DPC Dash (1405.HK) 1H 2026: The Speeding-up Pizza Giant — How to Achieve Sustained Growth in the Chinese Market

The year 2026 marks the opening of the 15th Five-Year Plan, and is also a pivotal year for the catering industry as it shifts from scale-driven expansion to quality-oriented upgrading.

Data from the National Bureau of Statistics shows that China’s catering revenue reached RMB 2.8255 trillion in the first half of 2026, representing a year-over-year increase of 2.8%. This growth rate holds up well against the broader consumption landscape. Nevertheless, the year-over-year growth of the industry slowed down by 1.5 percentage points. The cumulative growth rate of catering enterprises above designated size stood at merely 1.8% in H1 2026, persistently trailing the overall industry average, which indicates mounting pressure on leading catering players.

In other words, the overall market is still expanding, yet growth momentum is weakening. Large-scale chain brands, in particular, are confronted with notable growth headwinds.

Against such a backdrop, DPC Dash Ltd – Domino’s Pizza China (Hereafter referred to as “DPC Dash” or the “Company”) has delivered an encouraging performance for the market.

In the first half of 2026, DPC Dash posted revenue of RMB 3.134 billion, surging 20.8% year-over-year and maintaining double-digit growth for consecutive years. Its net profit hit RMB 81.05 million, representing 22.9% year-over-year growth, with the net profit margin climbing to 2.6%.

It is evident that while many chain brands are grappling with traffic challenges, this pizza giant has not decelerated; instead, it has delivered increasingly clear growth acceleration.

I. Scale Is Not an End in Itself, yet Scale-derived Momentum Is Rewriting Market Rules

According to financial results, DPC Dash achieved a net opening of 235 new stores and entered 15 new cities during the first half of 2026. As of June 30, 2026, its total network expanded to 1,550 stores across 75 cities.

On the surface, these figures reflect routine expansion for a chain brand. From a broader perspective, however, what merits attention is not merely the number of newly-opened stores, but where they are located and how they perform after launch.

Stores in non-Tier 1 cities totaled 1,018, accounting for two-thirds of the total store count. This proportion demonstrates the Company’s deep penetration into consumption hinterlands of non-Tier 1 markets. On January 1, 2026, the first store in Dalian recorded nearly RMB 700,000 in sales on its opening day, setting a new single-store single-day sales record across Domino’s global system. Shortly afterwards, the first store in Harbin broke this record with sales exceeding RMB 700,000. The RMB 700,000 opening-day performance of a pizza outlet in a new city bears witness to spontaneous consumer demand generated by accumulated brand momentum.

Another revealing metric: as of June 30, 2026, DPC Dash occupied all top 70 positions in Domino’s global ranking of stores by sales performance within the first 30 days of opening. In short, the world’s highest-performing new stores are all located in China. This validates the continuous delivery of its “Go Deeper, Go Broader broad and deep market expansion” strategy.

The feasibility of this strategy is underpinned by a bigger market logic: China’s pizza market is far from saturation. Statistics show that China only has 13.9 pizza stores per million residents, while DPC Dash registers a national penetration rate of merely 1.1 stores per million residents. Even within its existing 75 covered cities, the penetration rate stands at just 2.5 stores per million residents. This signifies substantial room for store expansion in already-entered cities, and untapped growth potential in cities yet to be covered.

Meanwhile, the market itself keeps expanding rapidly. According to CIC Consulting, the size of China’s pizza restaurant market is projected to grow from RMB 48.2 billion in 2024 to RMB 88.5 billion in 2029, at a compound annual growth rate (CAGR) of 12.9%.

In a market characterized by low penetration for both the industry and individual players alongside rapid expansion, DPC Dash’s growth is not a zero-sum game but incremental market capture. As the overall market pie keeps growing, the Company strives to secure its fair share amid market expansion.

Expansion, nonetheless, comes at a cost. DPC Dash reported negative same-store sales growth (SSSG) in H1 2026, which has sparked certain market concerns. Further decomposition indicates that demand remains robust: same-store transaction count growth (SSTG) reached 7.1%, staying positive for 22 consecutive quarters. In other words, more people are coming into the store, but each spends less money.

The underlying reasons are not complicated. Subsidies from third party platforms have driven down average order value. Meanwhile, intensive roll out of new stores has caused short term performance cannibalization for existing outlets. Nevertheless, SSSG turned positive again in May and June, indicating these short term disruptions are being absorbed.

What DPC Dash is genuinely pursuing is trading short-term same-store volatility for long-term market-share expansion. Judging from its 2026 store-opening cadence, the Company’s layout unfolds with crystal-clear logic: further deepen its foothold in established markets, raise penetration in newly-captured markets, and proactively target brand‑new geographies. This three-tier, step-by-step progression avoids “bleeding” revenue in mature markets while ensuring new markets are sufficiently resourced to fuel growth.

Its strategic cooperation with SCPG Group represents another noteworthy move. SCPG manages over 220 shopping malls across 55 cities. By leveraging this channel, DPC Dash can expand its store network in initial cityestablished markets and access new city markets at scale. This “ride-the-boat-to-sea” approach delivers far higher efficiency than negotiating rental terms and store locations on a store-by-store basis.

II. Brand Is More Than a Slogan: The Repurchase Logic Behind 41.9 Million Members

Beyond financial figures, another highlight in H1 lies in its member ecosystem: total members reached 41.9 million as of June 30, 2026, up 39.2% year-over-year, with around 18.1 million new users placing their first orders over the past 12 months.

The rapid expansion of its member base essentially reflects habitual consumer-brand connections.

Digital capabilities form the core underpinning such connections. Self-operated APPs and mini-programmes serve as repositories for its 41.9-million-strong member pool. Each order enriches user profiles to support targeted recommendations and personalized operations. Savings on third-party platform commissions are reinvested into member benefits, fostering a virtuous cycle featuring enhanced user experience, stronger stickiness and stable repeat purchases.

Product innovation constitutes another lever to sustain user loyalty. In H1, DPC Dash maintained a high-frequency new-product launch cadence, rolling out offerings such as Crispy Croissant Crust and American Inspired Pulled BBQ Pork Pizza. Amid generally declining consumer loyalty to catering brands, continuous new-product launches function as “repurchase hooks”, giving consumers fresh reasons to engage with the APP and mitigating churn caused by menu fatigue.

Besides ongoing product iteration, the Company has executed well-received marketing initiatives.

For instance, its cross-border collaboration with Arknights(明日方舟) generated considerable buzz among ACGN communities. Thirty-one theme-decorated stores rolled out limited-edition set meals bundled with collaborative merchandise. Such tactics precisely taps into the emotional value of young consumers, transforming "eating pizza" from a functional consumption into an experiential activity with social appeal and conversation starters.

Its “Victory Is OursGoal”(赢在我方) themed set meal launched during the World Cup represents another marketing innovation. Pitch-shaped square pizza bundled with side dishes and beverages catered to group viewing-party dining scenarios. This scenario-driven product philosophy essentially broadens pizza consumption occasions: pizza is no longer merely for satisfying hunger, but also for gatherings, sports viewing and celebrations.

All front-end initiatives including digital capabilities, member systems, product innovation and marketing campaigns ultimately hinge on last-mile delivery performance. For a pizza brand built on its “30-minute delivery guarantee”, seamless in-app ordering and compelling promotional campaigns count for little without hot pizza reliably delivered to customers’ doorsteps — the moment that builds genuine consumer trust.

This is where the Company demonstrates proven strengths. In the first half of 2026, its takeaway delivery sales surged 44.7% year-on-year, accounting for 51.7% of total revenue, an 8.6-percentage-point increase year-on-year. Its on-time delivery rate for the 30-minute guarantee remained high at 93.6% amid rapid store expansion, proving the resilience of its delivery network. All prior investments in digital dispatching, member operations, R&D and marketing culminate in every on-time delivery. Each completed transaction reinforces brand trust; every punctual delivery represents a tangible deposit into the brand’s trust account.

III. Supply Chain Is Not Merely a Cost Item, but an Invisible Moat

If physical stores and brand assets represent the visible competitive strengths of DPC Dash, its supply chain constitutes its invisible backbone. In August this year, its fourth supply-chain centre (SCC) commenced operation in Wuhan, further reinforcing this backbone.

Located in the Caidian Sino-German International Industrial Park and boasting a total floor area exceeding 5,000 square metres, the Wuhan SCC functions as a smart supply-chain hub integrating five core systems: order management, transportation management, warehouse management, appointment scheduling and AI-powered transport optimization.

Technologies including barcode management, voice-directed picking and intelligent route planning translate into tangible business outcomes: faster, more cost-effective ingredient delivery with consistent quality to each store. A full cold-chain monitoring system enables 24-hour temperature tracking from central kitchens to individual outlets. For Domino’s, which positions freshness as its core selling proposition, this forms the fundamental operational baseline.

Beyond operational improvements, the Wuhan project carries profound strategic geographic significance. As a national logistics hub city, Wuhan enables coverage across central and western China. Amid the Company’s rapid store expansion in central-western regions, the launch of the Wuhan SCC eliminates reliance on long-distance supply routes for new stores in these areas, substantially lifting supply efficiency and stability.

The Company has secured sites for two additional SCC facilities in Chengdu and Nanjing, scheduled for commissioning in the second half of 2027. Together with existing hubs in Shanghai, Beijing, Dongguan and Wuhan, the future network will cover five major regions: East, North, South, Central and Southwest China. While store formats can be replicated quickly, building a supply-chain network demands sustained long-term capital and resource investment — this forms its hard-to-replicate competitive barrier.

Notably, headquartersgroup-level expenses as a percentage of total revenue declined from 8.1% to 7.5% in H1 2026, a 0.6-percentage-point improvement. Though seemingly modest in isolation, such efficiency gains deliver amplified profit elasticity as scale accumulates.

Conclusion

Returning to the fundamental question: what exactly is DPC Dash pursuing?

On the surface, it opens stores, builds brand equity and constructs supply-chain infrastructure. These practices are not unique and are adopted by comparable catering peers.

Its core competitive edge lies in simultaneously pursuing both speed and depth through a holistic strategy. Store expansion delivers growth speed, supply-chain development underpins operational depth, and brand operations drive user stickiness. The three dimensions reinforce one another in a virtuous cycle: more stores generate greater procurement scale and higher brand exposure; a robust supply chain supports accelerated store rollout and consistent product quality; superior user experience translates into higher repurchase rates and member growth.

The speeding-up pizza giant shows no signs of deceleration, and its growth journey in China is just entering deeper waters.