Papa John's Leverages Rising Visits And Core Pizza Focus To Ignite 2025 Growth

Papa John’s International, Inc. (NASDAQ:PZZA) shares traded higher in the premarket session on Thursday.

The company reported second-quarter adjusted earnings per share of 41 cents, beating the street view of 34 cents. Quarterly sales of $529.166 million (+4.2% year over year) outpaced the analyst consensus estimate of $515.601 million.

“We returned to comparable sales growth in North America and achieved strong sales growth internationally, driven by transaction gains as we win more customer visits with a focus on our core pizza business,” said Todd Penegor, president and CEO.

The higher revenues were primarily attributable to a $20.3 million increase in Commissary revenues, reflecting higher volumes and pricing during the quarter. 

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Global system-wide restaurant sales reached $1.26 billion, representing a 4% year-over-year increase. This performance was fueled by stronger comparable sales in North America and International markets, as well as 2% net restaurant growth over the past twelve months.

North America comparable sales rose 1% year over year, with domestic company-owned restaurants remaining flat and franchised restaurants increasing by 1%. International comparable sales increased 4% versus the prior year's second quarter.

The company opened 45 new restaurants system-wide, with 19 in North America and 26 in international markets.

Adjusted EBITDA of $52.6 million in the second quarter was down $6.3 million year-over-year, as higher revenues were more than offset by increased general and administrative expenses, which were driven by marketing and loyalty program investments and elevated incentive compensation, and higher operating costs at company-owned restaurants.

The company exited the quarter with cash and equivalents worth $33.299 million, lower than $37.955 million as of December 29, 2024.

Dividend: On August 1, the firm declared a third-quarter dividend of 46 cents per common share. The dividend will be paid on August 29.

Outlook: For 2025, the company anticipates system-wide sales growth of 2%–5%, with comparable sales in North America remaining flat to increasing by 2%, and comparable sales in International markets rising 2%–4%.

It plans to open 85–115 new restaurants in North America and 180–200 across its International markets.

Adjusted EBITDA is projected at $200–$220 million.

Price Action: PZZA shares are trading higher by 7.56% to $43.67 at last check on Thursday.

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