Domino's Sales Barely Grow as Customers Order Fewer Items: What It Says About Household Budgets

The pizza chain's new CEO says consumers "remain under pressure," a warning sign for restaurants and a reminder of how tight many budgets are.

Domino's Pizza reported third-quarter results on Tuesday, Oct. 13, and the message was clear: people are still ordering pizza, but they are spending less on each order. U.S. same-store sales, which compare sales at locations open for at least a year, rose just 0.3%. A year earlier, they had jumped 5.2% thanks to a big promotion. Shares fell about 2.7% in early trading.

The numbers

Domino's revenue rose about 3.4%, or $38.5 million, helped by its supply chain business, which sells ingredients to franchise owners, and by royalties from franchisees. Profit from operations rose 8.3%, and net income climbed 9.2%. Revenue and profit both beat analysts' expectations, according to reports on the results.

The weak spot was sales growth. U.S. same-store sales have now stayed below 1% for three quarters in a row: 0.9% in the first quarter, 0.1% in the second and 0.3% in the third. International same-store sales rose just 0.2%.

The company opened 175 net new stores around the world in the quarter, including 26 in the United States, bringing its U.S. count to 7,257.

Smaller orders, more careful customers

The most telling detail came from Domino's executives. New CEO Joe Jordan, who took over from Russell Weiner, said that "consumers remain under pressure, but they continue to choose Domino's." Chief Financial Officer Sandeep Reddy said a tough economic backdrop led to lower average tickets and fewer items per order. In other words, customers are skipping the extra side, the second pizza or the dessert.

Jordan said he expects that pressure to last through the rest of the year, and Reddy said U.S. same-store sales growth is likely to come in at the low end of the low-single-digit range for the remainder of the year. Domino's did say it is still growing the number of orders and gaining share among quick-service pizza chains, which suggests customers are trading down to value rather than cutting out takeout altogether.

The company has leaned on deals to keep people coming back, including a weeklong 50%-off promotion in late July and a new personal-sized Detroit-style pizza in August.

What this means for your wallet

When a value-focused chain like Domino's says customers are trimming orders, it's a sign that many households feel squeezed, especially with gas prices up sharply and inflation running at 3.7%. If you're feeling that pinch too, you're not alone, and small changes can help.

Takeout and delivery are among the easiest budget categories to trim. Delivery fees, service charges and tips can add a lot to the menu price, so ordering carryout, using the chain's own app deals or setting a monthly takeout limit can save real money. Planning a couple of easy meals at home each week also helps, since grocery prices have been rising much more slowly than restaurant prices lately.

For investors, restaurant stocks can be sensitive to how much spare cash households have. Watching what companies like Domino's say about customer behavior is a useful way to read the economy beyond the headline numbers.

This article is for education only and is not financial advice. Everyone's situation is different.