Domino's Pizza falls short of US sales estimates as diners curb spending

April 27 (Reuters) - Domino's Pizza missed same-store sales estimates for the first quarter on Monday, as higher living costs tied to ongoing geopolitical and economic uncertainties prompted budget-strained Americans to cut discretionary spending, including dining out. Consumers, already burdened by high inflation and a weak labor market, are bracing for another hit from rising transportation costs that threaten to further drive up food prices, accelerating a shift toward lower-cost, at-home meals and dampening sales across restaurant and fast-food chains.

Domino's, which also announced a $1 billion share buyback program, posted quarterly U.S. same-store sales growth of 0.9%, falling short of analysts' average estimate of a 2.72% rise, according to data compiled by LSEG. U.S. consumer sentiment sank to a record low in April, as households remained focused on the inflation fallout from the Middle East conflict, while the Fed's Beige Book showed continued financial strain and rising price sensitivity. Households have also been tapping into savings to fund their spending.

The company posted a 0.4% decline in international same-store sales, compared with the estimate of a 0.7% rise, owing to pressures from franchisees in regions such as Australia.

To attract value-focused customers, Domino's has revived its $9.99 "Best Deal Ever", alongside offers such as "Mix and Match" and "Emergency Pizza", as well as rolled out items such as a Parmesan-stuffed crust pizza.

The company had said in February it expects U.S. same-store sales to grow by 3% in fiscal 2026, similar to last year, with growth higher in the first half than in the second.

Domino's posted a quarterly per-share profit of $4.13, compared with $4.33 a year earlier, weighed down by an unfavorable $30 million accounting loss tied to changes in the value of its investment in DPC Dash - an investment holding company primarily engaged in operation of fast-food restaurant chains. Analysts estimated a profit of $4.27 per share. (Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Shilpi Majumdar)