Domino's Pizza (NASDAQ: DPZ) held its fourth-quarter 2024earnings callon February 24, 2025, revealing progress in its "Hungry for MORE" strategy implementation and market share gains despite a challenging consumer environment. The call highlighted management's focus on value leadership, operational excellence, and strategic expansion of delivery channels.
Market Share Gains Validate Value-Focused Strategy
In a pressured consumer spending environment, Domino's strategic emphasis on value is delivering results. The company gained approximately 1 percentage point of quick-service restaurant (QSR) pizza market share in 2024, continuing its long-term pattern of market expansion.
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We grew retail sales in the U.S. by 5.3% in 2024. Importantly, as something that continues to be unique in the industry, we drove meaningful positive order count growth.
-- Russell Weiner, CEO & Director
This growth comes despite significant competitive pressure, demonstrating Domino's ability to maintain pricing discipline while driving traffic through value initiatives.
Digital and Loyalty Program Show Strong Momentum
The company's rewards program is showing strong adoption and helping drive repeat business, particularly among key target segments. The program grew significantly in 2024, positioning Domino's for continued customer engagement and personalized marketing opportunities.
We grew our overall active members significantly in 2024, finishing the year at 35.7 million users, up approximately 2.5 million versus 2023. ... This strong base of users will allow us to engage more customers and drive frequency with targeted and personalized marketing efforts.
-- Russell Weiner, CEO & Director
This digital foundation, combined with an upcoming e-commerce platform refresh in 2025, strengthens Domino's ability to drive sustained growth through enhanced customer engagement.
Aggregator Strategy Showing Early Success
Domino's partnership with Uber has validated the company's strategic entry into third-party delivery, with management expressing confidence in the long-term opportunity while maintaining disciplined execution.
We successfully entered the aggregator space with our partnership with Uber, achieving our goal of exiting the year at 3% of sales coming through this channel. ... We believe that this channel represents an incremental sales opportunity of $1 billion over time.
-- Russell Weiner, CEO & Director
The company plans to expand its aggregator presence in 2025, with negotiations underway for additional partnerships and a meaningful impact expected in the second half of the year.
Operational Excellence Driving Efficiency
Domino's continues to invest in operational improvements that enhance both customer experience and store economics. The company has successfully reduced delivery times while implementing new technologies to improve store operations.
Our average delivery times decreased by 2 minutes over the last 2 years. ... We've now rolled out 1,600 DJ dough stretching machines across the U.S., more than a 50% increase from where we were at the end of Q3.
-- Russell Weiner, CEO & Director
These operational improvements are particularly significant as they support both current performance and future growth capacity, with the CEO noting that current order volumes remain below peak COVID-19 levels despite enhanced operational capabilities.
International Business Shows Signs of Recovery
While facing macroeconomic headwinds, Domino's international business demonstrated improvement in the fourth quarter, maintaining its impressive 31-year streak of same-store sales growth and showing success with market-specific value initiatives.
Domino's International showed strong improvement in the fourth quarter. ... Canada ran an Emergency Pizza promotion in Q4, and that's been a strong traffic driver for them. In India, Jubilant has driven sales through increased delivery orders after eliminating their delivery fee.
-- Russell Weiner, CEO & Director
Looking Ahead
Management projects global retail sales growth in 2025 to be generally in line with 2024 levels, targeting U.S. same-store sales growth of 3% driven by traffic-building initiatives in aggregators and loyalty programs. The company expects to add 175-plus net new stores in the U.S. and plans to maintain low single-digit pricing discipline despite inflationary pressures. International same-store sales are projected at 1% to 2% growth before returning to more normalized levels in 2026.
The company's strategic priorities for 2025 include expanding aggregator partnerships with meaningful impact expected in the second half, rolling out a new e-commerce platform, launching at least two new products, and maintaining its value-driven approach in what management anticipates will be another challenging year for the industry.
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David Kretzmann has positions in Domino's Pizza. The Motley Fool has positions in and recommends Domino's Pizza and Uber Technologies. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
