Papa John’s misses quarterly results estimates as living costs soar

May 7 (Reuters) – Papa John’s International missed expectations for first-quarter revenue and profit on Thursday as the pizza chain failed to draw diners, especially in its U.S. market, at a time when consumers struggle with high living costs.

Shares of the company fell about 4% in premarket trading. 

Several U.S. restaurant chains including McDonald’s and Domino’s reported weaker quarterly sales growth, citing a hit to customer spending from soaring gasoline prices driven by the Iran war.

• North America comparable sales, which include franchise and company-owned restaurants open for at least a year, fell 6.4% for the third consecutive quarter.

• The company is navigating a cautious consumer environment and promotional quick-service restaurant marketplace, CEO Todd Penegor said.

• Quarterly revenue fell 7.7% to $478.6 million, compared with analysts’ average estimate of $485.7 million, according to data compiled by LSEG.

• The company reported adjusted earnings of 32 cents per share, compared with analysts’ estimate of 35 cents per share.

• It also reiterated its annual forecasts.

• The results come amid Irth Capital’s offer to pay $47 a share to buy Papa John’s International in March, valuing the pizza chain at $1.5 billion, in a second attempt after it tried to buy the pizza chain alongside Apollo Global Management last year, according to a Reuters report.

(Reporting by Krisha Bhatt in Bengaluru; Editing by Pooja Desai)