Dave & Buster's Entertainment (PLAY) investor relations material

Executive summary

• Third quarter revenue was $448.2 million, down 1.1% year-over-year, with comparable store sales declining 4.0% due to reduced walk-in business.

• Net loss for the quarter was $42.1 million ($1.22 per diluted share), compared to $32.7 million ($0.84 per diluted share) last year.

• Adjusted net loss was $39.4 million ($1.14 per diluted share), versus $17.5 million ($0.45 per diluted share) last year.

• Adjusted EBITDA was $59.4 million, down 13% from the prior year.

• The company opened nine new stores and relocated one during the nine-month period, operating 241 stores at period end.

Financial highlights

• Entertainment revenues were $279.4 million (62.3% of total), food and beverage revenues were $168.8 million (37.7%).

• Cost of products as a percentage of total revenues decreased to 14.2% from 15.0% year-over-year.

• Operating payroll and benefits increased to $124.9 million (27.9% of revenues), mainly due to wage increases at new stores.

• Operating loss was $16.2 million, compared to operating income of $6.3 million in Q3 2024.

• Interest expense rose to $40.2 million from $32.9 million year-over-year, mainly due to sale-leaseback transactions.

Outlook and guidance

• Sequential improvement in same-store sales each month of Q3, with the final month down only about 1% year-over-year and further improvement in November.

• Two additional domestic stores expected to open in Q4, totaling 11 new stores and one relocation for fiscal 2025.

• At least four more international franchise stores planned over the next six months.

• Management expects continued variability in store performance and seasonality, with new store openings contributing to fluctuations in quarterly results.

• Cash and cash equivalents, combined with expected cash flows and available borrowings, are expected to be sufficient for operating and capital needs for at least the next twelve months.