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July 22, 2022

Labour crunch and higher costs impact Domino’s Pizza Q2 results

The company’s quarterly net income declined from $116.6m in Q2 2021 to $102.4m in Q2 2022.

Domino’s Pizza has reported mixed results in the second quarter of 2022, as the Michigan-based restaurant chain struggled with a labour crunch and higher costs.

The company’s global retail sales fell 3% in the quarter, without adjusting for the impact of foreign currency.

International same-store sales (excluding foreign currency impact) declined 2.2% during the quarter, while same-store sales in the US fell 2.9% in the same period.

The pizza restaurant chain’s revenue totalled $1.06bn in Q2 2022, up 3.2% from the recorded $1.03bn in the same period a year ago.

The increase was primarily attributed to higher supply chain revenues.

Domino’s Pizza’s income from operations in the quarter fell 6.7% on a year-over-year (Y-o-Y) basis to $178.1m, due to lower US company-owned store and supply chain gross margins.

The company’s quarterly net income also decreased $14.1m, from $116.6m recorded in Q2 2021 to $102.4m in Q2 2022.

Quarterly diluted earnings per share (EPS) fell from $3.06 to $2.82 Y-o-Y.

Domino’s CEO Russell Weiner said: “Our results for the quarter faced challenges consistent to those I outlined back in April. We continued to navigate a difficult labour market, especially for delivery drivers, in addition to inflationary pressures combined with Covid and stimulus-fuelled sales comps from the prior two years in the US.

“However, the strength of our franchisees and team members, along with the strategies we are putting into place, make me confident we are on a path to overcome these short-term obstacles and make the Domino’s brand and business stronger than ever.”

In the second quarter, Domino’s Pizza had a net global store growth of 233 stores, including 22 in the US.

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