Gasoline prices hit Domino’s Pizza, Applebee’s restaurant spending

from domino pizza Applebee’s said restaurant chains reported slowing sales in March due to higher gas prices.

The U.S. war with Iran pushed average gasoline prices nationwide to more than $4.50 per gallon, contributing to a new record low in consumer sentiment. As consumers pay more for fuel, they are looking to save money in other areas. A survey of drivers conducted by Numerator found that 43% of respondents have cut back on eating out or takeout since gas prices started rising.

“March and April were softer than January and February, especially as value-conscious consumers stayed home more and ate at lower-cost alternatives,” said John Peyton, CEO of Applebee’s and IHOP. “We attribute that to gasoline prices specifically and the economy more generally.” dining brandhe told CNBC. “We know that when gas prices start to go above $3.50, it’s going to impact those guests.”

If gas prices continue to rise in the coming months, there will be an ongoing risk for some restaurant chains.

To attract budget-conscious consumers, Applebee’s is accelerating its rollout of all-you-can-eat specials. Starting Monday, diners can eat as much shrimp, boneless wings, riblets and fries as they like for $15.99.

Across the restaurant industry, customer traffic fell 2.3% in March from a year earlier, according to Black Box Intelligence. But not all chains felt the same crunch.

chipotle pepper reported unexpected same-store sales growth in the first quarter, despite weaker sales at the end of the reporting period.

“In March, around the beginning of the Iran conflict, our trends softened a little bit,” Chief Financial Officer Adam Reimer said on an earnings call in late April, adding that sales have since accelerated.

on the other hand, shake shack CEO Rob Lynch said the burger chain’s first-quarter sales were relatively stable.

“We haven’t seen any major changes,” he said during Thursday’s earnings call. “We did see some softening in the second half of March, but not at a significant pace.”

and owner of Outback Steakhouse bloomin brand, wendy’s and sweet green All reported a sequential increase in sales in March compared to the first half of the quarter, primarily due to recovery from the winter storm. Still, all three companies saw a decline in traffic in the first three months of this year.

So far, gas price increases have had the biggest impact on spending among low-income consumers, who were already feeling the pressure of higher costs from rent to groceries.

“Obviously, when gas prices go up, and I think that’s the central issue that you’re seeing in the media right now, gas prices and the inflation that goes with it disproportionately impacts low-income consumers.” mcdonalds CEO Chris Kempczinski said on Thursday’s earnings call. “Therefore, we expect the pressure to continue.”

McDonald’s reported same-store sales rose 3.7% in the first quarter, helped by U.S. diners spending more at its restaurants. The fast-food giants lean toward a barbell approach, offering value-added items to cash-strapped consumers and full-price promotions to high-income customers.

Some CEOs see higher gas prices as an opportunity to steal even more market share as the overall restaurant spending pie shrinks.

“We’ve seen our market share accelerate, which clearly means the casual dining industry is shrinking or slowing down,” said Chili Owner CEO Kevin Hockman. blinker internationalsaid in an interview. “It really started with geopolitical events, followed by obviously rising gas prices.”

For several days in late April, Chili’s saw a drop in customers, with customers purchasing fewer alcoholic beverages and skipping appetizers and desserts. Still, Hochman is optimistic that Chili’s will continue to win over customers with its approach to value.

“I think strong players will become even stronger,” he said.

restaurant brand international CEO Josh Kobza agrees.

“Overall, if you look at the first quarter, we didn’t see a continued slowdown in the overall performance (of quick-service restaurants),” Kobza said. “What I find most interesting is the dispersion of results. Some concepts are doing very well, and some are struggling.”

He cited Burger King’s performance in the United States as an example. The RBI-owned burger chain reported a 5.8% increase in domestic same-store sales for the quarter, outpacing same-store sales at rivals McDonald’s and Wendy’s.

Kobza added: “I would say our performance is much more influenced by what we’re doing really great work than it is by the big swings from macro factors that we’ve seen in the past.”