Nasdaq:DPZ
DOMINOS PIZZA INC
A leading global franchisor of pizza delivery and carryout restaurants with a focus on digital innovation and consistent brand experience.
Key Metrics
Investment Thesis
Bull Case
Investors may view DPZ as an attractive compounder due to its expanding global footprint and the recurring revenue nature of its franchise model which generates high operating leverage. The strong cash conversion ratio, evidenced by over $600M in net profit against nearly $800M in operating cash flow, provides ample capital for share repurchases and dividends to support shareholder returns.
Bear Case
Despite solid top-line growth, the company operates with a substantial debt load of over $5.6B in total liabilities, creating interest rate sensitivity that could impact net income if rates rise further. The negative shareholders equity position of -$3.90B indicates accumulated losses or significant intangible asset write-downs that warrant caution regarding long-term solvency and capital structure stability.
About DOMINOS PIZZA INC
Dominos Pizza Inc. operates as a global leader in the pizza delivery and takeout industry, serving customers across North America and internationally through its extensive franchise network and corporate stores. The company specializes in fresh-baked pizzas and sides delivered directly to consumers via proprietary technology-enabled ordering platforms and third-party aggregators.
Analysis
Management Discussion
The company demonstrated resilient financial performance with revenue growing from $4.48B in 2023 to $4.94B in 2025, driven by store count expansion and digital adoption. Net income increased steadily over the same period, reaching $601.7M in 2025, supported by strong cash flow from operations of $792.1M despite significant capital expenditures of $120.6M.
Industry Overview
The global quick-service restaurant (QSR) industry is characterized by rapid digital transformation, intense competition for delivery market share, and persistent inflationary pressures on food costs. Dominos competes in this mature yet evolving sector where technology adoption and supply chain efficiency are the primary drivers of differentiation and profitability.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $4.48B | $4.71B | $4.94B |
| Cost of Revenue | $2.75B | $2.86B | $2.97B |
| Gross Profit | $1.73B | $1.85B | $1.97B |
| Operating Expenses | $907.9M | $969.5M | $1.02B |
| Operating Income | $819.5M | $879.0M | $954.0M |
| G&A | $434.6M | $459.5M | $464.1M |
| Stock-Based Comp | $37.5M | $43.3M | $44.6M |
| D&A | $80.6M | $87.7M | $88.8M |
| Other OpEx | $473.3M | $510.0M | $555.5M |
| Non-Operating Income | $-167.1M | $-156.8M | $-183.6M |
| Interest Expense | $196.5M | $195.9M | $196.0M |
| Interest Income | $11.7M | $17.0M | $14.9M |
| Pre-Tax Income | $652.4M | $722.2M | $770.3M |
| Income Tax | $133.3M | $138.0M | $168.6M |
| Continuing Ops | $519.1M | $584.2M | $601.7M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $519.1M | $584.2M | $601.7M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $519.1M | $584.2M | $601.7M |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $817.3M | $905.3M | $894.2M |
| Cash & Equivalents | $114.1M | $186.1M | $125.7M |
| Accounts Receivable | $282.8M | $309.1M | $316.0M |
| Inventory | $83.0M | $70.9M | $79.2M |
| Prepaid Expenses | $30.2M | $40.4M | $39.8M |
| Other Current Assets | $307.2M | $298.8M | $333.6M |
| Long-Term Assets | $857.6M | $831.7M | $822.3M |
| PP&E (Net) | $304.4M | $301.2M | $324.0M |
| Goodwill | $11.7M | $11.6M | $10.7M |
| Operating Leases | $207.3M | $210.3M | $219.5M |
| LT Securities | $16.7M | $20.6M | $25.0M |
| Other LT Assets | $317.5M | $288.0M | $243.1M |
| Total Assets | $1.67B | $1.74B | $1.72B |
| Current Liabilities | $547.4M | $1.61B | $541.6M |
| Accounts Payable | $106.3M | $85.9M | $135.0M |
| Current Debt | — | — | $100.0K |
| Current Leases | $39.3M | $39.9M | $47.6M |
| Deferred Revenue | $5.3M | $5.1M | $4.8M |
| Other Current Liab | $396.5M | $1.48B | $354.1M |
| Long-Term Liabilities | $5.20B | $4.09B | $5.08B |
| LT Operating Leases | $179.5M | $182.0M | $183.9M |
| Other LT Liab | $5.00B | $3.89B | $4.88B |
| Total Liabilities | $5.75B | $5.70B | $5.62B |
| Shareholders' Equity | $-4.07B | $-3.96B | $-3.90B |
| Retained Earnings | $-4.07B | $-3.96B | $-3.90B |
| AOCI | $-3.9M | $-7.4M | $-4.8M |
| Total L&E | $1.67B | $1.74B | $1.72B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $519.1M | $584.2M | $601.7M |
| Non-Cash Adjustments | $-19.0M | $29.1M | $130.0M |
| Working Capital Changes | $90.7M | $11.6M | $60.3M |
| Cash from Operations | $590.9M | $624.9M | $792.1M |
| Capital Expenditures | $105.4M | $112.9M | $120.6M |
| Cash from Investing | $-106.9M | $-31.2M | $-70.2M |
| Debt Issuances | $14.9M | $0 | $1.00B |
| Share Buybacks | $269.0M | $329.6M | $357.7M |
| Dividends Paid | $169.8M | $209.9M | $236.9M |
| Cash from Financing | $-476.4M | $-532.2M | $-752.1M |
| FX Effect | $340.0K | $-2.2M | $1.8M |
| Net Change in Cash | $7.9M | $59.3M | $-28.4M |
| Beginning Cash | $395.2M | $403.1M | $462.4M |
| Ending Cash | $403.1M | $462.4M | $434.0M |
Frequently Asked Questions
How does DOMINOS PIZZA INC make money?
Company revenue is primarily driven by its Core Restaurant segment, which includes both corporate-owned and franchise locations generating sales from food and beverage operations. A secondary stream comes from Direct Delivery and Dine-In segments, while the company also leverages its proprietary technology platform to enable online ordering and digital marketing services for partners.
What are the main risks for DPZ?
The company faces significant exposure to rising commodity costs for ingredients like flour and dairy which can compress gross margins given the high cost of revenue relative to total sales. Operational risks include potential franchisee performance variability and increasing competition from QSR peers and third-party delivery apps that capture a growing share of consumer spending.
What is DPZ's competitive advantage?
Dominos maintains a robust competitive moat through its proprietary AI-driven delivery optimization network that ensures speed and accuracy, complemented by a highly scalable franchise model that limits capital expenditure risk. The brand enjoys strong customer loyalty driven by consistent product quality and its 'Hotter, Faster' value proposition in the fast-casual dining space.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.