah Jeffrey.
Jeffrey: Lower income customer does not.
Jeffrey: A domino's customers at pizza customer, it's a <unk> customer so its something thats.
Jeffrey: A big part of that would be part of this category. When we look I think specifically in our <unk> business.
Jeffrey: What how it's how they're being affected is not really necessarily.
Jeffrey: Leaving dominos to go to another brand.
Jeffrey: Or leaving Domino's in general it just may be an occasion here or there and what ends up happening.
Jeffrey: It's kind of similar it for the consumer breakout so you talked about it they'll just be eating it they'll be eating at home.
Jeffrey: Which really just maybe gets me to a bigger point that I just want to make sure I make with everyone today, which is.
Jeffrey: I believe significantly.
Jeffrey: I believe theyre, starting in 'twenty, three and when we when we launched hungry for more if the kyocera business over the near term is going to.
Jeffrey: Being pressured.
Jeffrey: Pressured into sustained offering sustained value because thats what customers are looking for and that's the pressure I don't worry about.
Jeffrey: I think our franchisees.
Jeffrey: Bring it on we want we want to be the ones to offer that value for customers. Since we are set up to do that we've got a bigger kind of supply chain purchasing.
Jeffrey: Our ability than anyone in pizza, which allows us to give.
Jeffrey: Our franchisees, who can then give customers a really good value.
Jeffrey: Secondly, when you when you have low prices you want to drive a lot of volume how do you do that you do that with advertising, we've got a half a billion dollar plus advertising budget that nobody else has and we also have franchisees with best in class economics that can see this through over the long term and so.
I think when we talk about that customer you should know I don't think that's going to change anytime soon.
Jeffrey: What I know we can do is we can sustain that and we will do I think has actually come out of this even stronger so you'll see what we're going to I believe continue to grow share and then we're bringing in these customers to a domino's pizza that from a service perspective from a digital perspective from a new product perspective is it better dominoes.
Jeffrey: And we were two years ago.
Jeffrey: Yes.
Speaker Change: Thank you and our next question comes from the line of Jeff Bernstein from Barclays. Your question. Please.
Jeff Bernstein: Great. Thank you very much Russell in the press release in a couple of times on the call you referred to the market share gains.
Jeff Bernstein: So seemingly growing share despite in the U S at least modest negative comps.
Jeff Bernstein: I would think that demonstrates perhaps ongoing maybe pizza category fatigue that you've talked about in the past impacting the entire category.
Jeff Bernstein: That's compounded by more challenging macro so I'm just wondering how you see the category in terms of whether that fatigue assists or whether or now it's more just a challenging macro.
Jeff Bernstein: And as you just mentioned if youre able to still grow market share gains in coming quarters and years, despite at least near term negative comps.
Jeff Bernstein: That's all unit growth led so.
Jeff Bernstein: And I think Sandeep reiterated the unit growth guidance for U S and international for this year, but it was just confirming thank you.
Jeff Bernstein: Yes, Jeff I definitely would not call it pizza fatigue at all.
Jeff Bernstein: And in this business almost 17 years now and essentially pizza grows 1% to 2% every year, we maybe have been on the lower side of that in Q1, but retail sales because you're right. It's same store sales plus store opens for us.
Jeff Bernstein: Positive.
Jeff Bernstein: So this is a category that's been very very consistent that we wanted to be clear there is nothing really happening with pizza that hasnt happened over prior year from a.
Jeff Bernstein: Growth perspective, and Thats why the continued share growth.
Jeff Bernstein: It is really important.
Jeff Bernstein: I'll point out that folks if you think about us because we are the number one pizza player.
Jeff Bernstein: Were still slightly short of one in every four pizza sold in the U S of the Domino's Pizza, if you think of other categories burgers in Mexico.
Jeff Bernstein: Uh huh.
Jeff Bernstein: The other number one brands are significantly higher and so this is not a short term thing.
Jeff Bernstein: That is going on here.
Jeff Bernstein: <unk> share growth to continue to happen in a category thats going to continue to grow we believe like it has.
Jeff Bernstein: One 1% to 2% over time.
Jeff Bernstein: Lastly, the interesting dynamic within pizza is about 40 plus percent of the competition are locals and regionals, which don't have anywhere near the.
Jeff Bernstein: That capability is to lean into value long term like we do.
Jeff Bernstein: And so when we look forward we see.
Jeff Bernstein: Lots of run room for growth on this U S business.
Jeff Bernstein: And Jeff I think.
Jeff Bernstein: Youre right.
Jeff Bernstein: Sorry, Russell was right sorry, yes.
Jeff Bernstein: None of them right.
Jeff Bernstein: Sandy.
Jeff Bernstein: We want to do percent historically.
Jeff Bernstein: Look forward to the future the average rate that we're expecting for the pizza category, but.
Jeff Bernstein: Specific to Q1 actually more than on the low end I think we actually looking at roughly flat for the quarter.
Jeff Bernstein: It's for one quarter. So I don't think we read into it too much but I think in the circumstances are one 3% retail sales, we feel really good about because we gained share in a very tough environment.
Jeff Bernstein: Okay.
Jeff Bernstein: Thank you.
Speaker Change: Next question comes from line of Alexander Slagle from Jefferies. Your question. Please.
Speaker Change: Thanks for the question.
That epsilon door dash in the initial announcement.
Speaker Change: Called out tapping into the incremental customers I guess, especially in the suburban and rural markets.
Speaker Change: If there was anything to that.
Speaker Change: There are specific implications on the development opportunities maybe further from the core and maybe that gets a bit to what John having co is asking but.
Speaker Change: And also I guess, what does that mean for your delivery efficiency issue.
Speaker Change: Perhaps that drivers fulfill orders are there.
Speaker Change: Yes.
Speaker Change: We are not going to be changing our delivery kind of drive times in order to bring this answer I want folks to understand that this is not we're not going to be driving any any further because we know the number one thing that deals that is currently with repeat a couple of things are the <unk>.
Speaker Change: Consistency and delivering high product and so what this does do though is it helps our kind of rural.
Speaker Change: And suburban stores, whereas maybe Uber helped a little bit more on the on the urban side and so by being on both Aggregators now.
Speaker Change: I think we're going to see really more of a uniform hit <unk>.
Speaker Change: One two punch across all of our stores because of that.
Speaker Change: Thank you and our next question comes from the line of Zack <unk>.
Speaker Change: From Wells Fargo. Your question please.
Speaker Change: Hey, good morning, I know youre, not giving Uber mix, but just curious if it's still improving quarter over quarter or perhaps reaching a stabilization level and then separately could you talk a bit about the performance our take rate on the sweep today versus last year and in the past and considering the macro die.
Speaker Change: <unk> today, just want to gauge the appetite or opportunity to consider stepping up to this weeks later this year.
Speaker Change: Okay.
Speaker Change: So exactly I think Uber makes like I said earlier, we're not going to really be talking about mix anymore going forward.
Speaker Change: Let's just say we are very happy with our overall business in the first quarter.
Speaker Change: Is it at that.
Speaker Change: And in terms of the performance of <unk> I'm, just going to go back to the strategic imperative that drives the most weeks these are customer acquisition vehicles.
Speaker Change: As far as rig concerned it is doing a great job in terms of being a customer acquisition vehicle and it continues to be something that we look at it and whether it's a 50% online only or the carrier. So carryout special boost week those are still very very compelling opportunities for us to acquire customers into the brand. So that's how we're looking at it.
Speaker Change: We said.
Speaker Change: Roughly in line with what we did last year for boost tweaks that statement still holds yes.
Speaker Change: Just to your point I don't.
Speaker Change: It will be roughly in line.
Speaker Change: See a significant increase in boost weeks, we wouldn't want to start training our customers to look for that long term there is value.
Speaker Change: And for this thing to be special.
Speaker Change: <unk> 52 week calendar always.
Speaker Change: Offering value we need to be.
Speaker Change: Really thoughtful with where we put.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Thank you and our next question comes from the line of Logan from RBC. Your question. Please.
Speaker Change: Hey, good morning, guys. Thanks for taking the question I just had one question on the competitive intensity in this space I think you guys called it out last quarter.
Speaker Change: Just curious how that sort of trended in Q1 and then.
Speaker Change: Any sort of impact you guys are seeing from the Burger <unk>.
Speaker Change: Elevated discounting starting in January.
Speaker Change: Yes.
Speaker Change: In Q1 interesting enough within the pizza competition and Thats, probably due to the fact that folks for knowing that we were coming out with stuffed crust. We had two of our three competitors come up with a stuffed crust so you've got that.
Speaker Change: Happening as well as just.
Speaker Change: Discounting throughout all of <unk> I think just in general customer consumer disposable income is down.
Speaker Change: And they are kind of their confidence levels I think are also down.
Speaker Change: To kind of 2022 levels and since Joe So just in general.
Speaker Change: Right now there is a headwind on the total business, but specific to us within pizza what drove those two step cross promotion.
Speaker Change: The one thing I want to add on this slogan is.
Speaker Change: With the economics that we have keep the competition price to keep up with us in terms of promotional intensity theres going to be pain in those P&L for their franchisees and it's just going to be really working more and more into our favor.
Speaker Change: It was very high in overtime Russells talk about previously we've opened up over the last 10 years 300 stores, the big National players or closed despite the less good news and I think thats really just shows what happens when you try to promote.
Speaker Change: Very intensively when you don't have the economics will be able to promote.
Speaker Change: Thank you and our final question for today comes from the line of Todd Brooks from the Benchmark Company. Your question. Please.
Todd Brooks: Hey, Thanks for squeezing me in just kind of putting a point on scale and market share gains Russell if you look back to the.
Todd Brooks: The announcement and launch of hungry for more can you talk about.
Todd Brooks: How much sure Domino's has gained in both the carrying out that delivery channel since that program has been launched.
Todd Brooks: Yes.
Todd Brooks: I guess I'll, even talk broader than that because what I'm really excited about is just how we've consistently been able to do it.
Todd Brooks: And we're at about a share point of year kind of give or take overtime in the pizza business. So.
Todd Brooks: We've got a track record for doing that.
Todd Brooks: And I think we're actually better poised to do that moving forward because of the market share we have the advertising we have.
Todd Brooks: The franchisee profitability we have.
Todd Brooks: And maybe just to kind of loop back around to the prior question, we keep talking about in the profitability of our franchisees, which we're really proud of.
Todd Brooks: And what we.
Todd Brooks: Feel pretty confident.
Todd Brooks: The profitability of some of the.
Todd Brooks: National and regional and local competitors.
Todd Brooks: I would have folks maybe maybe look at the <unk>, which are.
Todd Brooks: Something that you can calculate and that will give you a sense of what we're talking about so even if there arent profitability numbers for competition. If you look at the <unk> of a domino's.
Todd Brooks: It has more stores than any other concept.
Speaker Change: It will give you a sense of what Sandeep was talking about meaning if folks are going to compete with us with.
With less volume going through what is substantially similarly.
Speaker Change: Outlet cost to kind of keep up rent all of that kind of stuff is going to be very very difficult.
Speaker Change: Thank you Todd that was our last question of the call.
Speaker Change: You all for joining our call today, and we look forward to speaking to you. All again soon you may now disconnect.
Speaker Change: Disconnect.
Speaker Change: Yes.
Speaker Change: Thank you, ladies and gentlemen for your participation in today's conference. This does conclude the program you may now disconnect good day.
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Speaker Change: [music].
Speaker Change: Sure.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Sure.
Speaker Change: Sure.
Speaker Change: Thanks.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
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Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: [music].