Domino's Pizza Enterprises Ltd shares surged 11.41% during intraday trading on Thursday, as investors reacted positively to the company's reaffirmation of its fiscal 2026 underlying profit guidance.

The rally was fueled by the company's after-market announcement on Wednesday, where it maintained its underlying profit after tax forecast of AU$118 million to AU$122 million. This came despite the company booking approximately AU$300 million in mostly non-cash balance sheet write-downs, including impairments in France and Taiwan, IT asset write-offs, and charges related to the planned closure of up to 60 underperforming stores. Citi analysts noted that the FY26 profit outlook broadly met market expectations, while also highlighting improving franchisee profitability, particularly in Western Australia.

The company also detailed significant cost-saving measures, achieving AU$60 million to AU$70 million in annualized savings through workforce reductions, lower IT expenses, and supplier savings. Additionally, the refinancing of AU$1.05 billion in debt facilities and the assurance that non-cash charges would not impact cash generation or debt covenants further bolstered investor confidence. Citi viewed the impairments and store closures as potentially "clearing the decks" ahead of the new CEO starting on August 5, suggesting a strategic repositioning for future growth.