Americans dial up more Domino’s pizzas in first quarter

Associated Press

Ann Arbor — Domino’s reported a higher quarterly profit on Thursday as an uptick in pizza orders drove up sales in the U.S.

The company said sales surged 14.5 percent at established Domino’s locations in the U.S., reflecting stronger order growth and, to a lesser degree, higher average spending per order.

CEO Patrick Doyle said the jump in sales was partly the result of an improving job market.

“Employed people buy more pizza than unemployed people,” he said during a conference call.

Other factors that have played a role include Domino’s digital ordering options that make it an even more convenient option for people, and a new advertising campaign that notes it’s dropping the “pizza” from its store names to underscore that it serves other types of food, like a fried chicken item that comes with toppings.

Domino’s is also taking market share, Doyle noted.

Earlier in the week, Yum Brands said sales at established Pizza Hut locations in the U.S. declined 1 percent. Yum CEO Greg Creed conceded in a conference call that the chain was being “outperformed by the competition.” To improve its results, Pizza Hut recently revamped its menu to lets people build their own pies with a wider range of crust flavors and toppings. But Creed said the marketing hasn’t been “as effective as we’d like,” and that the company needs to “balance its appeal to millennials with mainstream pizza customers.”

Overseas, sales at established Domino’s locations rose 7.8 percent. The Ann Arbor, Michigan-based company has more than 5,000 U.S. locations and more than 6,600 international locations.

For the quarter, Domino’s Pizza Inc. said profit rose 14 percent to $46.3 million, or 81 cents per share. Analysts expected 80 cents per share, according to Zacks Investment Research.

Total revenue was $502 million in the period, also topping the $488.3 million analysts expected.

Shares of Domino’s rose nearly 10 percent to $109.74.