Papa John's Blames NFL Flag Flap For Slower Sales

"The NFL has hurt us and, more importantly, by not resolving the current debacle to the [players' and owners'] satisfaction, NFL leadership has hurt Papa John's."

It's not just TV ratings that are being hurt by the NFL's ongoing anthem/kneeling controversy. One of the biggest sponsors for the league says sales are slowing and it has everything to do with players kneeling during the anthem. Papa John's, the official pizza sponsor of the NFL since 2010, released disappointing sales projections for the coming months.

The prediction that some store sales are slowing came even as the company announced better-than-expected year-over-year revenues. But despite past sales, CNBC reports that the company says in the current quarter sales are dropping and the NFL is a big part of the reason according to Papa John's CEO John Schnatter.

"The NFL has been a long and valued partner over the years, but we are certainly disappointed that NFL and its leadership did not resolve the ongoing situation to the satisfaction of all parties," Schnatter said during an earnings call Wednesday. "This should have been nipped in the bud a year and a half ago."

Schnatter said the declining TV viewership and the negative sentiment towards football caused by the kneeling controversy is at the core of his restaurant chain's problems. He called on NFL owners to remedy the situation:

"The NFL has hurt us and, more importantly, by not resolving the current debacle to the [players' and owners'] satisfaction, NFL leadership has hurt Papa John's," Schnatter said. "Leadership starts at the top, and this is an example of poor leadership," he said.  

Sales at existing stores grew just 1% in the current quarter, much lower than the expected growth of 1.4%. The company said it expects the lackluster sales to continue in the upcoming quarter.

Organizations