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Domino's Australia shrinks: end of $5 pizza era

Domino's is closing dozens of Australian and New Zealand stores and moving away from cheap pizza deals after a $259 million asset write-down. Investors pushed the share price up 9%, but experts warn the strategy risks losing core discount customers.

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Domino's Australia shrinks: end of $5 pizza era

Domino's Australia shrinks: end of $5 pizza era

The short answer

Domino's is shrinking its Australian and New Zealand store network, closing about 29–30 outlets, after writing down $259 million in assets. The company is pivoting away from the "hard discounting" that made $5 pizzas famous, toward "targeted promotions" and "compelling value," according to Domino's Australia executive chair Jack Cowin. The change comes after years of declining share price — down 89% from $161.98 in September 2021 to $18.62 — and a broader struggle against gourmet competitors and fast-food giants. Investors responded positively, sending shares up 9% on the restructuring plan, as Nine Money Editor Effie Zahos noted they liked the idea of ditching "crazy cheap deals" and making more profit per slice.

Why it's trending

The trigger is Domino's announcement this week that it will close 29–30 stores across Australia and New Zealand, alongside a $259 million asset write-down. The news caused Domino's shares to jump 9%, sparking headlines about the end of the $5 pizza and a wave of commentary about the brand's survival strategy.

Domino's shares jumped by nine per cent this week after the company announced a $259 million write-down and the closure of 29 outlets across Australia and New Zealand, according to Nine.com.au. Real Commercial reported the closures as 30 Aussie stores, a discrepancy the sources do not reconcile. The restructuring is aimed at "rightsizing" the business, retail expert Gary Mortimer told nine.com.au, adding: "Sometimes, in order to grow, you have to shrink."

Multi-source analysis shows a company under pressure on multiple fronts. Nine.com.au quotes Domino's Australia executive chair Jack Cowin confirming a "reduced reliance on discounting" in favour of "compelling value" and "targeted promotions." Real Commercial adds that Domino's Pizza US executives directly blamed the struggling Australian offshoot for dragging down global performance, citing a disastrous sales strategy. The same outlet pointed to the share price collapse from $161.98 in September 2021 to $18.62, a fall of 89 per cent.

The timeline stretches back years. Pizza Hut peaked at around 400 stores in the mid-to-late nineties and now operates about 260. Domino's peaked at roughly 754 stores in 2022 and had around 700 before the latest closures. In February, Cowin laid out the strategy in the company's financial results release. By late July, the store closure plan was public and investors responded positively — Nine's Effie Zahos said they liked the plan to "streamline the business, ditch the crazy cheap deals and make more profit on every slice."

The shift away from hard discounting carries risks. Mortimer warned that moving away from an entrenched marketing strategy will naturally lose core customers attracted to very low prices. Real Commercial notes the same pizza that was $5 not long ago now costs as much as $16.50, while consumers' wages have not tripled. The broader question is whether Domino's can hold its market position against gourmet rivals and new fast-food entrants without the budget-price edge that made it a Friday-night staple.

Timeline

  1. Pizza Hut peak store count

    Pizza Hut reached around 400 stores in Australia, according to Nine.com.au; it now operates approximately 260.

  2. Domino's share price peak

    Domino's Australia share price reached $161.98, per Real Commercial.

  3. Domino's peak store count

    Domino's had around 754 stores in Australia before recent closures, according to Nine.com.au.

  4. Cowin confirms discounting shift

    Domino's Australia executive chair Jack Cowin stated in the company's financial results release that future focus would be on "targeted promotions" and "compelling value" rather than hard discounting, as reported by Nine.com.au.

  5. Store closures announced, shares jump

    Nine.com.au reported 29 outlets closing across Australia and New Zealand with a $259 million write-down; Real Commercial reported 30 Aussie stores. Domino's shares jumped 9 per cent the same week.

Questions people ask

Why is Domino's closing stores?

Domino's is closing stores to "streamline the business" and write down $259 million in assets, according to Nine.com.au. Retail expert Gary Mortimer called it "rightsizing" — running a smaller but more profitable fleet. Real Commercial reported 30 Aussie stores closing, while Nine said 29 outlets across Australia and New Zealand.

Is the $5 pizza really gone?

Yes, the era of cheap $5 pizzas is ending. Domino's Australia executive chair Jack Cowin confirmed a "reduced reliance on discounting," promising "compelling value" instead, per Nine.com.au. Real Commercial notes the same pizza now costs as much as $16.50.

Why did Domino's shares jump if the company is struggling?

Investors reacted positively to the restructuring plans. Nine Money Editor Effie Zahos said they liked the plan to "streamline the business, ditch the crazy cheap deals and make more profit on every slice," which was reflected in the 9 per cent share price jump this week.

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