Guidance and Outlook Adjustments
Q: Why did you adjust the 2024 EBIT outlook?
A: Despite a strong Q1 EBIT, we're taking a cautious approach for the rest of the year due to a more value-conscious consumer and increased check management. We plan to test pricing strategies and media mix aggressively, which may impact operating income. We're focused on driving unit-level economics for long-term growth.

Consumer Softness Impact
Q: What changed in consumer behavior to cause softer sales?
A: We've observed consumers are managing their spending more carefully, leading to higher exit rates in the purchasing funnel and softer sales starting in March. This shift towards value orientation is affecting traffic and average ticket.

Strategies Amid Value-Conscious Consumers
Q: How will you grow transactions without matching competitor promotions?
A: We have multiple levers to demonstrate value, such as leveraging our loyalty program, enhancing our carryout business with targeted pricing and promotions, and emphasizing our core pizza offerings. We aim to communicate value effectively without heavy discounting.

Aggregator Channel Growth
Q: How is the aggregator channel performing?
A: The aggregator channel now represents 16% of our business in Q1, up from 12% last year. It's outperforming our organic delivery and carryout channels, attracting younger, more diverse customers. We're focused on improving our organic channels while capitalizing on aggregator growth. ,

International Performance
Q: How are international comps, especially in the Middle East and other markets?
A: The Middle East showed over a 10-point acceleration in comp run rate in Q1. In the U.K., comps were flat to slightly negative, but seasoned operators saw double-digit sales increases. Chile, our largest market in Latin America, had its strongest performance, improving our trajectory. Strategic closures in China are also leading to comp improvements. We're focusing on key regions for growth. ,

Development Pipeline and Cost Controls
Q: What's the outlook for North American development and cost management?
A: We've reaffirmed a 20% year-over-year increase in North American development. Our pipeline is meaningfully above this target, and we're confident in meeting our objectives. We're implementing cost-saving measures in construction and equipment procurement to improve unit economics and ensure healthy returns. ,

G&A Expenses and Cost Discipline
Q: Are there opportunities to get more efficient on G&A expenses?
A: We're maintaining a disciplined approach to costs while investing in strategic growth areas like product innovation, marketing, and technology. Adjusted G&A is expected to be slightly above $50 million per quarter for the next few quarters. We're continuously seeking ways to streamline operations and enhance unit economics.

Average Ticket Decline and Check Management
Q: How much did average ticket decline, and what's causing it?
A: Average ticket declined by about 0.5% in Q1, driven by decreased sales in sides, beverages, and delivery fees, while pizza sales increased. Consumers are focusing on our core pizza products and pulling back on add-ons, reflecting value-conscious behavior. ,

Impact of Promotional Strategies
Q: Is shifting away from regional marketing affecting results?
A: Sales softness began before we launched the new national marketing strategy. We believe the challenges are due to consumer value orientation rather than the shift from regional marketing. Purchase intent is increasing with our new creative and media approach, and we're confident in our strategy.

Service Improvements in Key Markets
Q: Are service levels improving in the U.K.?
A: Yes, we're seeing improvements in delivery and out-the-door times in the U.K., contributing to better customer experiences and supporting sales growth in that market.