Papa John’s is out, and Pizza Hut is in, as the “official pizza” of the National Football League, the NFL announced on Wednesday. Pizza Hut is reportedly paying more per year for the sponsorship than Papa John’s did, and its deal lasts through 2021.

Papa John’s announced the news during its fourth-quarter earnings call, on which it also reported a 3.9% drop in US same-store sales and missed expectations on earnings per share, sending the stock down 7% initially.

In a joint statement on Monday night, the NFL and Papa John’s called it a “mutual decision” to end the deal, which still had three years left.

But make no mistake: It is an ignominious moment for Papa John’s, which has had a very bad four months after the face of the company, “Papa” John Schnatter himself, made political comments that damaged the brand.

Papa John’s founder and chairman John Schnatter (R) with JJ Watt (L) and Peyton Manning in a Papa John’s commercial. (via screenshot) More

Timeline of the Papa John’s-NFL breakup

It all started on Nov. 1, on Papa John’s Q3 2017 earnings call. Papa John’s reported disappointing same-store sales results of 1% growth. Schnatter blamed the flat sales on the NFL.

“The NFL has hurt us by not resolving the current debacle to the players’ and owners’ satisfaction,” Schnatter said. “Leadership starts at the top, and this is an example of poor leadership. NFL leadership has hurt Papa John’s shareholders.”

The NFL saw a significant primetime television ratings decline during its regular season, amidst ongoing controversy over players kneeling during the national anthem to protest police brutality. Schnatter’s argument was simple enough: fewer people are watching the NFL, so fewer people are ordering Papa John’s pizza during NFL games. An analyst at Bloomberg Intelligence said the claim was “not a stretch.”

But the comments were still seen as disingenuous—a desperate effort to find someone else to blame—and sparked a backlash. And Schnatter took things beyond business when he said the player protests, “should have been nipped in the bud” by the NFL last season, when Colin Kaepernick first started kneeling.

That comment led many consumers to say they were done with Papa John’s. The web site The Daily Stormer called Papa John’s “the official pizza of the alt-right” and used a photo of a Papa John’s pizza with a swastika made of pepperoni.

The backlash also gave competitors a chance to take advantage—and they took it. DiGiorno took to Twitter to mock Papa John’s motto:

Better Pizza.

Better Sales. — DiGiorno (@DiGiorno) November 1, 2017





And Greg Creed, CEO of Yum Brands, which owns Pizza Hut, Taco Bell, and KFC, was (inevitably) asked on Yum’s earnings call the very next day to comment on Schnatter’s claim. He replied, “We’re not seeing any impact from any of that.”

It didn’t help that some media outlets speculated that the comments were encouraged by Dallas Cowboys owner Jerry Jones, a Papa John’s franchisee and friend of Schnatter’s. Jones, who started a public fight with other team owners over NFL Commissioner Roger Goodell’s contract extension, was not having the best season either.

Exactly two weeks after the earnings call, Papa John’s apologized for its CEO’s comments and walked them back, tweeting that, “The statements made on our earnings call were describing the factors that impact our business and we sincerely apologize to anyone that thought they were divisive. That definitely was not our intention… We believe in the right to protest inequality and support the players’ movement to create a new platform for change. We also believe together, as Americans, we should honor our anthem. There is a way to do both.”

We believe in the right to protest inequality and support the players’ movement to create a new platform for change. We also believe together, as Americans, we should honor our anthem. There is a way to do both. (2/3) — Papa John's Pizza (@PapaJohns) November 15, 2017

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