Domino's leads ASX 200 losses as Citi flags 'disappointing' FY26 update
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More news: Domino's shares tanked in morning trade after the pizza chain operator swung to a statutory loss for the 2025 financial year.
Shares were down 19.2% to $15.64 at 10:50am AEST. The stock has retreated 47.7% over the last 12 months.
Citi analyst William Park said the weak FY25 result "won't come as a surprise" following the unexpected resignation of CEO and managing director Mark van Dyck last month.
However, he said the FY26 update is "disappointing" and will "fuel the debate as to whether sales declines are structural or cyclical".
"Key question on our mind is how quickly the business will move on cost out so it can redirect savings to advertising and franchisees," Park noted.
Domino's swings to statutory loss, slashes dividend
The news: Pizza chain operator Domino's slumped to a statutory net loss of $3.7 million in the 2025 financial year, down from a net profit of $92.3 million in FY24, as the group flagged subdued levels of new store openings and lower franchisee profitability.
The numbers: The company, which announced the surprise resignation of CEO and managing director Mark van Dyck last month, missed consensus estimates of a $14.5 million statutory profit, according to Visible Alpha figures.
Total revenue came in at $2.3 billion, down 3.1% year on year but in line with average forecasts.
The board declared total dividends of 77 cents a share, down 27% from $1.06 a year ago, and below the $1 per share payout expected by analysts.
The context: Domino's said it saw "solid performances" in Australia and Benelux markets, with "encouraging signs of improvement" in Germany and southeast Asia, offset by "continued challenges" in France and Japan.
The company said it is making progress in identifying and delivering cost savings, with initiatives now underway to reinvest in marketing and franchisee support while further simplifying the business.
Domino's noted that new store openings will only be pursued where new stores are expected to be "sustainably profitable" and deliver a meaningful return on investment to franchise partners.
What they said: "We're taking action to make Domino's a leaner, more efficient business," said executive chair Jack Cowin.
"That means reducing costs — and using those savings to support our franchise partners and invest in marketing that drives sales."
The sources: ASX, Citi research
