Earlier this 12 months, Yum! Manufacturers shared that it was contemplating promoting the Pizza Hut model whereas additionally sharing plans to shut round 250 underperforming eating places.
The corporate shared in its third-quarter earnings name that Taco Bell and KFC account for round 90% of its working earnings. That primarily makes Pizza Hut a drag on Yum Manufacturers that will not be price administration’s time.
Due to that, the corporate has begun a strategic overview, which may find yourself in its promoting Pizza Hut.
“The intent is for Pizza Hut to reach its full potential for the benefit of its franchisees, consumers, and employees, and to maximize value for Yum! shareholders. The review will explore a range of strategic options while Pizza Hut continues to focus on near-term business imperatives,” the corporate shared in a press launch.
Additionally Learn: Pizza Hut closing 100s of eating places nationwide
Now, rival chain Papa John’s has reported fourth-quarter earnings and has shared plans to shut round 300 underperforming places.
Papa John’s has struggled
The present financial downtrend has damage pizza chains as customers have been buying and selling down. That is behaviour that executives from chains together with McDonald’s and Walmart have famous.
“While foodservice remains dominant with nearly two-thirds ordering carryout monthly, delivery has declined from 61% in 2022 to 55% in 2025, according to the 2025 Technomic Pizza Consumer Trend Report. The most telling shift: 25% of consumers report eating more frozen pizza instead of restaurant options due to price increases,” Baking Enterprise shared.
The affect of that has been felt by Papa John’s, which reported flat income and a decline in U.S. same-store gross sales.
Papa John’s full-year gross sales:
- International system-wide restaurant gross sales have been $4.92 billion, a 1% enhance in contrast with the prior 12 months.
- North America comparable gross sales decreased 2% as home company-owned eating places have been down 3% and North America franchised eating places have been down 2%.
- Worldwide comparable gross sales elevated 5%.
- Opened 279 new eating places in fiscal 12 months 2025, comprised of 96 restaurant openings in North America and 183 restaurant openings in Worldwide markets.
- Whole revenues of $2.1 billion have been flat in contrast with the prior 12 months. Web earnings was $32 million in contrast with $84 million in 2024.
Supply: Papa John’s investor relations
CEO Todd Penegor tried to border the ends in a optimistic gentle.
“We’re inspired by the progress we’re making in our transformation as we additional reinforce our model well being, sharpen our price proposition, construct our innovation pipeline and improve the client expertise. These actions, alongside current adjustments to our organizational construction to drive efficiencies, present a robust basis for our future,” he stated within the earnings launch.
Papa John’s and Pizza Hut have seen their U.S. gross sales drop.
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Papa John’s closing round 300 places
Throughout its fourth-quarter earnings name, Papa John’s CFO Ravi Thanawala shared a part of the chain’s plan to return to U.S. same-store gross sales development.
“We have completed a strategic review of our restaurant fleet and identified targeted opportunities to strengthen it through select closures. The vast majority of our global restaurants have performed well over the years and delivered strong returns for both corporate and franchise owners,” he stated.
Some places, nonetheless, haven’t.
“We have identified approximately 300 underperforming restaurants across North America that are not meeting brand expectations or lack a clear path to sustainable financial improvement, as well as locations where we can effectively transfer sales to a nearby restaurant,” he stated.
The impacted eating places are primarily franchise-owned and are principally working at destructive four-wall EBITDA.
“We expect to close the majority of these restaurants by the end of 2027, with approximately 200 closures occurring in 2026. We believe these closures will further strengthen the system. This is the same strategy we successfully deployed during my tenure managing our international business,” he added.
The closing shops usually do lower than $600,000 in annual income.
Papa John’s will even minimize 7% of its company workforce.
Domino’s leads the pizza area
Domino’s has carved out the proper place on this market by pushing value and affordability, matched with comfort.
Whereas Pizza Hut and Papa John’s have been struggling, Domino’s has posted robust development numbers.
- International retail gross sales development (excluding overseas foreign money affect) of 4.9% for the fourth quarter; 5.4% development for fiscal 2025.
- U.S. same-store gross sales development of three.7% for the fourth quarter; 3.0% development for fiscal 2025.
- Worldwide same-store gross sales development (excluding overseas foreign money affect) of 0.7% for the fourth quarter; 1.9% development for fiscal 2025.
- International internet retailer development of 392 for the fourth quarter; international internet retailer development of 776 for fiscal 2025.
- Earnings from operations elevated 8.0% for the fourth quarter; 8.5% for fiscal 2025.
Supply: Domino’s fourth-quarter earnings launch
“In today’s value-conscious environment, the restaurants seeing success are those offering standout products and experiences across multiple dimensions,” Financial institution of America Securities analyst Sara Senatore advised Sahm Capital.
She famous that Domino’s has positioned itself for development.
“This consistent execution has allowed leading quick-service pizza chains to expand market share, and she highlights that Domino’s Pizza is positioned to continue outperforming, backed by its partnerships with delivery platforms like DoorDash,” she added.
Domino’s has additionally been helped by its lead in know-how over Pizza Hut and Papa John’s.
“Digital channels represented over 85 % of U.S. retail sales in 2024, highlighting digital dominance,” in accordance with information from CB Insights.
Associated: Iconic restaurant chain closes places, plans what’s subsequent
