Papa John's International shares were down as much as 17.88% at $24.43.
The stock was set for its worst day since March 2020, if losses hold.
The company cut its annual sales forecast, citing lower volumes and a pressured consumer environment in North America that it expects will continue throughout the year.
It now sees annual global system-wide restaurant sales declining in the range of 2% to 4%, compared with prior expectations of flat to low single digits.
It also said it expects 2026 North America comparable sales to decline between 6% and 8%, versus prior expectations of a 2% to 4% decline.
CEO Todd Penego said on an earnings call: "Looking ahead, we're taking a targeted approach to improving our value proposition rather than engaging in sustained extreme discounting at the national level as we've seen some of our competitors do."
Papa John's, however, beat second-quarter revenue and profit estimates on continued momentum in its international business.
As of the last close, PZZA was down about 23% year to date.
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