Domino's reports slowing growth amid shifting consumer pizza demand

Domino's reported a 0.3% increase in same-store sales for the third quarter, reflecting a broader slowdown in the American pizza market. While the company exceeded Wall Street expectations for profit and revenue, its shares fell by more than 4% following warnings of slower growth for the remainder of the year.

Industry research from Technomic indicates that pizza is currently the slowest-growing cuisine type, having dropped from the second-most-consumed food in the 1990s to the seventh most popular. Factors contributing to this shift include changing consumer tastes and the rising use of GLP-1 drugs for health reasons. Additionally, Mexican cuisine has surpassed pizza in total consumer spending.

To combat declining demand, Domino's has engaged in aggressive discounting and promotional activities, such as the ‘Best Deal Ever’ campaign. However, executives acknowledged that these efforts have placed pressure on franchisee profitability. New CEO Joe Jordan stated that the company is working to balance driving order counts through value offers with the need to improve average ticket growth and stabilize margins.