U.S. consumer plays in China are more than coffee and iPhones. Stocks to watch

Starbucks and Apple are facing challenges in China, but other U.S. consumer brands like Domino’s Pizza are experiencing growth. Despite the pandemic, Domino’s Pizza’s operator in China, DPC Dash, reported its 26th consecutive quarter of same-store sales growth. Revenue in 2020 tripled compared to 2019, with net losses decreasing significantly. HSBC analysts predict the company will turn a net profit in 2025, citing growth from new markets as a driving factor.
Chinese President Xi Jinping recently met with U.S. executives to encourage foreign investment in China. While there are tensions in advanced tech, both countries are seeking cooperation in areas like climate and tourism. The vast consumer market in China remains attractive to many businesses.
Domino’s has a 14% stake in DPC Dash, which opened its 800th store in China in January. Papa John’s is also expanding in China, with international revenue growing by 21% last year. Smaller Chinese cities are also embracing pizza, with new Domino’s stores seeing success in various locations across the country.
DPC Dash CEO Aileen Wang highlighted the company’s success and minimal marketing expenses in attracting customers to new stores. Despite a slight decrease in average sales value per order in Shanghai and Beijing, DPC Dash remains optimistic about gaining market share and expanding into new growth markets.
The acceptance of Western food, including pizza, is increasing in China as income levels rise. Yum China, which owns Pizza Hut, and McDonald’s are also making significant investments in their operations in China. Despite challenges in the consumer market, these companies are optimistic about continued growth and success in China.

As Starbucks faces price competition in China and Apple opens a new store in Shanghai, other U.S. consumer brands are thriving in the Chinese market. Domino’s Pizza’s China operator, DPC Dash, reported significant growth in revenue and a decrease in net losses. The company expects to turn a net profit in 2025 and plans to continue expanding into new markets. Papa John’s also saw growth in China, with international revenue increasing by 21% last year. Pizza is becoming popular in smaller Chinese cities, with new Domino’s stores ranking high in global sales. Despite cautiousness in the catering sector, both DPC Dash and Papa John’s are optimistic about gaining market share and enjoying rapid growth. The acceptance of Western food in China is increasing as income levels rise, making it a promising market for U.S. consumer brands. McDonald’s is also expanding its presence in China, with plans to double its store count by the end of 2028.Overall, U.S. consumer brands are optimistic about the Chinese market and anticipate continued growth and success in the coming years.

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