Papa John's Q1 Earnings & Revenues Beat Estimates, Stock Up

Papa John’s International, Inc. PZZA reported first-quarter fiscal 2025 results, with adjusted earnings and revenues beating the Zacks Consensus Estimate. The top line increased year over year, while the bottom line declined from the prior-year quarter’s figure.

Following the results, the PZZA stock gained 15.9% during yesterday’s trading session. Investors responded positively to the company’s progress in driving traffic and transactions through strategic initiatives. Management highlighted sequential improvements in same-restaurant sales and transaction share gains, attributing the momentum to a balanced barbell pricing strategy.
 
Looking ahead, Papa John’s plans to build on this momentum with a traditional innovation cadence, introducing new crust flavors, pizza formats, toppings and dipping options to attract new customers and capture greater market share.

PZZA’s Q1 Earnings & Revenue Discussion

The company reported adjusted earnings per share (EPS) of 36 cents, beating the Zacks Consensus Estimate of 33 cents by 9.1%. It reported an adjusted EPS of 67 cents in the prior-year quarter. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Papa John's International, Inc. Price, Consensus and EPS Surprise

Papa John's International, Inc. price-consensus-eps-surprise-chart | Papa John's International, Inc. Quote

Quarterly revenues of $518.3 million topped the consensus mark of $510 million by 1.7%. The top line increased 0.9% on a year-over-year basis. The increase was primarily driven by an $11.4 million gain in commissary revenues, stemming from higher commodity prices despite a decline in transaction volumes. Additionally, Advertising funds revenues grew by $6.6 million, benefiting from a 100 basis point increase in the National Marketing Fund contribution rate implemented in the second quarter of 2024.

Global Restaurant Sales & Comps of Papa John’s

Total comparable sales declined 1.3% year over year compared with the 2% fall reported in the prior-year quarter. We predicted the metric to grow 2.4% year over year.

Domestic company-owned restaurant comps declined 4.6% year over year compared with a 3% fall reported in the year-ago quarter. At North America’s franchised restaurants, comps fell 2.3% year over year compared with a 1.5% fall reported in the year-ago quarter. Comps at North America’s restaurants declined 2.7% year over year compared with a 1.8% fall reported in the year-ago quarter.

Nonetheless, comps at international restaurants were up 3.2% year over year against a 2.6% decline reported in the prior-year quarter. The total global system-wide restaurant sales increased 0.6% year over year against a 0.9% fall reported in the prior-year quarter.

Operating Highlights of PZZA

During the fiscal first quarter, net income totaled $9.3 million compared with $14.9 million reported in the prior-year quarter. Our estimate for the metric was $9.4 million.

The total costs and expenses amounted to $494.3 million, up from $480.2 million in the prior-year quarter. Our estimate for the metric was $471.8 million.

Adjusted EBITDA during the quarter came in at $49.6 million compared with $60.6 million reported in the prior-year quarter.

PZZA’s Balance Sheet

As of March 30, 2025, Papa John’s cash and cash equivalents totaled $44 million compared with $38 million as of Dec. 29, 2024. At the end of the fiscal first quarter, net long-term debt (less current portion) totaled $741.9 million, up from $741.7 million as of Dec. 29, 2024.

Papa John’s Unit Developments

Papa John’s opened two new restaurants in North America in the fiscal first quarter. In the international markets, the company closed 13 restaurants. As of March 30, the company had a system-wide restaurant count of 6,019, with operations in 50 countries and territories globally.

2025 Guidance by PZZA

For fiscal 2025, the company anticipates system-wide sales to grow in the range of 2-5%, with North America and International comparable sales expected to be flat to up 2%. Adjusted EBITDA is expected to be between $200 million and $220 million.

During the fiscal year, capital expenditures are expected to be $75-$85 million. Depreciation and amortization are anticipated to be $70-$75 million.

PZZA’s Zacks Rank

Papa John’s currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Retail-Wholesale Releases

Domino's Pizza, Inc. DPZ reported first-quarter fiscal 2025 results with earnings beating the Zacks Consensus Estimate, while revenues missed the same. The company reported adjusted EPS of $4.33, up from $3.58 reported in the year-ago quarter. Revenues of $1.11 billion increased 2.5% on a year-over-year basis.

Domino's reported benefits from the Hungry for MORE strategy during the quarter, registering growth in market share across the U.S. and international segments. DPZ continued to manage controllable factors well despite a tough global environment. The strategy supported an increase in sales, store openings and profits. These factors are important for long-term value creation for franchisees and shareholders.

Brinker International, Inc. EAT reported third-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The company reported adjusted EPS of $2.66, up from $1.24 reported in the year-ago quarter. Revenues of $1.43 billion increased 27.2% on a year-over-year basis.

Brinker’s quarterly performance benefited from strong fundamentals, leading to better guest experience and steady business growth. The ongoing increase in traffic continues to drive the company’s performance.

YUM! Brands, Inc. YUM reported first-quarter 2025 results, with adjusted earnings beating the Zacks Consensus Estimate and revenues missing the same. The company reported adjusted EPS of $1.30, up from $1.15 reported in the year-ago quarter. Revenues of $1.79 billion increased 12% on a year-over-year basis.

The company’s performance reflects solid contributions from the KFC and Taco Bell divisions. On the digital front, the company reported meaningful progress, with digital sales nearing $9 billion and accounting for 55% of total sales. Franchisee feedback on Yum!’s proprietary digital platform, Byte by Yum!, remained positive, reinforcing the brand’s strategic push toward tech-driven growth.

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