By Ananya Mariam Rajesh
(Reuters) -Domino’s Pizza Inc beat Wall Street estimates for first-quarter U.S. same-store sales and profit on Thursday, boosted by higher prices as well as new promotional offers and menu items that helped draw more customers to its outlets.
The pizza chain’s better-than-expected sales follows similar reports from McDonald’s Corp and Chipotle Mexican Grill Inc, which have been bumping up menu prices to protect their margins from a jump in costs of raw materials and labor.
In a bid to attract inflation-weary consumers, the pizza chain relaunched the $3 Carryout Tips promo, where customers who place a carry-out order of $5 or more earn a $3 promo that can be used for another carry-out order.
Analysts have said the company’s new menu item “Loaded Tots” that serves oven-baked potato tots with cheese and toppings in three varieties has helped boost sales during the January-March period.
Shares of the company rose about 2% in early trade.
Consumer spending patterns will normalize with pizza delivery orders beginning to contribute to overall sales growth, according to Siye Desta, analyst at CFRA Research.
The world’s largest pizza chain’s U.S. same-store sales rose 3.6% in the first quarter, compared with analysts’ estimate of a 1.96% increase, according to Refinitiv data.
However, total revenue rose 1.3% to $1.02 billion but missed analysts’ estimate of $1.04 billion hurt by a strong dollar.
Major companies such as McDonald’s and Coca-Cola, which have sprawling global operations and convert foreign currencies into dollars, have flagged foreign currency headwinds.
Excluding items, the Michigan-based fast-food chain earned $2.93 per share, beating estimates of $2.73 per share.
(Reporting by Ananya Mariam Rajesh in Bengaluru; Editing by Krishna Chandra Eluri)
