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Photo: Scott Olson/Getty Images

Domino's Pizza has shunned delivery app giants Uber Eats, DoorDash and GrubHub, and the pizza chain's CEO confirmed the company has no plans of collaborating with them any time soon.

Why it matters: While its No. 1 competitor, Yum Brands' Pizza Hut, has partnered with and taken a stake in the to-go dining app GrubHub, Domino's has banked on its technological investments in delivery and user operations to beat out competition, the Wall Street Journal (subscription) reports.

"Our same-store sales performance for the quarter came in toward the lower end of our 3-year to 5-year outlook, as we continue to navigate through headwinds related to aggressive activity from third-party delivery aggregators. I do not expect this activity to ease in the near term."
— Domino's CEO Ritch Allison, in a Q2 earnings call

By the numbers:

  • U.S. same-store sales growth at Domino's has tapered off, and in the most recent quarter, the company reported 3% same-store sales growth — the slowest in at least 3 years, per Reuters.
  • The results disappointed Wall Street, and shares of Domino's fell more than 8% after the news broke.

Domino's still holds the largest market share in the pizza sector. But as the multinational restaurant doubles down on delivery technology, company executives are more concerned about delivery apps boosting demand for their competitors' food, not the competitors themselves.

  • For instance, valued at $12.6 billion, privately held DoorDash is now worth more than Domino’s, which has a market cap of $10.43 billion.
  • With the exception of UberEats and GrubHub, the delivery apps are backed by venture capital, and as private markets, they have patience the public markets do not.

What they’re doing: From chatbots to drones and its newly expanded driverless delivery cars, the world's largest pizza chain has been upping its investments for the past decade in technologies to give its customers a more seamless experience, and the push internally for innovation only continues.

  • Domino’s has been testing Ford-built, self-driving delivery vehicles in Michigan and Miami for several years. In June, Domino’s announced autonomous-vehicle startup Nuro will make a custom driverless fleet of cars for pizza deliveries in Houston later this year.
  • A Domino’s division in Australia and New Zealand began testing AI cameras that photograph and grade each pizza on different criteria to control quality. Auckland, New Zealand has also been home to pizza delivery by drone for the past 3 years.
  • Domino's has delivered to more than 200,000 nontraditional locations in the U.S., like parks and beaches.
  • The company’s voice-recognition system, “Dom,” has been automating telephone orders in about 40 stores since last year.

The bottom line: Outside delivery companies pose a real threat to about 20-25% of Domino's locations, Morgan Stanley analyst John Glass said in a research note Thursday. This competition could chip away at sales growth by up to 2% for locations open for a year or more.

Go deeper

In photos: Protesters rally for George Floyd ahead of Derek Chauvin's trial

Chaz Neal, a Redwing community activist, outside the Minnesota Governor's residence during a protest in support of George Floyd in St.Paul, Minnesota, on March 6. Photo: Kerem Yucel/AFP via Getty Images

Dozens of protesters were rallying outside the Minnesota governor's mansion in St Paul Saturday, urging justice for George Floyd ahead of former Minneapolis police officer Derek Chauvin's trial over the 46-year-old's death.

The big picture: Chauvin faces charges for second-degree murder and manslaughter over Floyd's death last May, which ignited massive nationwide and global protests against racism and for police reform. His trial is due to start this Monday, with jury selection procedures.

Biden says $1,400 stimulus payments can start going out this month

Photo: Samuel Corum/Getty Images

President Biden said Saturday that the Senate passage of his $1.9 trillion COVID relief package means the $1,400 direct payments for most Americans can begin going out later this month.

Driving the news: The Senate voted 50-49 Saturday to approve the sweeping legislation. The House is expected to pass the Senate's version of the bill next week before it heads to Biden's desk for his signature.