PAPA JOHNS INTERNATIONAL INCPZZA
PAPA JOHNS INTERNATIONAL INC Segments Disclosure
22. Segment Information
We have four reportable segments: Domestic Company-owned restaurants, North America franchising, North America commissaries, and International operations. The Domestic Company-owned restaurants segment consists of the operations of all Domestic Company-owned restaurants and principally generates revenues from retail sales of pizza and other food and beverage products. The North America franchising segment consists of our franchise sales and support activities and derives its revenues from sales of franchise and development rights and the collection of royalties from our franchisees located in the United States and Canada. The North America commissaries segment consists of the operations of our regional dough production and product distribution centers in the United States and Canada and derives its revenues principally from the sale and distribution of food and paper products to Domestic Company-owned and franchised restaurants in the United States and Canada. The International segment consists of distribution sales to franchised Papa Johns restaurants located in the UK and our franchise sales and support activities, which derive revenues from sales of franchise and development rights and the collection of royalties from our International franchisees, as well as the operations of all Company-owned restaurants located in the UK. International franchisees are defined as all franchise operations outside of the United States and Canada. Our reportable segments are distinct business units that provide different products or services. Separate management of each segment is required because each business unit is subject to different operational issues and strategies. Certain administrative and capital costs are allocated to each of our segments based upon predetermined rates or estimated resource usage.
All other business units that do not meet the quantitative or qualitative thresholds for determining reportable segments, which are not operating segments, we refer to as “All Other”. These consist of operations that derive revenues from franchise contributions to marketing funds and information systems and related services used in restaurant operations, including our point-of-sale system, online and other technology-based ordering platforms.
Our chief operating decision maker (“CODM”) is the Chief Executive Officer. Beginning in the first quarter of 2025, the Company updated its measure of segment profit or loss to be adjusted EBITDA, which aligns with how the CODM evaluates performance of and allocates resources to our segments. For comparability purposes, segment results for the prior year period have been recast to reflect this change in measure of segment profit or loss. Adjusted EBITDA represents Net income before Net interest expense, Income tax expense, Depreciation and amortization, Stock-based compensation expense, and other adjustments that vary from period to period, including certain general and administrative expenses and
other items that do not reflect normal, recurring expenses necessary to operate our business. During the annual budget and forecasting process, the CODM uses adjusted EBITDA to allocate resources (including employees, property, and financial or capital resources) to the segments. The CODM regularly reviews trends in adjusted EBITDA on at least a quarterly basis to evaluate the profitability of the segments and to make resource allocation decisions. When our CODM reviews balance sheet information, it is at a consolidated level.
Segment Results
The tables below present our operating results by segment (in thousands). The significant expense categories and amounts presented in the tables below align with the segment-level information that is regularly provided to the CODM. A reconciliation to Company results is included in the following section.
| Year Ended December 28, 2025 | ||||||||||||||||||||||||||||||||
| Domestic Company-owned restaurants | North America franchising | North America commissaries | International | Total | ||||||||||||||||||||||||||||
| Revenues from external customers | $ | 662,523 | $ | 139,009 | $ | 854,188 | $ | 173,836 | $ | 1,829,556 | ||||||||||||||||||||||
| Intersegment revenues | — | 4,470 | 203,900 | — | 208,370 | |||||||||||||||||||||||||||
| Segment revenue | $ | 662,523 | $ | 143,479 | $ | 1,058,088 | $ | 173,836 | $ | 2,037,926 | ||||||||||||||||||||||
Less segment expenses(a): | ||||||||||||||||||||||||||||||||
| COS - Product Costs | $ | 203,443 | $ | — | $ | 756,772 | $ | 50,337 | $ | 1,010,552 | ||||||||||||||||||||||
| COS - Salaries & Benefits | 221,033 | — | 121,466 | 7,470 | 349,969 | |||||||||||||||||||||||||||
COS - Other (b) | 168,971 | — | 66,498 | 33,022 | 268,491 | |||||||||||||||||||||||||||
| General & Administrative | 40,705 | 38,115 | 34,533 | 40,339 | 153,692 | |||||||||||||||||||||||||||
Other Segment Expenses (d) | — | — | — | 20,087 | 20,087 | |||||||||||||||||||||||||||
| Segment adjusted EBITDA | $ | 28,371 | $ | 105,364 | $ | 78,819 | $ | 22,581 | $ | 235,135 | ||||||||||||||||||||||
| Year Ended December 29, 2024 | ||||||||||||||||||||||||||||||||
| Domestic Company-owned restaurants | North America franchising | North America commissaries | International | Total | ||||||||||||||||||||||||||||
| Revenues from external customers | $ | 692,736 | $ | 139,091 | $ | 831,774 | $ | 174,054 | $ | 1,837,655 | ||||||||||||||||||||||
| Intersegment revenues | — | 4,150 | 205,234 | — | 209,384 | |||||||||||||||||||||||||||
| Segment revenue | $ | 692,736 | $ | 143,241 | $ | 1,037,008 | $ | 174,054 | $ | 2,047,039 | ||||||||||||||||||||||
Less segment expenses(a): | ||||||||||||||||||||||||||||||||
| COS - Product Costs | $ | 207,704 | $ | — | $ | 756,170 | $ | 51,889 | $ | 1,015,763 | ||||||||||||||||||||||
| COS - Salaries & Benefits | 225,269 | — | 116,645 | 13,759 | 355,673 | |||||||||||||||||||||||||||
COS - Other (b) | 177,656 | — | 62,166 | 38,490 | 278,312 | |||||||||||||||||||||||||||
General & Administrative (c) | 38,448 | 33,028 | 36,278 | 37,984 | 145,738 | |||||||||||||||||||||||||||
Other Segment Expenses (d) | — | — | — | 13,635 | 13,635 | |||||||||||||||||||||||||||
| Segment adjusted EBITDA | $ | 43,659 | $ | 110,213 | $ | 65,749 | $ | 18,297 | $ | 237,918 | ||||||||||||||||||||||
| Year Ended December 31, 2023 | ||||||||||||||||||||||||||||||||
| Domestic Company-owned restaurants | North America franchising | North America commissaries | International | Total | ||||||||||||||||||||||||||||
| Revenues from external customers | $ | 726,362 | $ | 144,550 | $ | 852,361 | $ | 182,487 | $ | 1,905,760 | ||||||||||||||||||||||
| Intersegment revenues | — | 4,267 | 210,614 | — | 214,881 | |||||||||||||||||||||||||||
| Segment revenue | $ | 726,362 | $ | 148,817 | $ | 1,062,975 | $ | 182,487 | $ | 2,120,641 | ||||||||||||||||||||||
Less segment expenses(a): | ||||||||||||||||||||||||||||||||
| COS - Product Costs | $ | 215,545 | $ | — | $ | 787,966 | $ | 54,514 | $ | 1,058,025 | ||||||||||||||||||||||
| COS - Salaries & Benefits | 237,292 | — | 118,678 | 17,853 | 373,823 | |||||||||||||||||||||||||||
COS - Other (b) | 184,015 | — | 60,009 | 43,132 | 287,156 | |||||||||||||||||||||||||||
General & Administrative (c) | 37,131 | 10,617 | 33,759 | 30,269 | 111,776 | |||||||||||||||||||||||||||
Other Segment Expenses (d) | — | — | — | 13,495 | 13,495 | |||||||||||||||||||||||||||
| Segment adjusted EBITDA | $ | 52,379 | $ | 138,200 | $ | 62,563 | $ | 23,224 | $ | 276,366 | ||||||||||||||||||||||
______________________________
(a) Segment expenses exclude Depreciation and amortization, Stock-based compensation expense, and certain General and Administrative expenses and other items that do not reflect normal, recurring expenses necessary to operate our business (see reconciliation that follows).
(b) We began including “COS - Other” as a significant expense category beginning in the first quarter of 2025, consistent with the segment expense categories regularly provided to the CODM when evaluating segment performance and allocating resources. “COS - Other” includes delivery expenses, Company-owned restaurant advertising costs, insurance, rent, aggregator fees, and other costs of sales. For comparability purposes, we have recast prior period segment results to include this expense category.
(c) As previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024, the Company prospectively adjusted for updates in internal cost allocation methodologies in 2024, which increased the amount of internal general and administrative expenses allocated to the segments from Unallocated corporate expenses. The allocation updates resulted in the following increases to segment G&A in 2024 compared to 2023: $0.4 million to Domestic Company-Owned restaurants, $22.9 million to North America franchising, $3.3 million to International and $0.1 million to North America commissaries. There was no impact on overall company profitability, as the change was offset within Unallocated corporate expenses (see reconciliation table below).
(d) Other Segment Expenses represent all operating expenses that are not included in the significant segment expense categories. The components of Other Segment Expenses are advertising fund expenses and other operating expenses.
Reconciliation of Segment Results to Company Results
The following table reconciles Total Revenues from our segments to Total Revenues and Total Adjusted EBITDA from our segments to Income before income taxes (in thousands):
| Year Ended | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Total Segment revenue | $ | 2,037,926 | $ | 2,047,039 | $ | 2,120,641 | ||||||||||||||
All Other revenue (a) | 286,395 | 279,385 | 296,440 | |||||||||||||||||
| Elimination of intersegment revenue | (270,513) | (267,037) | (281,368) | |||||||||||||||||
| Total Revenues | $ | 2,053,808 | $ | 2,059,387 | $ | 2,135,713 | ||||||||||||||
| Year Ended | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Total Segment adjusted EBITDA | $ | 235,135 | $ | 237,918 | $ | 276,366 | ||||||||||||||
All Other adjusted EBITDA (a) | 27,012 | 27,800 | 29,151 | |||||||||||||||||
Unallocated corporate expenses, adjusted (b) | (61,036) | (38,538) | (66,505) | |||||||||||||||||
| Elimination of intersegment (profit) loss | — | — | 27 | |||||||||||||||||
Other income/(expense) adjustments to reconcile to income before income before income taxes (c) | (111,964) | (70,476) | (91,897) | |||||||||||||||||
| Net interest expense | (40,769) | (42,578) | (43,469) | |||||||||||||||||
| Income before income taxes | $ | 48,378 | $ | 114,126 | $ | 103,673 | ||||||||||||||
______________________________
(a) As noted in the commentary above, All Other revenue and adjusted EBITDA is derived from business units that do not meet the quantitative or qualitative thresholds for determining reportable segments. These consist of operations that derive revenues from franchise contributions to marketing funds and information systems and related services used in restaurant operations, including our point-of-sale system, online and other technology-based ordering platforms. Our largest marketing fund is PJMF, which is designed to operate at break-even for the purpose of designing and administering advertising and promotional programs for all participating Domestic restaurants. Technology-based franchisee fees are meant to offset the costs of building, operating, and depreciating technology that supports franchisee operations. As such, these fees may vary from period to period, as they are designed to operate near break-even over time including the impact of depreciation.
(b) Unallocated corporate expenses represent administrative fees incurred by the restaurant support centers, including information systems and related services, corporate salaries and bonuses, and other corporate costs. These expenses are adjusted for depreciation and amortization, stock-based compensation expense, and certain general and administrative expenses and other items that do not reflect normal, recurring expenses necessary to operate our business (see reconciliation that follows).
(c) Other income/(expense) adjustments represent Depreciation and amortization, Stock-based compensation expense, and certain general and administrative expenses and other items that do not reflect normal, recurring expenses necessary to operate our
business. As such, management excludes these items from the calculation of adjusted EBITDA. For the periods above, the adjustments include:
| Year Ended | ||||||||||||||||||||
| (In thousands) | December 28, 2025 | December 29, 2024 | December 31, 2023 | |||||||||||||||||
| Depreciation and amortization | $ | 92,245 | $ | 69,407 | $ | 64,090 | ||||||||||||||
| Stock-based compensation expense | 14,980 | 9,590 | 17,924 | |||||||||||||||||
Gain on refranchising transaction, net and sale of QC Center properties (a) | (17,053) | (41,289) | — | |||||||||||||||||
Restructuring costs (b) | 13,780 | 27,273 | 2,178 | |||||||||||||||||
Other costs (c) | 8,012 | 5,495 | 3,462 | |||||||||||||||||
UK repositioning and acquisition-related costs (d) | — | — | 4,243 | |||||||||||||||||
| Other (income)/expense adjustments | $ | 111,964 | $ | 70,476 | $ | 91,897 | ||||||||||||||
(a) For the year ended December 28, 2025, represents pre-tax gain on sale, net of transaction costs, realized upon the completion of the refranchising of 85 restaurants on November 24, 2025. Net gain attributable to noncontrolling interests for the transaction was approximately $1.0 million. See “Note 21. Divestitures for additional details. For the year ended December 29, 2024, represents pre-tax gain on sale, net of transaction costs, realized upon the August 2, 2024 completion of the sale of our Texas and Florida QC Center properties. See “Note 21. Divestitures” for additional details.
(b) Represents costs associated with the Company’s Enterprise Transformation Plan and International Transformation Plan. Includes non-cash reversal of $1.2 million and $0.1 million related to the forfeiture of unvested stock-based compensation awards during the years ending December 28, 2025 and December 29, 2024, respectively. See “Note 16. Restructuring” for additional details.
(c) For the year ended December 28, 2025, other costs is comprised of the following:
i.Losses on disposal of equipment incurred in connection with the termination of a COVID-era program that pre-purchased store equipment due to supply chain challenges;
ii.Costs associated with project-based strategic initiatives that are not related to our ongoing operations.
iii.Costs incurred, net of anticipated insurance recoveries, arising from tornadoes that damaged the Texas QC Center as well as the restaurant support center and QC Center in Louisville, Kentucky.
For the year ended December 29, 2024, other costs represents non-cash impairment and remeasurement charges related primarily to fixed and intangible assets from the refranchising of 15 Domestic Company-owned restaurants.
(d) Represents costs associated with repositioning the UK portfolio in 2023 as well as transaction costs related to the acquisition of restaurants from franchisees.
Disaggregation of Revenue
Our segments earn revenue from both external and internal customers. No single external customer accounted for 10% or more of our total revenues. Our intersegment revenues primarily represent revenue earned by our QC Centers from the sale of food and paper products to our Company-owned restaurants and collection of technology fees and marketing fees from our Company-owned restaurants. We account for intercompany sales and transfers as if the sales or transfers were to third
parties and subsequently eliminate the activity. The accounting policies of our segments are the same as those described in Note 2. Significant Accounting Policies.
In the following tables, revenues are disaggregated by major product line. The tables also include a reconciliation of the disaggregated revenues by the reportable segment (in thousands):
| Year Ended December 28, 2025 | ||||||||||||||||||||||||||||||||||||||||||||
| Domestic Company-owned restaurants | North America franchising | North America commissaries | International | All Other | Elimination of Intersegment Revenue | Total | ||||||||||||||||||||||||||||||||||||||
| Company-owned restaurant sales | $ | 662,523 | $ | — | $ | — | $ | 13,134 | $ | — | $ | — | $ | 675,657 | ||||||||||||||||||||||||||||||
| Franchise royalties and fees | — | 143,479 | — | 51,943 | — | (4,470) | 190,952 | |||||||||||||||||||||||||||||||||||||
| Commissary revenues | — | — | 1,058,088 | 75,756 | — | (203,900) | 929,944 | |||||||||||||||||||||||||||||||||||||
| Other revenues | — | — | — | 13,713 | 94,306 | (17,493) | 90,526 | |||||||||||||||||||||||||||||||||||||
| Advertising funds revenue | — | — | — | 19,290 | 192,089 | (44,650) | 166,729 | |||||||||||||||||||||||||||||||||||||
| Total Revenues | $ | 662,523 | $ | 143,479 | $ | 1,058,088 | $ | 173,836 | $ | 286,395 | $ | (270,513) | $ | 2,053,808 | ||||||||||||||||||||||||||||||
| Year Ended December 29, 2024 | ||||||||||||||||||||||||||||||||||||||||||||
| Domestic Company-owned restaurants | North America franchising | North America commissaries | International | All Other | Elimination of Intersegment Revenue | Total | ||||||||||||||||||||||||||||||||||||||
| Company-owned restaurant sales | $ | 692,736 | $ | — | $ | — | $ | 31,930 | $ | — | $ | — | $ | 724,666 | ||||||||||||||||||||||||||||||
| Franchise royalties and fees | — | 143,241 | — | 47,941 | — | (4,150) | 187,032 | |||||||||||||||||||||||||||||||||||||
| Commissary revenues | — | — | 1,037,008 | 67,890 | — | (205,234) | 899,664 | |||||||||||||||||||||||||||||||||||||
| Other revenues | — | — | — | 12,701 | 85,914 | (14,933) | 83,682 | |||||||||||||||||||||||||||||||||||||
| Advertising funds revenue | — | — | — | 13,592 | 193,471 | (42,720) | 164,343 | |||||||||||||||||||||||||||||||||||||
| Total Revenues | $ | 692,736 | $ | 143,241 | $ | 1,037,008 | $ | 174,054 | $ | 279,385 | $ | (267,037) | $ | 2,059,387 | ||||||||||||||||||||||||||||||
| Year Ended December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||
| Domestic Company-owned restaurants | North America franchising | North America commissaries | International | All Other | Elimination of Intersegment Revenue | Total | ||||||||||||||||||||||||||||||||||||||
| Company-owned restaurant sales | $ | 726,362 | $ | — | $ | — | $ | 34,463 | $ | — | $ | — | $ | 760,825 | ||||||||||||||||||||||||||||||
| Franchise royalties and fees | — | 148,817 | — | 50,437 | — | (4,267) | 194,987 | |||||||||||||||||||||||||||||||||||||
| Commissary revenues | — | — | 1,062,975 | 72,287 | — | (210,614) | 924,648 | |||||||||||||||||||||||||||||||||||||
| Other revenues | — | — | — | 12,617 | 101,789 | (16,369) | 98,037 | |||||||||||||||||||||||||||||||||||||
| Advertising funds revenue | — | — | — | 12,683 | 194,651 | (50,118) | 157,216 | |||||||||||||||||||||||||||||||||||||
| Total Revenues | $ | 726,362 | $ | 148,817 | $ | 1,062,975 | $ | 182,487 | $ | 296,440 | $ | (281,368) | $ | 2,135,713 | ||||||||||||||||||||||||||||||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 26, 2020 | |
| 2018 | Mar 8, 2019 | |
| 2017 | Feb 27, 2018 | |
| 2016 | Feb 21, 2017 | |
| 2015 | Feb 23, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.