Global retail sales growth (excluding foreign currency impact) of 7.2% U.S. same store sales growth of 4.8% International same store sales growth (excluding foreign currency impact) of 2.1% Global net store growth of 175 Income from operations increased 0.4%; excluding the negative impact of foreign currency exchange rates on international franchise royalty revenues of $2.7 million, income from operations increased 1.7% ANN ARBOR, Mich., July 18, 2024 /PRNewswire/ -- Domino's Pizza, Inc. (NYSE:DPZ), the largest pizza company in the world, announced results for the second quarter of 2024. "Our year-to-date performance demonstrates that our Hungry for MORE strategy is off to a great start, having an immediate impact on sales and profits," said Russell Weiner, Domino's Chief Executive Officer. "For the second straight quarter we drove U.S. comp performance in the healthiest way possible, through profitable order count growth. We had positive order counts in our delivery and carryout businesses, and across all income cohorts. Our strategy is resonating with customers and our system, which gives me great confidence that we can drive significant long-term value creation for our shareholders." Second Quarter 2024 Operational and Financial Highlights (Unaudited): The tables below outline certain statistical measures utilized by the Company to analyze its performance, as well as key financial results. This historical data is not necessarily indicative of results to be expected for any future period. Refer to Comments on Regulation G below for additional details, including definitions of these statistical measures and certain reconciliations. Second Quarter Two Fiscal Quarters 2024 2023 2024 2023 Global retail sales: (in millions of U.S. dollars) U.S. stores $ 2,222.1 $ 2,081.2 $ 4,434.0 $ 4,132.2 International stores 2,206.1 2,128.7 4,358.2 4,191.3 Total $ 4,428.2 $ 4,209.9 $ 8,792.2 $ 8,323.5   Second Quarter Two Fiscal Quarters 2024 2023 2024 2023 Global retail sales growth: (versus prior year period,    excluding foreign currency impact) U.S. stores + 6.8 % + 1.7 % + 7.3 % + 3.4 % International stores (1) + 7.7 % + 10.1 % + 7.2 % + 8.3 % Total (2) + 7.2 % + 5.8 % + 7.3 % + 5.8 % Same store sales growth: (versus prior year period) U.S. Company-owned stores + 4.5 % + 5.5 % + 6.5 % + 6.4 % U.S. franchise stores + 4.8 % (0.1) % + 5.2 % + 1.6 % U.S. stores + 4.8 % + 0.1 % + 5.2 % + 1.8 % International stores (excluding foreign currency impact) + 2.1 % + 3.6 % + 1.5 % + 2.3 % (1) 2024 second quarter and two fiscal quarters figures each exclude the impact of the Russia market. Including the impact of the Russia market, international stores retail sales growth, excluding foreign currency impact, was 7.2% and 6.7% for the second quarter and two fiscal quarters of 2024, respectively. (2) 2024 second quarter and two fiscal quarters figures each exclude the impact of the Russia market. Including the impact of the Russia market, total global retail sales growth, excluding foreign currency impact, was 7.0% for each of the second quarter and two fiscal quarters of 2024.   U.S. Company-owned Stores U.S. FranchiseStores TotalU.S. Stores InternationalStores Total Second quarter of 2024 store counts: Store count at March 24, 2024 289 6,585 6,874 13,881 20,755 Openings 1 32 33 195 228 Closings — (1) (1) (52) (53) Transfers (1) 1 — — — Store count at June 16, 2024 289 6,617 6,906 14,024 20,930 Second quarter 2024 net store growth 1 31 32 143 175 Trailing four quarters net store growth 5 166 171 554 725 Trailing four quarters net store growth, excluding Russia (1) 5 166 171 697 868 (1) As previously announced, the remaining 143 net stores in Russia were reflected as closed in the third quarter of 2023 and are reflected as closures in the trailing four quarters ended June 16, 2024. Refer to Comments on Regulation G and Russia Market discussion below for additional details.   Second Quarter Two Fiscal Quarters (In millions, except percentages, percentage points, per share data and leverage ratio) 2024 2023 Increase/(Decrease) 2024 2023 Increase/(Decrease) Total revenues $1,097.7 $1,024.6 + 7.1 % $2,182.4 $2,049.0 + 6.5 % U.S. Company-owned store gross margin 17.6 % 18.6 % (1.0) pp 17.5 % 17.7 % (0.2) pp Supply chain gross margin 11.3 % 10.9 % + 0.4 pp 11.2 % 9.9 % + 1.3 pp Income from operations $196.1 $195.4 + 0.4 % $406.5 $372.9 + 9.0 % Net income $142.0 $109.4 + 29.8 % $267.8 $214.2 + 25.1 % Diluted earnings per share $4.03 $3.08 + 30.8 % $7.61 $6.02 + 26.4 % Leverage ratio 5.0x 5.6x (0.6)x Net cash provided by operating activities $274.2 $242.3 + 13.2 % Capital expenditures (43.7) (38.0) + 15.0 % Free cash flow $230.5 $204.3 + 12.8 %   Revenues increased $73.1 million, or 7.1%, in the second quarter of 2024 as compared to the second quarter of 2023, primarily due to higher supply chain, U.S. franchise advertising and U.S. franchise royalties and fees revenues. The increase in supply chain revenues was primarily attributable to higher order volumes, as well as an increase in the Company's food basket pricing to stores, but was partially offset by a shift in the relative mix of the products sold by the Company. The Company's food basket pricing to stores increased 0.7% during the second quarter of 2024 as compared to the second quarter of 2023. U.S. franchise advertising revenues increased as a result of higher same store sales, the return to the standard 6.0% advertising contribution rate at the beginning of the second quarter of 2024 following the end of the temporary reduction to 5.75% which began in the second quarter of 2023, and net store growth. U.S. franchise royalties and fees increased as a result of higher same store sales and net store growth. U.S. Company-owned store gross margin decreased 1.0 percentage point in the second quarter of 2024 as compared to the second quarter of 2023. This decrease was primarily driven by higher insurance costs and increased labor costs as a result of higher wage rates. This decrease was partially offset by sales leverage due to higher customer transaction counts. Supply chain gross margin increased 0.4 percentage points in the second quarter of 2024 as compared to the second quarter of 2023, primarily due to procurement productivity, partially offset by investments in supply chain labor. Income from operations increased $0.7 million, or 0.4%, in the second quarter of 2024 as compared to the second quarter of 2023. Excluding the negative impact of foreign currency exchange rates on international franchise royalty revenues of $2.7 million, income from operations increased $3.4 million, or 1.7%, in the second quarter of 2024 as compared to the second quarter of 2023. These increases were primarily a result of higher U.S. franchise royalties and fees, as well as gross margin dollar growth within supply chain, each as discussed above. These increases were partially offset by higher general and administrative expenses of $18.2 million, primarily driven by higher labor costs as well as expenses for the Company's Worldwide Rally that takes place every two years. Net income increased $32.6 million, or 29.8%, in the second quarter of 2024 as compared to the second quarter of 2023, primarily due to a change of $26.4 million in the pre-tax unrealized gains and losses associated with the remeasurement of the Company's investment in DPC Dash Ltd ("DPC Dash"). Additionally, the Company's provision for income taxes decreased $3.6 million in the second quarter of 2024 due to a lower effective tax rate, partially offset by higher income before provision for income taxes. The effective tax rate decreased to 15.0% in the second quarter of 2024 as compared to 20.8% in the second quarter of 2023, driven by a 7.0 percentage point change in the impact of excess tax benefits from equity-based compensation, which is recorded as a reduction to the provision for income taxes. Diluted EPS was $4.03 in the second quarter of 2024 as compared to $3.08 in the second quarter of 2023, representing a $0.95, or 30.8%, increase. The increase in diluted EPS was driven by higher net income as discussed above. Net cash provided by operating activities was $274.2 million in the two fiscal quarters of 2024 as compared to $242.3 million in the two fiscal quarters of 2023. The Company spent $43.7 million on capital expenditures in the two fiscal quarters of 2024, as compared to $38.0 million in the two fiscal quarters of 2023, resulting in free cash flow of $230.5 million in the two fiscal quarters of 2024 as compared to $204.3 million in the two fiscal quarters of 2023. The increase in free cash flow was a result of higher net income, excluding non-cash operating activities, partially offset by the negative impact of changes in operating assets and liabilities, higher investments in capital expenditures and payments for advertising activities outpacing receipts from advertising contributions. Quarterly Dividend Subsequent to the end of the second quarter of 2024, on July 16, 2024, the Company's Board of Directors declared a $1.51 per share quarterly dividend on its outstanding common stock for shareholders of record as of September 13, 2024, to be paid on September 30, 2024. Share Repurchases During the two fiscal quarters of 2024, the Company repurchased and retired 56,372 shares of common stock for a total of $25.0 million. As of June 16, 2024, the Company had a total remaining authorized amount for share repurchases of $1.12 billion. Long-Term Guidance (2024 - 2028) The Company continues to expect the following guidance metrics. Annual global retail sales growth and annual income from operations growth exclude the impact of foreign currency. 7%+ Annual global retail sales growth; and 8%+ Annual income from operations growth. The Company now expects the following on annual global net store growth: Global net store growth of 825 to 925 in 2024. U.S.: The Company continues to expect 175+ net stores annually for 2024 to 2028. International: The Company expects it will fall 175 to 275 stores below its 2024 goal of 925+ net stores in international primarily as a result of challenges in both openings and closures being faced by Domino's Pizza Enterprises ("DPE"), one of its master franchisees. The Company is partnering closely with DPE as they work through this process and will provide further updates once it has more visibility into the effect on its annual global net store growth numbers. The Company is temporarily suspending its guidance metric of 1,100+ global net stores until the full effect of DPE's store opens and closures ...