Domino's Pizza's third-quarter earnings exceeded Wall Street estimates, while revenue did not meet market expectations, as the pizza restaurant chain revised its growth outlook for annual global retail sales and operating income for the fiscal year 2024. The company's net income rose slightly to $4.19 per share for the three months ending September 8, compared to $4.18 in the previous year, surpassing the Capital IQ-polled consensus of $3.64.
Revenue showed a 5.1% year-over-year improvement, reaching $1.08 billion, but fell short of the Street's anticipated figure of approximately $1.1 billion. Contributing to the topline results, higher revenue from franchise royalties and advertising efforts in the U.S., along with an enhanced supply chain strategy, played a crucial role.
The revenue growth from the supply chain was attributed to increased order volumes and a 1.3% rise in the company's food basket pricing to stores, according to Domino's. In the U.S., same-store sales improved by 3%, driven by transaction growth from the company's rewards program and various marketing initiatives, noted Chief Financial Officer Sandeep Reddy during an earnings call.
International same-store sales, adjusted for foreign exchange impacts, saw a modest 0.8% increase, a decline from the 3.3% rise in the same quarter last year. "We did begin to see macroeconomic and competitive pressures influence our results in August, particularly impacting our low-income customers," Reddy stated, highlighting difficulties in their Asia, Europe, and Middle East markets. During the quarter, the pizza chain operator experienced a net global growth of 72 stores, comprising 24 openings in the U.S.
and 48 internationally. Global retail sales rose by 5.1%, excluding foreign currency effects. Looking ahead, the company projects annual global retail sales growth of about 6% and an approximate 8% increase in annual operating income for the fiscal year 2024. This forecast comes in light of a "challenging macroeconomic environment" that is anticipated to influence global business trends.
This marks a revision from the long-term guidance initially provided in December, which projected over 7% growth in annual global retail sales and above 8% growth in annual operating income from 2024 through 2028. Domino's expects that the growth in annual global retail sales and operating income for fiscal 2025 will align closely with its projections for 2024.
Reddy mentioned, "As we approach 2025, we expect to be slightly below our long-term guidance algorithm, primarily due to our international business." For the period from 2026 through 2028, the company has maintained its growth outlook. Current Stock Price: 410.41, Change: -2.80, Percent Change: -0.68.