Papa John's International, Inc., traded on the Nasdaq Global Select Market under the symbol PZZA, is one of the major global quick-service pizza businesses. The company began on October 2, 1984, in Jeffersonville, Indiana, when founder John Schnatter launched the first Papa John's operation. The company subsequently expanded nationally, became ...Papa John's International, Inc., traded on the Nasdaq Global Select Market under the symbol PZZA, is one of the major global quick-service pizza businesses. The company began on October 2, 1984, in Jeffersonville, Indiana, when founder John Schnatter launched the first Papa John's operation. The company subsequently expanded nationally, became publicly traded in 1993, and developed an international franchise network. Its corporate headquarters are in Louisville, Kentucky, and Todd Allan Penegor serves as chief executive officer.\n\nThe company's core offering is pizza sold primarily through delivery and carryout channels. The menu generally includes a range of pizzas, specialty pizzas, crust options, bread products, chicken items, desserts, and beverages. Customer orders are placed through restaurants, the company website, mobile applications, telephone channels, and third-party delivery platforms in selected markets. Digital ordering, loyalty programs, promotional pricing, and delivery convenience are important components of the customer proposition. The brand is historically associated with an emphasis on ingredient quality and its slogan, \"BETTER INGREDIENTS. BETTER PIZZA.\"\n\nPapa John's operates through several interconnected activities. Company-owned restaurants generate direct restaurant sales and provide operating experience, while franchised restaurants generate royalties, fees, and other franchise-related revenue with lower direct store-level capital requirements. North American commissary operations support the system by preparing and distributing pizza dough and other supplies to restaurants. This supply-chain capability helps standardize products, support food quality, and improve purchasing and distribution efficiency. International operations are primarily franchise-oriented and extend the brand into approximately 50 countries and territories.\n\nThe supplied company description reported approximately 5,650 locations as of December 26, 2021, consisting of about 600 company-owned restaurants and 5,050 franchised locations. Store counts and ownership mix can change over time, so those figures should be viewed as a historical reference rather than a current census. The supplied workforce figure is approximately 9,400 full-time employees, which places the company in the 5,001-10,000 employee category; the broader restaurant system also depends on many franchisee employees who may not be included in the corporate full-time employee count.\n\nFrom a financial perspective, the supplied trailing-twelve-month data showed approximately $805 million in market capitalization, an enterprise value of about $997 million, revenue-based valuation metrics below one times sales, and an enterprise-value-to-EBITDA multiple of approximately 4.2 times. Reported trailing-twelve-month revenue profitability was modest, including an EBITDA margin of about 12.1%, an EBIT margin of about 7.4%, and a net profit margin of about 1.4%. The data also showed negative book value per share, working capital of approximately negative $48 million, and a dividend yield of roughly 7.5% based on the supplied market snapshot. These metrics can be affected by leverage, share repurchases, franchise accounting, restructuring, taxes, and market-price changes, and therefore should not be interpreted as a complete investment conclusion. Key business priorities include maintaining food and service consistency, improving restaurant-level economics, supporting franchisee health, expanding international locations, strengthening digital sales, managing labor and commodity costs, and balancing capital investment, debt, and shareholder distributions.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$2.1B
-0.3%
+0.8%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$30.5M
-63.4%
+17.6%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+28.9%
+2.4%
+3.3%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
+4.3%
-43.0%
-4.7%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
+1.5%
-63.3%
+16.7%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$61.3M
+79.5%
+350.4%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
+3.0%
+80.0%
+348.5%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
-245.7%
-8.7%
+2.6%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
0.82x
-1.6%
-1.9%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Operator: Good day, and thank you for standing by. Welcome to Papa John's First Quarter 2026 Earnings Conference Call and webcast. [Operator Instructions] Please be advised, today's conference is being recorded. I would now like to turn the conference over to your speaker today, Heather Hollander. Please go ahead.
Heather Hollander: Good morning, and welcome to our first quarter 2026 earnings conference call. Earlier this morning, we issued our earnings release, which can be found on our Investor Relations website at ir.papajohns.com under the News and Events tab or by contacting our Investor Relations department. Joining me on the call this morning are Todd Penegor, President and Chief Executive Officer; and Ravi Thanawala, Chief Financial Officer and President, North America. Comments made during this call will include forward-looking statements within the meaning of the federal securities laws. These statements may involve risks and uncertainties that could cause actual results to differ materially from these statements. Forward-looking statements should be considered in conjunction with the cautionary statements in our earnings release and the risk factors included in our SEC filings. In addition, please refer to our earnings release and our Investor Relations website for the required reconciliation of non-GAAP financial measures discussed on today's call. Lastly, we ask that you please limit your questions to one question and one follow-up. And now I'll turn the call over to Todd.
Todd Penegor: Thank you, Heather, and good morning, everyone. During the first quarter, we continued to execute our transformation plan to be the best pizza makers in the business. I am proud of the work our team is doing to navigate the current consumer backdrop and highly promotional QSR marketplace. Although certain competitors have outlined their strategy to compress restaurant margins in the sector, we are taking a disciplined approach, executing a balanced transformation that extends well beyond price, meeting customers where they are while improving 4-wall margins, elevating our fleet and supporting our franchisees to build this business for the long term. While transformation work is neither linear nor instant, we are confident that the progress we are making in Papa John's transformation, combined with the strength of our brand and quality of our pizza will fuel profitable growth and value creation over the long term for all our stakeholders. Now turning to our quarterly results. In our international business, results continue to be strong. We delivered 3.6% comparable sales growth, marking six consecutive quarters of positive comps, driven by the benefits of our transformation initiatives. We continue to see strong performance in our focus markets in the first quarter, including Europe, the Middle East and Asia Pacific. In the U.K., comparable sales growth accelerated to 11% compared with 7% in the fourth quarter, driven by strong operational execution …
