Domino’s CEO Richard Allison said the pizza chain is aiming to open more than 2,000 new U.S. store locations over the next decade to capitalize on a long streak of sales growth.
The company, which has emphasized digital sales efforts in recent years, reported U.S. same-store sales growth of 6.9% in its second quarter compared to the same period one year ago. Same-store sales are sales at stores that have been open for at least one year.
Domino’s has posted 29 consecutive quarters of domestic same-store sales growth, even as rivals such as Papa John’s and Pizza Hut have struggled to boost revenue.
“We see an opportunity for an 8,000-store Domino’s business potential within the next 10 years,” Allison said Thursday in response to a question about the chain’s future growth. “We’ve had success gaining share. And while a lot of that share has come from the locals and the regionals, as we look forward, we see an opportunity to take share broadly across the industry.”
Jeffrey Lawrence, Domino’s chief financial officer, said the company now plans to invest $115 million to $120 million to build out its U.S. supply chain, marking an increase over previous plans for between $90 million and $100 million in spending.
Domino’s has 5,692 U.S. stores. If the chain follows through on plans for 8,000 domestic stores in the next 10 years, it will have increased its store imprint by nearly 40%.
|DPZ||DOMINO'S PIZZA, INC.||497.06||-6.48||-1.29%|
|PZZA||PAPA JOHN'S INTERNATIONAL, INC.||128.55||-0.57||-0.44%|
The company’s stock rose on Friday but initially sank after Thursday afternoon’s earnings report, as international same-store sales rose just 4%, falling short of Wall Street’s expectations. Total revenue also disappointed, rising 24% to $779.40 million against an expected $784.61 million.
Allison said he expects international sales to recover on a full-year basis.
Domino’s unveiled its preliminary growth plan just days after Papa John’s founder John Schnatter stepped down as company chairman amid public outcry related to his use of a racial slur on a May conference call with marketing executives.