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PZZA · Papa Johns International Inc

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$24.26 -0.17 (-0.70%) At close · Aug 14
Market Cap
$793.08M
Shares
32.92M
All earnings calls

Earnings call · FY2026 Q1

Papa Johns International Inc Q1 FY2026 Earnings Call

Papa Johns International Inc Q1 FY2026 Earnings Call

Concluded May 7, 2026 Audio replay Verified speakers
May 7, 2026 41:12 23 turns
Period
FY2026 Q1
Runtime
41:12
Sources
4 artifacts

Executive readout · one minute

What matters this quarter

Papa John's Q1 2026 results showed continued strength internationally with a 3.6% comparable sales increase, but North America comparable sales fell 6.4% on declining orders and lower new customer acquisition, leading to lower revenue, net income, and EPS; the company reiterated its fiscal 2026 outlook.

Innovation pipeline and new product launches 34 International strength 24 Transformation and long-term strategy 23 North America comparable sales decline 17 Retail and brand partnerships 13 Competitive pressure and consumer headwinds 10

Management tone

Balanced

Net tone +5 · moderate hedging

Grounding quotes
  • “While transformation work is neither linear nor instant, we are confident that the progress we are making in Papa John's transformation, combined with the strength of our brand and quality of our pizza will fuel profitable growth and value creation over the long term”
  • “we are taking a disciplined approach, executing a balanced transformation that extends well beyond price, meeting customers where they are while improving 4-wall margins”
  • “As anticipated, North America comparable sales ended the first quarter down mid-single digits, primarily driven by declining orders, which were pressured by lower new customer acquisition”
  • “We're going to pick our spots where we need to do that. We're going to leverage innovation to balance it. We're going to take a long-term approach to make sure we set our business up for long-term success.”

Forward guidance

4 guided metrics

Management's latest ranges and targets are included below.

Research coverage

4 live sources

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Revenue $478.61M -7.7% YoY
Diluted EPS $0.21 -22.2% YoY
Net income $7.25M -21.3% YoY

Research materials

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Key takeaways

What improved, and what deserves a closer read.

Constructive signals

  • International comparable sales grew 3.6%, marking six consecutive quarters of positive comps
  • U.K. comparable sales accelerated to 11% from 7% in Q4; Middle East up 9%, Asia Pacific up 5%
  • Added nearly 1 million new loyalty members in Q1; frequent/super-frequent tiers now ~30% of customer base
  • Pies per order increased 5% year-over-year; loyalty customers generate 5% higher ticket and order twice as often
  • Launched two new menu platforms in Q1 (Pan Pizza and oven-toasted sandwiches) plus new Cheesy Garlic Bread side
  • Announced global Disney/Pixar Toy Story 5 collaboration and Walmart/Kroger/Safeway retail launch of Papa John's garlic sauce across 7,500 distribution points

Risks & pressure points

  • Global system-wide restaurant sales fell 3% to $1.20 billion; total revenues declined 7.7% to $478.6 million
  • North America comparable sales decreased 6.4% (Domestic Company-owned -5.2%, franchised -6.7%), pressured by declining orders and lower new customer acquisition
  • Net income fell to $7 million from $9 million; diluted EPS dropped to $0.21 from $0.27 and adjusted diluted EPS to $0.32 from $0.36
  • Pizza sales showed low single-digit declines (ex-weather) as mix shifted to smaller nonspecialty pizzas; non-pizza comparable sales pressured by declines in sides and desserts
  • Highly promotional QSR marketplace and competitor price aggression compressing margins; company taking a disciplined, long-term approach
  • Weather negatively impacted North America comps by just under 40 basis points in Q1

Key moments

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“Although certain competitors have outlined their strategy to compress restaurant margins in the sector, we are taking a disciplined approach, executing a balanced transformation that extends well beyond price, meeting customers where they are while improving 4-wall margins, elevating our fleet and supporting our franchisees to build this business for the long term.” Todd Penegor, CEO
“We are confident that we will achieve at least $60 million of North American system-wide supply chain productivity opportunities, equating to at least 160 basis points of 4-wall EBITDA improvement by 2028 for both company and franchise restaurants. In total, we expect to generate at least 200 basis points of 4-wall EBITDA improvement for both company and franchise restaurants over the medium term, driven by supply chain savings, operational efficiency and restaurant portfolio optimization.” Todd Penegor, CEO

Guidance from the call

Stated verbally and extracted from the transcript.

Metric Guided
International comparable sales
2026
2% – 4%
Adjusted D&A
2026
$70M – $75M
Supplemental marketing and franchisee subsidies investment
2026
$18M
Capital expenditures
2026
$70M – $80M

Quarter detail

How the reported period landed and where the business moved.

Revenue · segments

North America Commissary Segment$246.75M -6.7% YoY
Domestic Company Owned Restaurants Segment$139.67M -18.2% YoY
International Segment$43.23M +10.5% YoY
North America Franchising Segment$34.69M -5.8% YoY

Capital returned

Dividend / share
$0.46
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