Domino’s revenue growth
In the first three quarters of 2018, Domino’s Pizza (DPZ) posted revenues of $2.35 billion—24.0% growth from $1.90 billion in the same three quarters in 2017. The revenue growth was driven by adopting a new accounting standard, which contributed $245.6 million. The revenue growth was also driven by higher supply chain revenues and increased revenues from Domino’s Pizza’s company-owned restaurants and franchised restaurants.
Domestic company-owned restaurants
In the first three quarters of 2018, domestic company-owned restaurants segment posted revenues of $358.5 million, which represents 5.8% growth from $338.9 million in the same three quarters in 2017. The revenue growth was driven by positive SSSG (same-store sales growth) of 5.4%. However, the decline in the unit count of company-owned restaurants by six units to 386 restaurants since the beginning of 2018 offset some of the growth in the segment’s revenues.
During the same period, the segment’s revenues increased 12.3% to $1.33 billion. The revenue growth was driven by volume growth due to positive SSSG and the net addition of new restaurants. However, unfavorable currency offset some of the segment’s revenue growth.
Domestic franchised restaurants
The domestic franchised restaurants segment posted revenues of $266.3 million in the first three quarters of 2018, which represents 9.8% growth from $242.5 million in the same three quarters in 2017. The company’s franchised restaurants increased by 170 units in the first three quarters of 2018. More franchised restaurants and the positive SSSG of 7.3% increased the segment’s revenues.
International franchised restaurants
During the same period, the international franchised restaurants segment’s revenues rose 14.9% to $154.2 million. The revenue growth was driven by the net addition of 334 net new restaurants since the beginning of 2018 and positive SSSG of 4.0%.
Analysts’ revenue expectations
Analysts expect Domino’s Pizza to post revenues of $1.10 billion in the fourth quarter to take the total revenues for 2018 to $3.45 billion, which represents 23.7% growth from 2.79 billion in 2017. Analysts expect the company’s revenues to increase 9.8% to $3.79 billion in 2019.
Next, we’ll discuss analysts’ EPS expectations.