Ark Restaurants (ARKR) Q2 2026 earnings summary

Executive summary

• Sales and same-store sales declined across all regions, with Vegas down 11%, Florida down 10%, Washington D.C. down 5%, and New York same-store sales down 12.3% in the quarter; Bryant Park Grill, Café, and Porch leases, which expired in early 2025, accounted for 13.3% of revenue in H1 2026.

• Net loss for Q2 2026 was $(1.8)M or $(0.50) per share, a significant improvement from $(9.3)M or $(2.57) per share in Q2 2025.

• Menu prices remained stable, with only minor increases on select items.

• Legal and lease uncertainty at Bryant Park locations continues to impact business and market perception.

• New America restaurant in Las Vegas is expected to open in early July, anticipated to boost performance.

Financial highlights

• Cash and cash equivalents at quarter-end were $11.5M; total debt was $7.6M; working capital deficit was $2.48M.

• Revenues for the 13 and 26 weeks ended March 28, 2026, decreased 7.9% and 8.7% year-over-year, respectively, primarily due to lower same-store sales and closures.

• Operating loss for the 13 weeks was $1.66M (includes a $566K one-time prepaid rent write-off); adjusted operating loss was $1.09M, down 17.2% year-over-year.

• Adjusted EBITDA for Q2 2026 was $(0.6)M, up from $(0.7)M in Q2 2025, excluding prior year goodwill impairment.

• Company was in compliance with all financial covenants under its credit agreement.

Outlook and guidance

• Management expects sufficient liquidity for at least the next 12 months, but notes that the Bryant Park lease dispute and general economic conditions could adversely affect liquidity.

• Optimism for improved performance with the opening of the new America restaurant in Las Vegas.

• Ongoing lease litigation at Bryant Park locations is expected to continue impacting results until resolved, with possible appeals extending the timeline.

• Meadowlands project dependent on a potential November referendum, with public polling showing majority support, but investment remains highly uncertain and subject to legislative, regulatory, and voter approval.

• Anticipates $4M in capital expenditures for fiscal 2026, mainly for leasehold improvements and renovations.