Domino's Pizza (DPZ, Financial) saw a 4% decline in its stock price after ending 2024 on a down note. The company slightly missed its EPS target, with revenue growing just 2.9% year-over-year to $1.44 billion, falling short of expectations. Same-store sales were also underwhelming. However, DPZ announced a positive 15% increase in its dividend.

Key Highlights:

• US Comps: Increased by only 0.4%, below previous guidance and continuing a downward trend: +3.0% in Q3, +4.8% in Q2. Carryout sales grew by 3.2%, but delivery comps fell by 1.4%, affected by macroeconomic and competitive pressures on low-income customers. Pricing contributed 2.3% to sales, and Uber added 2.7% in Q4. A higher carryout mix, which has a lower ticket value than delivery, impacted results. Traffic remained flat, partly due to a mid-week New Year's Eve.
• International Comps: Rose by 2.7% in constant currency, slightly exceeding internal expectations. Improvements in Asia, driven by strong sales in India and Europe, were noted. DPZ continues to see strong returns in its largest growth markets, China and India.
• 2025 Outlook: While DPZ does not provide specific guidance, it anticipates continued pressure on consumer spending and a value-driven QSR market in 2025. US comps are expected to align with the long-term +3% guide, with lower performance in the first half of 2025 compared to the second half. International comps are expected to grow by about 1-2% in 2025.
• Growth Drivers: Strong store growth continues to boost market share. The revamped Domino's Rewards program and entry into the aggregator channel with UberEats are beneficial. Same-store comp growth in the carryout business was over 6% in 2024.

Overall, the quarter was disappointing for Domino's Pizza. The EPS and revenue shortfalls were concerning, but the declining US comp trend was the most significant issue. The weakness in US comps is expected to persist in the first half of 2025 due to pressured consumer spending and a more value-focused QSR market. The concerns raised by Wingstop's (WING, Financial) recent miss were unfortunately realized with DPZ.