Domino’s Pizza is seeing a slowdown tied to changes in consumer behavior that are pressuring sales. Despite launching generous deals to attract customers, the pizza chain recently posted weak sales growth, and its CEO is pointing to the drivers of the shift.
In the first few months of this year, Domino’s only saw its same-store sales increase by 0.9% year over year, according to its first-quarter earnings report for 2026. Its net income also decreased by 6.6%, compared to the same quarter the year before.
The weak sales come after Domino’s rolled out several deals around major sports events this year to attract customers. Days before the Super Bowl, it launched a deal offering large two-topping carryout pizzas for $6.99 each from Jan. 26 to Feb. 1.
On March 3, just in time for March Madness, Domino’s unveiled its “Best Deal Ever” promotion in March, offering customers any pizza with any toppings for $9.99 each until April 6.
The company even updated its mobile app later that month with a new version of its pizza-tracking tool, allowing customers to track when their order will be ready for pickup or delivery with greater precision.
In a statement to Reuters on April 27, retail analyst Bruce Winder said that Domino’s is struggling to navigate the current economic landscape.
“Domino’s is facing perhaps a tougher U.S. market than anticipated,” said Winder. “Inflation and a softening economy, specifically for lower-income consumers, have put pressure on its top line.”
Domino’s CEO explains why consumer demand is weak
During an earnings call on April 27, Domino’s CEO Russell Weiner said that while he was pleased with the company’s performance during the beginning of the year, for the rest of the first quarter, it “did not meet our expectations.”
“Looking back at Q1 (first quarter of 2026), pressure intensified throughout the quarter, in particular, in March because of growing consumer uncertainty,” said Weiner. “Consumer sentiment hit COVID-level lows, and ongoing inflation continued to impact purchase decisions.”
In March, the University of Michigan Consumer Sentiment Index reached 53.3, shortly after the U.S. and Israel attacked Iran on Feb. 28, according to University of Michigan Survey of Consumers data. As the conflict unfolded, consumer sentiment fell to 49.9 in April, a 6.6% month-over-month decline.
“The Iran conflict appears to influence consumer views primarily through shocks to gasoline and potentially other prices,” said University of Michigan Surveys of Consumers Director Joanne Hsu in a statement.
Amid economic uncertainty, prices for food away from home climbed by 1.9% in March, according to U.S. Bureau of Labor Statistics data.
As fast-food prices rose and consumer sentiment declined, Domino’s foot traffic in stores began to wane in March. According to Placer.ai data sent to TheStreet, foot traffic in Domino Pizza stores (excluding delivery) increased by 4.8% in January, 5.6% in February, and 1.9% in March.
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Weiner said that weather and heightened competition also posed challenges for Domino’s during the first quarter.
“Weather also affected our business in the quarter, including the beginning of our carryout special boost week,” said Weiner. “Competition within the QSR pizza space also increased in Q1 as the national pizza players offer deals comparable, if not identical, to the renowned value Domino’s has made famous.”
While Domino’s saw its carryout comparable sales increase by 2.4% year over year, its delivery sales were down 0.3%. Weiner claimed that despite the decline in delivery orders, it is still maintaining a base of low-income consumers in that category.
“Lower-income consumers, which we have a good amount of those customers, when it comes to delivery, when times are tight, what happens is we don’t lose those customers, we may lose an occasion, those people come back,” said Weiner.
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Weiner also emphasized that Domino’s competitors have been increasingly “leaning in on value” to attract customers via value deals, which has been putting pressure on the company.
However, he doesn’t expect this trend to last and predicts competitors will announce more store closures as they struggle to afford the deals they are offering to customers.
“I know the kind of volumes that need to be done in order to make deals like the ones we have out there profitable,” said Weiner. “And I do not believe that our competition can drive those kinds of volumes because their advertising budget, ours is as big as the biggest 2 competitors combined, just can’t do that.”
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Domino’s outlines a cautious outlook amid sales pressures
Amid recent challenges, Domino’s expects its U.S. comparable sales to increase by low single digits and operating income to grow by mid-to-high single digits in 2026.
“With the macro environment and the pressure on the low-income consumer, there will be broadly industry-wide impact that we would expect,” said Domino’s Chief Financial Officer Sandeep Reddy during the earnings call.
Weiner said that Domino’s will not only focus on value but also double down on pizza innovation to encourage customers to order more. This is a tactic that it leveraged last year when its sales declined.
“We have absolutely looked at our calendar and asked ourselves within what we can control, how do we change things? How do we see what’s out there in the environment? And it’s not just value, I think we can do a little bit more on pizza innovation as well,” he said.
“And so starting as soon as May, you’re going to see things on the calendar or in media from Domino’s that weren’t on our calendar to start the year,” he continued. “So our plans moving forward will look very different than they were starting the year, and that’s because we adapt to what’s going on in the broader environment.”
Domino’s cautious outlook on sales and shift in strategy come as many U.S. consumers are cutting back on restaurant and fast-food spending amid economic pressures, according to a recent LendingTree survey.
How Americans are cutting back to afford food:
- Approximately 52% of Americans said they’re spendingmore on food this year than they were last year.
- Additionally, 49% said it’s at least somewhat difficult to afford food right now.
- Also, 84% of Americans have reduced restaurant spending to save money.
- About 39% are eating out less, and 16% have stopped getting food delivered.
- Americans are also changing where they eat, with 22% selecting cheaper restaurants or fast food, and 13% eating at home before going out for a smaller meal.
Source: LendingTree
“Food costs are hitting every income level, and it’s changing how people spend,” said Matt Schulz, LendingTree’s chief consumer finance analyst, in a statement to Food & Wine on April 9.
“Nearly half of Americans are struggling to afford food, and even higher earners are feeling the pressure. That shows up in everyday choices, from groceries to dining out, and it’s a clear sign that budgets are stretched thin,” he continued.
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