Domino’s Pizza: Plan for Japan but No Quick Fix

The full potential of Domino’s businesses in Japan and France, both large markets in its portfolio of 12 countries, is unlikely to be unlocked in the near term. Management expects it unlikely that the store count in those jurisdictions will grow in fiscal 2025 as franchisee profitability must recover first before store growth can resume. While the firm maintained its long-term target of nearly doubling its global store footprint, timing is subject to a recovery in sales growth. We trim our outlook for near-term profit margins and new stores, with our fiscal 2025 earnings per share estimate declining by 11% to 1.88.