卖披萨如何打造千亿市值?披萨连锁达美乐(Domino's Pizza)2024年Q4财报电话会问答部分——中英字幕 #美股 #消费 #品牌连锁

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certainly and our first question for

today comes from the line of Dennis Gyer

from UBS your question

please great good morning thanks guys uh

I wanted to ask a bit more on the the

2025 guidance for the US same store

sales I guess specific to the comments

around lower first half versus back half

and and I think commentary around you

the aggregators and loyalty being the

biggest drivers could you just kind of

unpack some of the sales initiatives you

know those two in particular and and

maybe how you're thinking about new

product innovation in 25 at a high level

excitement versus prior years with those

two items that you called out um thanks

guys hey Dennis good morning how you

doing um so Dennis I think on the on the

question on the guidance and the back

half versus the first half Cadence um I

think we uh in Russell's prepar remarks

we talked about the aggregator platform

specifically that we've started

negotiating with um a potentially other

partners and that the meaningful impact

would come more in the back half from

aggregators I think so that's one piece

of it uh in terms of the weight um and I

think the the other piece of it is is

really uh we have a bunch of initiatives

that we have in our in our marketing

calendar and as you've seen we weren't

shy about rolling out a whole bunch of

them in 24 similar plans uh in 25 uh you

you know best deal ever has just been

launched earlier this quarter so uh

there's there's a whole much more that

we're waiting to surprise our compan

competition with so I'm not going to

give you more details on that but but

that's kind of how the back half versus

front front half commentary was built

yeah I think just in general uh you know

when we're asked by the way good morning

Dennis sorry um you know when when folks

talk to us about what drivers are in the

business obviously we're not going to

give you know uh specific information

but if you want to know what our recipe

is it's hungry for more and so for

example if someone were to ask me in uh

last quarter what are you going to do in

in q1 what's to be different well I

wouldn't tell them we're doing um you

know a a a 999 any best deal ever

promotion but that idea really came out

of uh the strategy of of hungry for more

so the specifics are going to change we

need to keep you guys on your

toes um but but the the drivers behind

them are going to be born out of the

hungry for more strategy

thank you and our next question comes

from the line of Brian bner from

Oppenheimer and Company your question

please thank you good morning um as it

relates to the 2025 guidance um it it

does still assume softer International

expectations which you you established

on last quarter's call with

International same store sales in that 1

to 2% range instead of the 3% plus

long-term range and and you did re

reiterate this view in your prepared

remarks this morning but I'm curious if

your International thoughts for 2025

have have changed at all over the last

several months I mean your 4 q comps

were stronger than expected we're also

seeing better International Trends out

out of a lot of your peers so I'm just

curious if this is starting to tilt

conservatively possibly or anything else

you can

add morning Brian yeah I'll start off in

Sunday feel free to feel free to add you

know like like you said Q4

uh for the competition as well uh some

of the headwinds seem to be dying down a

little bit um we're not going to make a

a flip after you know one quarter we

were pleased with with our quarter as

well what I look at are the things that

we can control and and and there I I I

am pretty happy um you know we gave a a

bunch of I'm not going to go through

them again but in my in my opening

remarks I gave a bunch of examples of

how around the world we're taking the

renowned value part of hungry for more

and We're translating it into some of

these International markets and we're

seeing results we've talked about having

to do three things to drive uh

International same store sales and I

think we're really beginning to do that

the first is making sure that our price

points are at or below CPI second is

making sure we're leveraging uh

aggregators and the third just like

we've Diversified Beyond delivery while

still driving delivery in the US we need

to do that in international markets so

happy with uh with with Q4 and as we uh

get more information um if we will

update that number we'll we'll let you

know and and what I will add Brian is um

I think in terms of the guidance on same

store sales in particular I wouldn't say

this Stills conservatively uh it is a

very tough macroeconomic environment out

there there is a lot of volatility

that's out there and that's all been

taken into consideration both in terms

of what we said at Q3 uh on the Q3

earnings call as well as what we're

seeing right now so we'll continue to

drive into the renowned value

initiatives that Russ talked about but I

think the expectations really have not

shifted materially since the last

call okay thank

you thank you and our next question

comes from the line of David Tarantino

From be your question

please hi um good morning my question is

on the US unit growth um that number I

guess missed your target for

2024 and I was just wanting to ask your

degree of confident in getting to the

Target for 2025 I guess what any way you

can frame up the pipeline or your degree

of um I guess you know assessment of

enthusiasm in terms of building new

units would be great

thanks uh thanks David yeah I think s

deep in his remarks talked about you

know some of the Hurricanes at the back

part of the year uh impacted our net

openings otherwise we would have been

essentially there um what I'm really

really happy about is um also just how

we've done relative to the uh kind of

competitive pizza places even in a year

maybe we where we didn't hit and so if

you look at you know our our um uh

competition as far as the public

companies you know you add up the number

of stores net stores that they open and

we were a multip several multiples

higher higher than that so we we we've

got more to do the Hurricanes hurt us a

little bit but net net we're still G

more share in the US and and that's what

this game is all about yeah and and I

would just add to that uh David our

economics are still very much Best in

Class the paybacks are extremely

compelling the demand for new units

continues to be very strong and with the

share that we continue to build we are

in a stronger and stronger pos position

not just against the national

competitors whose data you actually hear

about but against the regional

competitors and the local players as

well so we're super are confident that

the the pipeline is that we see is very

realistic thank you and our next

question comes from the line of John

Ivano from JP Morgan your question

please um hi thank you uh there's you

obviously been you a lot of attention

around price points under $10 you know

the $699 specials and obviously what's a

you currently pretty incredible um large

unlimited topping for $9.99 so you know

the question was really you know kind of

around that $10 price point is the brand

in a position you know to where you can

drive significantly interest in

promoting a pizza you know whatever the

number might be 12 13 $14 or for

whatever reason you know you know might

the brand have some kind of natural cap

around the $10 number where you know

consumer really getting a lot of

interest around a higher nominal price

point not value but higher nominal price

point that might otherwise constrain

them

thank John yeah you know one of the

things that you'll see in this

promotional environment and we knew this

um when we said out hungry for more and

we said we were going to dive into uh

renowned value is that is that price is

important and you know frankly there are

a lot of folks doing similar promotions

that that we do you know we had $699 and

other folks have done uh you know $699

we had emergency pizzas there've been

bogos um you talk about price points for

me the thing and and San talked about

this before is for us it's sustainable

when you look at the economics for our

franchisees um they're able to sustain

these types of price points and we saw

same store sales for other Pizza players

which were not uh in line with where

dominoes are so if you if you if you got

similar promotions and you've got you

know lower same store sales the

economics are not going to be good and

so we've got when you look at the scale

of dominoes our ability to drive volumes

through our high share of voice and

drive cost down through our supply chain

that's what enable us to do that $10 or

$9.99 is a good price point right now um

we're going to continue to Pivot to keep

consumers you know interested in in

dominoes but the big thing that's

different about us is that this is

sustainable it's part of our

strategy thank you and our next question

comes from the line of David Palmer from

evercore isi your question

please thanks um if I if I had to

summarize perhaps what investors are

excited about and and concerned about

I'd say they're excited about the

potential on this on the door Dash

expansion of marketing there excited

about stuff crust the potential to roll

that out um but they're concerned about

the long-term same store sales growth

Beyond these types of initiatives given

what they would back out from Uber Eats

from the fourth quarter and they think

gosh the underlying Trends are are are

troubled for pizza delivery particularly

one piece so I'm wondering if when you

think Beyond 26 or you know through 26

and and Beyond about your 3% domestic

comp growth Target or thereabouts you

know what are some things that you think

might ramp up in terms of its growth

contribution that would give people

Comfort at this point that you could do

that without some of these other things

uh perhaps in in that given year

thanks thanks David yeah you know we we

get that question a lot which is hey

what's coming up in future years that

makes you think that you could sustain

you know what you've done do what you're

doing and obviously we're not going to

go into uh particular programs but but

this brand has a track record this team

has a track record and you know kind of

one one SharePoint plus a year is is is

has been what we've delivered without

sometimes getting into to the specifics

of what we're doing for competitive

reasons I don't I don't think you'd want

us to but I I I said this earlier I'll

bring it up again if someone were to ask

me hey last year what do you got coming

in in in q1 I wouldn't be telling them

we've got best deal ever but I'd be

telling them the answer would come out

of our strategy of of renowned value and

so I I've been with this company 16

years you know and and and and

essentially the the the track record has

been pretty solid without us you know

giving forward information so if you

want to know what we're doing obviously

you you talked about some of the big

ones you know um expanding on the

aggregator platforms is is a big one if

you think about what our Q4 number would

have been had we been on all the

aggregators you know you're completely

right there uh loyalty is a multi-year

gain for us like we showed with the

first loyalty program but you're going

to see a company that continues to bring

you know best-in-class ideas that that

uh are differentiated based on our

strategy and we've got a track regular

to doing that so not going to get into

specific numbers other than to say or

specific names or programs other than to

say you know we we've done it and we're

going to continue to do that um moving

forward and and Dave I just add over

here like when we talk about the

aggregators and aggregator specifically

when you think about 2026 uh Russell

talked about the long term and all the

things that we can do if we're talking

about really looking at something post

May one and we have a meaningful impact

in the back up obviously there's an

analization impact that comes from the

aggregator platform uh if we actually do

do that and and then I think there's

there's more Tailwind the fastest

growing segment of the pizza qsr uh

space is the aggregator and and to

Russell's point we we we weren't on

there fully in Q4 of 24 and and there's

a lot more growths to come from there

and I think even loyalty like R talked

about the multier compounding impact the

really cool thing about loyalty the $2.5

million increment uh 2.5 increment

loyalty members that we've gained these

are light users and Carry Out users and

that becomes a huge fly bill because now

we've captured them into the database

and we can start marketing them to drive

incremental compounding impacts so this

is going to be a big fly wheel and we're

really thrilled about the carot mix in

the business as well it's very

compelling it's very strong you combine

that with the number of loyalty members

that we've gained more growth to come

and so the Catalyst that we talked about

are very consistent and they're

multi-year drivers and I think to just

to add is when you when if you listen to

some of the commentary we've got over

why we're able to sustain what we've

been able to sustain you know over the

last decade plus it's we've talked about

building scale right and the scale we've

got um in share of voice the scale we

have in supply chain that gets grown

through same store sales right so in

another year where we're winning on same

store sales another year where we're

winning on stores stores let you drop

more markets there stores let you keep

competitive stores from opening all of

that actually kind of snowballs and

drives more momentum for the future so

all the stuff that we said has worked

for us by continuing this flywheel

essentially becomes more offense for us

in the

future thank you and our next question

comes from the line of Danilo garulu

from Bernstein your question please

thank you um S I think you are you're

showing some U you know you're

displaying some very solid cost

discipline also uh in 2024 um you know

both on the supply chain as well as on

the GNA side um you you were talking

about some shifting timing on some of

these Investments so can you help us

understand which Investments have been

put out and then to the extent that the

retail stores were to come in a little

bit softer in 2025 uh softer than your

expectations do you still have room for

optimizing GNA or do you think that uh

you know the the guidance that you gave

today already includes all the

opportunity that you have over there

thank

you yeah danil thank you for the

question I think it's it's a really good

one in terms of uh how we're thinking

about the business and how we pivoted if

you go back to the prepared remarks we

said that 2024 was a year where sales

didn't really track to what we initially

expected at the beginning of the year

and despite that we found agility in the

p&l to actually drive the 8% operating

income growth that we' uh that we were

targeting and a couple of things that

actually helped us in 2024 procurement

productivity fantastic from the supply

chain organization they've done a really

terrific job and that's a fly wheel that

continues to run we expect more of that

in 2025 as we look forward to that and

then I think in terms of timing of

Investments I talked about this even

earlier during the third quarter call I

think where we had three different

buckets of Investments specifically in

GNA we had consumer technology store

technology and and capacity Investments

I think on the capacity Investments

piece we we I think based on the way the

volumes were going we're able to retime

that a little bit and actually that's

part of what's in the numbers um when we

look at how 25 is built up we we

actually do have that framework as we're

looking at it but we want to make sure

that we're pacing our investments

appropriately with where sales are going

we've demonstrated through 2024 that

we're able to Pivot if there is a shift

a little bit in terms of what the sales

momentum is and we have a lot of

confidence in doing that in 25 as

well thank you and our next question

comes from the line Peter Sal from bti

your question

please great uh thanks for taking the

question uh I wanted to ask about the

third party I mean you exited 2024 near

the 3% Target on on Uber Eats uh are you

still on track for the billion dollars

of incremental Revenue by the end of

2026 um and what if anything have you

learned from The Uber Eats partnership

over the past call it year uh five six

quarters now that maybe informs how

you'll do things differently when you

expand to another third party

partnership uh in 2025

thanks yeah thanks Peter um yeah we're

we're still uh bullish on on this being

a billion dollar opportunity for us the

timing may have uh uh is is going to be

pushed out a little bit and that's

really because we have purposely managed

this for you know um as as high of an

incremental uh volume a as we can and so

you know once we get on some of the

other um uh you know platforms obviously

you know we we continue to to grow there

I think what we've learned with with

Uber um is a couple things one is how to

optimize the marketing so one of the

reasons I I've talked about kind of the

billion maybe taking a little bit longer

to get to is you know we've learned how

to optimize incrementality and so we're

not going after all the volume right

away we want this to grow over time and

be you know incremental um and accretive

to the profitability of our our

franchises so we've learned how to do

marketing better I think on this

platform and then just technology

integration I would expect that if we

were to go on another uh platform that

the tech integration would be quicker

than it was you know when we were doing

it from

scratch thank you and our next question

comes from the line of Andrew Charles

from TD C your question

please great thank you uh I wanted to

ask about the

$162,000 of Us store level cash flow in

2024 it trailed the initial $170,000

Target issued at the December 20123

investor meeting so I'm curious if if

the shortfall was versus versus the

original expectation was that strictly

sales or some other driver there and

then Russell can can you also address to

just franchisees conviction and

prioritizing Renown value to property

properly goow sales just given the

shortfall in 24 of pre he store level

cash

flow so I I'll start on the first part

on the on the St cash flow um Andrew so

look I agree I mean I think when we

started the year we in 2024 we're

expecting

$170,000 of uh St cash flow and we

finished up at 162 and and and candidly

on the first half of the year we were

tracking we were tracking where we were

expecting but but as we kind of moved

into the second half you saw the sales

softness that came in in the third

quarter we talked about it the macro

environment plus the competitive

pressures really started Weighing on on

sales and and then profits as well uh

with with the promotional intensity that

was building and then when you got into

Q4 um it just accelerated and and if we

look at the comp Trends went and the

intensity continued to be

heavy and and and on top of that we had

a 4.4% food basket in the fourth quarter

so that actually didn't help from a cash

flow perspective either so all that is

to explain what happened in terms of the

Cadence of the cash flows however the

important thing and this was really

critical we grew about a point of market

share in the in the year and and that is

critical because you take that market

share growth you take the Loyalty

membership which grew by 2.5 million

members and then you look forward into

20 into 25 with that scale advantage

that we have whether it's in marketing

whether it's in digital whether it's in

the supply chain side we have a lot of

um lot of capitalist to drive continued

growth not only in cash flows but I

think overall in terms of share growth

as we move into 25 yeah Andrew I guess

I'd add to that you know our our our

franchises are pretty special uh you

know they're they're fully invested in

in dominoes they don't rent run any

other you know restaurant chains is this

is this is their business and they are

competitive folks and actually they're

in it for the long term because of you

know this being uh their their their

their primary business and so what they

saw this year was uh I'm sorry this year

meaning in 2024 I apologize 2024 was

similar promotions right with with some

of the uh competition but sales higher

for us stores higher for us share higher

for us and so they know what the looks

like on Lower volumes and if they're in

it for the long term if if you know

you're holding your own on on profit and

you know you're negatively impacting the

competition um that's a good thing and

this is not me just talking about

sentiment I I'd say the franchisees are

are talking with their actions because

one of the things that they um

approved well into the quarter so they

knew where things were going was this

$999 you know any promotion this best

deal ever and so they're going to if had

any qualms about continuing to to lean

in you wouldn't see literally what is

our best deal ever um in market and

similar with store growth the store

growth signs up are there so it was a it

it certainly wasn't a year where we

delivered what we said we would but I

think they're in it for the long term

we're in it for the long term it was

still a win in 2024 for Don's

Pizza thank you our next question comes

from the line of John Tower from City

your question

please hey great thanks for taking the

questions good morning um I was just

curious if you could dig a little bit

into the international unit growth and

and I understand uh the headwinds that

the business will be facing in 25 from

the Australia um Master franchisee

closure but what you know can you speak

to maybe the confidence you have in this

re accelerating in 26 and specifically

do you have any other Global Master

franchises where you see potential for

potential Market consolidation um and

and store closures over the next 12

months or

so yeah let me let me why did I start

and and you continue um look I think you

know the the 200 closures by DPE um by

the end of the year I think we those

closures will will be behind us what

what I want to make sure that I I focus

everyone is our two largest growth

markets uh China and India remain on

track China opened up 240 stores last

year they're talking now 300 to to 3 50

and so the the growth um in the rest of

the system is is really strong and the

DPE closures by the end of the year I

think will uh will be behind us anything

to ask yeah and I think what I will say

is you've probably heard on the prep

marks I talked about the international

store profitability improving uh

slightly despite the pressures that

we're talking about on DPE and paybacks

improving the the paybacks are obviously

very very compelling in China and India

that Russell just talked about but

they're very very good outside of China

and India as well even you look at the

portfolio outside of DPE and even DP I

think we're looking at all the actions

that are being talked about by the DP

organization to prune the portfolio the

200 plus stores that they're going to

close this year the the commentary from

their CEO is to be very focused on

profitable sustainable uh growth from

their portfolio so all of this aers very

well for 2026 and Beyond because I think

we we're looking at very healthy growth

and and in ably store economics are

going to be the leading indicator of

what is going to happen with the unit

growth and we're definitely on the right

path on

this thank you and our next question

comes from the line of Christine Cho

from Goldman Sachs your question please

great thank you for the chance to ask

questions um so I think you mentioned

1,600 do stretchers at the end of third

uh fourth quarter which is up

meaningfully but uh still in roughly a

quarter your stores in the US so I'd

like to understand what are some of the

key Inhibitors on a more accelerated

roll out and any metrics that you can

share on the impact to the overall store

operational efficiency thank

you yeah sure um right now really just

the the uh um the impact on why we don't

have more is we're just we're just

trying to ramp up Supply demand is is

higher than Supply and that means the

thing is working I'm you know metrics

you know the one that I'd like to point

on is um usually if we bring somebody

new on board it takes them about uh 25

shifts in a store to get to um kind of

call it comp speed of Competency to

stretch dough with DJ it's it's two

shifts and I don't even think it's that

long but that's all that su's letting me

say is is is is is is two shift so um

but what I want to do is take a step

back and make sure we you guys

understand the dose stretcher is just

one piece of it you know what we did and

this was really coming out of Co we said

uh we got to get better at what we're

doing have to reinvent our circle of

operations both the a physical plant but

also technology and so you you look at

what we've done which is improved Doos

reinvent our circle of operations two

straight years of programs concentrating

on training our our franchisees we had

summer of service two years ago and then

last year we had um you know most

delicious operations in that training

net net a couple things one is um our

delivery times have improved by a couple

minutes um and secondly in our Team USA

stores uh turnover turnovers lower so if

you've got a new circle of operations

that makes it better for your team

members and you're delivering better to

your customers I think that's a win-win

so I know the question was about DJ but

I just want to take a step back and say

DJ is part of an overall approach we've

had over the last three years to improve

operations

thank you and our next question comes

from the line of Chris o call from steel

your question

please yeah thanks for taking the

question um Russell you mentioned the

roll out of a new e-commerce platform

this year including new app and site can

can you just provide some more

information of what those changes will

entail both from a consumer facing side

and then also kind of a backend for the

business side and then are you are you

expecting a meaningful Improvement let's

say in conversion rates following these

changes yeah Chris so let me let me talk

to you about how we're doing the roll

out first is the the site's built we

finished building it last year and you

talk about conversion that's kind of

what we're doing now and so we're slowly

um showing more and more people the site

letting the mortar on the site and uh

then what we do is when when there are

pieces of conversion that are flat to

positive we'll roll that if things we

need to change you know we'll we'll

we'll go back and and fix that this is

obviously it's a it's a huge website and

so you know a tenth of a percent of uh

conversion loss is is is an issue and so

what we see in 2025 is this is going to

be a year where we're rolling this out

at at a at a fast a pace as we can to

make sure we're continuing to support

the business you know in in in the in

the right way um probably the uh apps

will be a little bit later than the

website but all should be out this year

um if I were to highlight a couple of

things on on the on on what consumers

will see um it is it takes most

delicious food up um a level big time I

mean we've already fast forwarded some

of the um new food photography onto the

old website but just the layouts and all

that are you know um you know people buy

with their eyes first and so I'm excited

about that a lot of the user flows are

just we've taken steps out of the the

user flow and things are much more

intuitive you know the app was it uh we

brought up a long time ago a lot of

things have changed a lot of things that

were frankly common among other apps we

didn't have um also our carry out

business is much bigger than it it was

when we developed the the uh the

original website and so that which was

kind of an Al uh afterthought uh in our

in our first website won't be there in

in this this will be a great care and

experience and then on the back end you

know when you talk about integration

into our systems when you talk about

personalizations when you talk about

speed all of that is uh is is is the

reason we're confident uh about the the

new

website thank you and our next question

comes from the line Brian Harper from

Morgan Stanley your question

please yeah thanks good morning guys um

sometimes you've talked about kind of

carry out versus delivery share was the

the point gain consistent across both of

those in um you know in 2024 and I guess

just as was sort of implied earlier

right excluding kind of the Uber

contribution I mean underlying delivery

is obviously still kind of the softer

spot is is your expectation that that

doesn't change too much into into this

year or you know is there some some

pickup there and and where do you think

kind of that business is is going

to yeah so uh Brian first the we the

market share games were both in in carry

out and delivery um and and you know we

we continue to think we're going to have

balanced growth moving forward you're

right about one p being a little bit

where the the softness was um you know

there it's uh people uh switching to

eating at home um and so you know 3p for

us is is new once we once we get into

that obviously all those consumers in

those marketplaces are new but you know

delivery is is a tougher value right now

in this value conscious world and so you

know the the choice though isn't going

to you know another restaurant most of

the time it's it's it's it's eating at

home and and Brian I think you you

didn't specifically ask this but I think

you brought up something which I think

is super important as we think about 25

we expect balanced growth between

delivery and carry out we expect

balanced growth between ticket and

transaction as well and I think that's

that's super important to actually think

about as you're putting together your

your models and we we will continue to

stay very disciplined on pricing we you

saw in spite of actually taking the high

single digit pricing in California we

really were in the low single digits in

in 24 and pricing expect much the same

in terms of pricing disciplines in 25 so

we continue to build on our advantage on

renowned value and and drive for more

market share yeah Brian yeah one one of

the things I I I should have said as

well is you know looking forward

especially when we're on all the

delivery platforms our delivery business

is going to be that's how we're going to

report on delivery business our delivery

business is going to be one p you know

and and and and 3p and if you remember

the way we priced and the way we're

managing um franchisee profitability on

some of these new channels um we want to

meet consumers where they are and if

this is where they want to be um it's

going to be a profitable transaction for

customers so I understand the questions

on onep I really would though especially

as in the back half of the year start

thinking about our delivery business as

as as one business that's how we're

approaching

it thank you and our next question comes

from the line Lauren Silberman from

Deutsche Bank your question

please thanks for the question so it's

been reported that you plan to launch

stuff cross soon I think most investors

expect it in the next month or so I

guess how are you thinking about

balancing the timing of a high volume

lto with potential additional delivery

partners and on that point it sounds

like you may not willing to be you know

confirming a specific lto but can you

help us understand you know whether this

is already contemplated in the 3% guide

and what you're expecting in the first

half being a little softer thank

you yeah sure um few questions there I

think you know in general your first

question um or your first sentence you

talked about lto um I'm not saying we'll

never do lto but you know we do a lot of

work I talked about Innovation with

intent in my opening remarks you know

our desire when we launch something is

is to get the longterm Roi you need to

keep the thing longterm so if you look

at what we did last year with New York

style pizza on the pizza end we brought

in a crust type that we didn't have and

then um with mac and cheese we brought

news to pasta that we launched in 2009

and by the way that news helped us keep

pasta volume while we took a couple of

skus out of that clean up that business

you know a little bit um you're not the

first person Believe It or Not Who asked

about stuff crust um and I look I'm not

I'm not surprised we're the number one

pizza company in the world and it's one

of the biggest crust types out there and

we don't have it we don't have it in the

states we do have it in other markets uh

so we're not going to comment on future

products but I think maybe the way to

answer is to is your last question which

is to say hey look guys you're you're

you're trying to build volume here

whether it's with new products or going

on more aggregators what's What's Your

Capacity to deal with that and I I guess

I'd say a couple things one is um if you

think about the number of orders we were

putting through during covid uh we are

we are still not at that level number

two is if you think about our operations

since then it's at a much better level

level I I won't go through it again but

we've you know changed our circle of

operations Doos all of that stuff so

there's still volume upside in a more

efficient Domino's than we've ever had

since I've been here and Lauren I'll

just add to what Russell said because

you asked specifically what's in the

same sales guide so a couple of things I

think on on aggregators it was pretty

clear in the prepared remarks that we're

expecting a more meaningful impact in

the back half so yes that is included in

the 3% same store sales guide and and I

think apart from that we have a a a

slate of initiatives that we're not

going to talk about for competitive

reasons but they're all in the same

store sales guide because we know what

those are and that's part of our

expectations yeah including two new

products obviously we we say we're going

to do two new products every year and so

there will be two new products uh this

year

um

yeah thank you and our next question

comes from the line of Jeffrey Bernstein

from barklay your question

please great thank you very much wanted

to talk about Domino's positioning uh

within that renew renowned value uh in

the US that you speak about um clearly

it looks like you're assuming comps re

accelerate to reach the 3% and 25 versus

the looks like 40 basis points in the

most recent quarter and there's already

lots of focus on value in the pizza

androo qsr segments so I'm just

wondering when you think about two

things one the delivery side of your

business I would think is less about

value with the search charges and tips

and at the same time your qsr

competition is aggressively pushing $5

meals uh I would think both those things

maybe eat into your value leadership so

just hoping you could talk about the the

delivery segments resilience in a

challenge macro and your thoughts on the

broader non-pizza qsrs pushing a whole

lot more value than they were doing 12

24 months ago thank

you yeah Jeff you know the um the way I

think about value it's relative value

and so relative to ourselves in carry

out delivery is is certainly more

expensive you got the fees um you know

hopefully tips for our for our our

drivers um but still when you look at um

delivery to delivery um it it it we're

we're very competitive down to uh the

delivery fee and the price not only to

other pizza but really other items you

get delivered if you think about getting

a pizza delivered to your house two

pizzas delivered to your house you know

for for $6.99 each that's 16 slices

you're feeding a lot of people um and so

when we talk about value in delivery um

being a little pressured especially with

the lower income customer it's more Val

it's more value compared to our carry

out than it is to other delivery choices

thank you and our final question for

today comes from the line of Jeffrey

farmer from Gordon H your question

please um thank you you just touched on

a little bit of it but with some of the

restaurant earnings calls over the last

two weeks uh your peers have clearly

suggested that the demand headwinds that

had largely been isolated to the lower

income cohort for most of

2024 are are beginning to sort of expand

be Beyond just lower income so how do

you see that as you move through 2025 in

terms of of demand headwinds that might

be expanding beyond the lower income

cohort yeah I think for us a couple

things I'll talk about dominoes but then

I'll talk about larger restaurant I mean

the the we're seeing the cross income

cohort be really more of a pressure on

one p yeah within you know within Pizza

one p delivery but I think of I was just

talking about oh overall qsr business

and what seems to be happening is

there's a new Dynamic I you've always

heard me talk about kind of down

switching so in a tougher climate uh

economically you're going to see

customers uh maybe go down from um more

expensive dining options into qsr or

pizza that's continuing to happen and

you've always heard me talk about out

switching right which is at some point

especially with delivery when when um

consumers pressures are are as such that

you know maybe they they want more

affordable options that lead at home

what what we're starting to see now and

this maybe a little bit less so in in

Pizza than in other part other parts of

qsr it's what I'll call up switching

where the the price gap between you know

let's say a burger at qsr versus you

know casual dine or fast casual the

price Gap those those other areas may be

more expensive than qsr but the Gap

maybe isn't as big as it used to be and

so customer may be saying hey you know

what I'm willing to pay a little bit

more because the occasion is going to be

different or maybe the food's going to

be a little bit different and so there

are lots of dynamics that we're

following now with customers the down

switching the out switching the up

switching um clearly though they're

looking for Value but maybe I'll maybe

this is a good way to end the call I

think one of the things that uh I keep

reiterating with the team is this

thought that value is not value if a

customer doesn't value it what do I mean

by that a as as folks are uh driving

more value into the

marketplace just because there's price

off a certain item if customers don't

want that item then it's really not

value and one of the strength I think we

have at Domino's Pizza is that when you

think about our pizza and every single

uh platform we have all of those you can

get as part of our mix and match and I

think that's something that's unique to

us it's something we've had for you know

14 15 years and in the long term if a

customer is having to buy something they

don't want to buy for the right price

it's going to start to affect their

frequency um at a restaurant so that's

why I think long term I really like what

our what our strategies brought

forth thank you Jeff that was our last

question of the call I want to thank you

all for joining our call today and we

look look forward to speaking with you

all again soon you may now

disconnect thank you ladies and

gentlemen for your participation in

today's conference this does conclude

the program you may now disconnect good

day