Domino’s is thriving this year, but its major publicly traded rivals? Not so much. Case in point: the Q3 2025 numbers for Papa Johns, the No. 4 pizza brand.
Just as Pizza Hut U.S. suffered a lackluster quarter compared to 2024, Papa Johns also saw its North American comparable sales dip to the tune of 2.7% in the same period. Meanwhile, a bid to take Papa Johns private reportedly fell through earlier this week after Apollo Global, a private equity firm, withdrew its offer, according to Reuters.
In an earnings call with investors on Thursday, CEO Todd Penegor addressed the “recent M&A rumors and speculation,” presumably referring to the abandoned buyout bid. Although he stressed that Papa Johns remains laser-focused on its Back to Better 2.0 strategy, his measured words hinted that an acquisition is not out of the question.
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“We are open-minded about the path to do that,” Penegor said, “and to the extent that there is an alternative to our strategy that is available and maximizes shareholder value, we would fully consider it. At this time, the opportunity before the company to drive the greatest value creation is through the execution of our transformation strategy, and that is where we have directed our attention.”
Papa Johns sold more pizzas in the third quarter of 2025, but its North American same-store sales dropped 2.7%, as customers cut back on sides and other non-pizza items, Penegor said.
Faced with stubborn inflation and economic worries, consumers “tend to control their spend by focusing on center of plate,” he said. “The majority of North America sales pressure was driven by declines in products outside of our core pizza offering, including wings, bread, sides, Papadias and Papa Bites.”
“We sold 3% more pizzas and 4% more pizzas per order, but total pizza sales were effectively flat as order mix shifted to more medium pizzas and fewer added toppings,” he noted.
On the bright side, Papa Johns’ international sales are doing fine—they were up 7.1% in Q3 compared to the same quarter last year. In North America, Papa Johns has recently followed Domino’s example by offering steep discounts, including a 50% value deal on carryout orders as well as a BOGO offer. The 50%-off deal was aimed at small-ticket, low-frequency customers, Penegor said. “Very preliminary results show improved order trends, but we would like to see the offer out in the market longer before making any definitive statements.”
He said the BOGO offers in mid-September and mid-October “were effective in driving orders with multiple pizzas and bending the trends for select weeks.” Meanwhile, the carryout deal “is really a basket-starter, and we see that consumers build a more holistic basket once they get into that promotion,” Penegor said.
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“Transformation” was a keyword often repeated in the earnings call. “While we address the immediate market headwinds, particularly in North America, and execute our transformation strategy, we’re also working to be a more nimble, efficient organization with a leaner G&A structure,” Penegor said.
In particular, the brand has launched a review of its cost structure to identify savings and cut expenses in “non-customer-facing” areas. It has already identified at least $25 million in savings over the next two years, according to Penegor.
Refranchising is a key component of Papa Johns’ strategy in the next two years. “In terms of scale, we expect to reduce our company restaurant ownership to a mid-single-digit percent of the North American system,” Penegor said. “We believe that refranchising with strategy-forward, well-capitalized, growing franchisees strengthens the long-term health of the Papa Johns system and unlocks future growth opportunities.”
Toward that end, the brand expects to sell its ownership stake in a joint venture that operates 85 stores in the Mid-Atlantic region in the fourth quarter. “Those restaurants will be operated by a growth-minded franchisee with the requisite capital and strategic approach to grow their business,” Penegor said.
Papa Johns has been a publicly traded corporation since 1993. This past June, Apollo Global and Irth Capital Management made a joint offer to purchase Papa Johns at just over $60 per share and take it private, Reuters reported. Apollo Management came back with a more generous solo offer—$64 per share—in early October before dropping it this week. Meanwhile, Papa Johns’ rival, Pizza Hut, could be up for sale by parent company Yum! Brands after a poor Q3 that saw a 6% decline in same-store sales and a 7% drop in systemwide sales.
