Domino’s Announces Closure of 205 Stores, Yet Stock Prices Surge by 22%

February 7, 2025 TruthUSA

The majority of stores closing are in Japan.

Domino’s Pizza will close 205 underperforming stores globally, including 172 in Japan, to sharpen market focus and boost profit.

On the back of this news, the company’s share price soared more than 22 percent on the Australian Stock Exchange (ASX) as of Feb. 7.

Domino’s predicts an underlying net profit before tax of between $84 (US$53 million) to $86 million (pdf) for the first half of the 2025 financial year.

The fast food outlet is undertaking a major strategy review to improve performance, including the closure of stores that are not doing well.

Despite a one-off restructuring cost of $61.8 million, the closures are projected to boost annual earnings before interest and tax (EBIT) by $10 to $12 million.

Domino’s noted that of the 172 stores to close in Japan, 58 are franchised while 114 are corporate-owned.

The company explained that many stores were opened during COVID-19 when sales surged, but have since struggled with post-pandemic demand and higher input costs.

“Stores selected for closure have low weekly order volumes and limited ability to reach profitable weekly order counts in the near term,” Domino’s said (pdf).

Domino’s has identified these stores in smaller areas, such as Iwate, unable to benefit from Domino’s scale advantages, or were opened prematurely.

“Domino’s will focus on profitable order growth in prefectures where the company has a competitive advantage,” the company said.

What’s Happening on the Australian Market Today?

Domino’s is currently the top-performing stock on the ASX 200, trading at $36.23—up 22.33 percent from $29.62 on Feb. 6.

For perspective, the ASX 200, which is a list of the top 200 companies by market value, was down 0.019 percent on Feb. 7.

Aside from Domino’s, the next best-performing shares are Summerset (up 5.93 percent), Sigma Healthcare (up 4.77 percent), and Infratil (up 3.69 percent).

Domino’s Australian and New Zealand Market Outperforms

The Australian and New Zealand market for Domino’s continued to deliver positive results for the company, supported by the launch of new products including giant donuts.

A financial report reveals Domino’s achieved a 4.6 percent network sales growth in the first half of the 2025 financial year in Australia and New Zealand—outpacing Asia and Europe.

Overall, Domino’s network sales results were 1.4 percent better in the first half of the 2025 financial year, compared to the second half of the 2024 financial year.

Group CEO Mark van Dyck, who started his role at Domino’s just three months ago, said he had promised to move decisively to reshape the business for long-term success.

“Where change is required, we are acting quickly and transparently. Our priority remains clear—creating value for customers, franchise partners, and shareholders,” he said.

“Japan is an attractive market for Quick Service Restaurants and pizza, with significant long-term upside for Domino’s,” he said.

Fast Food Outlets on the Australian Market?

While Domino’s is restructuring, other fast food companies are navigating their own challenges.

Collins Food, which operates KFC and Taco Bell restaurants in Australia, reported modest growth, with KFC Australia up 2.7 percent to $536.8, but European sales slipping 3.4 percent to $142.1 million.

Meanwhile, Taco Bell’s revenue fell 2 percent, while Guzman y Gomez, a Mexican restaurant chain that joined the ASX in June 2024, will release earnings on Feb. 21.

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