Fair Value Measurements

6 Months Ended

Jun. 15, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurements

5. Fair Value Measurements

Fair value measurements enable the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The Company classifies and discloses assets and liabilities carried at fair value in one of the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

Fair Value of Cash Equivalents and Marketable Securities

The fair values of the Company’s cash equivalents and investments in marketable securities are based on quoted prices in active markets for identical assets.

Fair Value of Investments

The Company holds a non-controlling interest in DPC Dash Ltd (“DPC Dash”), the Company’s master franchisee in China that owns and operates Domino’s Pizza stores in that market. The Company accounts for its investment in DPC Dash as a trading security and records it at fair value at the end of each reporting period, with gains and losses recorded in other income or expense in its condensed consolidated statements of income. As of June 15, 2025, the fair value of the Company’s investment in DPC Dash ordinary shares is based on the active exchange quoted price for the equity security of HK$93.90 per share (HK: 1405). The Company owned 3,901,019 and 8,101,019 ordinary shares as of June 15, 2025 and December 29, 2024, respectively. The Company sold 4,200,000 ordinary shares of its investment in DPC Dash in the second quarter of 2025 for net proceeds of $44.1 million.

The Company recorded a total net negative adjustment of $16.0 million in the second quarter of 2025 and a total net positive adjustment of $8.1 million in the two fiscal quarters of 2025 to the carrying amount of its investment in DPC Dash, with the net realized and unrealized losses and gains recorded in other (expense) income in the Company’s condensed consolidated statements of income. The Company recorded a positive adjustment of $11.4 million in the second quarter of 2024 and a negative adjustment of $7.3 million in the two fiscal quarters of 2024 to the carrying amount of its investment in DPC Dash, with the unrealized gains and losses recorded in other income (expense) in the Company’s condensed consolidated statements of income.

The following tables summarize the carrying amounts and fair values of certain assets at June 15, 2025 and December 29, 2024:

	At June 15, 2025
			Fair Value Estimated Using
	Carrying		Level 1		Level 2		Level 3
	Amount		Inputs		Inputs		Inputs
Cash equivalents	$	164,990	$	164,990	$	—	$	—
Restricted cash equivalents		119,945		119,945		—		—
Investments in marketable securities		22,297		22,297		—		—
Advertising fund cash equivalents, restricted		79,325		79,325		—		—
Investment in DPC Dash		46,667		46,667		—		—

	At December 29, 2024
			Fair Value Estimated Using
	Carrying		Level 1		Level 2		Level 3
	Amount		Inputs		Inputs		Inputs
Cash equivalents	$	127,074	$	127,074	$	—	$	—
Restricted cash equivalents		140,669		140,669		—		—
Investments in marketable securities		20,638		20,638		—		—
Advertising fund cash equivalents, restricted		70,350		70,350		—		—
Investment in DPC Dash		82,699		82,699		—		—

Fair Value of Debt

The estimated fair values of the Company’s fixed rate notes are classified as Level 2 measurements, as the Company estimates the fair value amount by using available market information. The Company obtained quotes from two separate brokerage firms that are knowledgeable about the Company’s fixed rate notes and, at times, trade these notes. The Company also performed its own internal analysis based on the information gathered from public markets, including information on notes that are similar to those of the Company. However, considerable judgment is required to interpret market data to estimate fair value. Accordingly, the fair value estimates presented are not necessarily indicative of the amount that the Company or the noteholders could realize in a current market exchange. The use of different assumptions and/or estimation methodologies may have a material effect on the estimated fair values stated below.

Management estimated the approximate fair values of the Company’s 2015, 2017, 2018, 2019 and 2021 notes as follows:

	June 15, 2025				December 29, 2024
	Principal Amount		Fair Value		Principal Amount		Fair Value
2015 Ten-Year Notes	$	742,000	$	739,774	$	742,000	$	739,032
2017 Ten-Year Notes		940,000		924,020		940,000		915,560
2018 7.5-Year Notes		402,688		401,077		402,688		399,869
2018 9.25-Year Notes		379,000		374,452		379,000		370,662
2019 Ten-Year Notes		648,000		613,008		648,000		599,400
2021 7.5-Year Notes		826,625		764,628		826,625		750,576
2021 Ten-Year Notes		972,500		875,250		972,500		850,938

The Company did not have any outstanding borrowings under its variable funding notes at June 15, 2025 or December 29, 2024.