Dave & Buster's Entertainment (PLAY) Q1 2026 earnings summary

Executive summary

• First quarter revenue was $568 million, a 3.5% decrease year-over-year, with comparable store sales down 8.3% and net income at $22 million ($0.62 per diluted share).

• Adjusted EBITDA was $136 million (24% margin), down 14.5% from the prior year, reflecting lower sales and higher operating expenses.

• Leadership and board remain confident in recovery, citing sequential improvement in sales trends through Q1 and into Q2, with positive same-store sales in 11 of the last 30 days.

• New initiatives include rebalanced media spend, Eat-and-Play Combo, Summer Pass, and a robust store manager incentive plan, with 48 remodels nearly complete and remodeled stores outperforming the system by over 700 basis points.

• Opened two new stores, relocated one, and completed 13 remodels in Q1; two more stores opened after quarter-end, and the first international franchise opened in India.

Financial highlights

• Q1 comp store sales decreased 8.3% year-over-year; February comps down 11.9%, March down 8.4%, April down 4.3%.

• Revenue for Q1 was $568 million; net income $22 million ($0.62 per diluted share); adjusted net income $27 million ($0.76 per diluted share); adjusted EBITDA $136 million (24% margin).

• Operating income was $63.2 million (11.1% of revenue), down from $85.5 million (14.5%) year-over-year.

• Operating cash flow was $96 million in Q1; ended quarter with $12 million in cash and $411 million available under credit facility.

• Capital expenditures rose to $154.6 million, with $115 million in gross capital additions in Q1: $53M new stores, $20M remodels/initiatives, $30M games, $12.5M maintenance.

Outlook and guidance

• Sequential improvement in comps through first five weeks of Q2, down 2.2% versus prior year.

• Fiscal 2025 guidance: capital expenditures not to exceed $220 million, pre-opening expense of ~$20 million, and interest expense of $130–$140 million.

• Plan to open 10–12 new stores in fiscal 2025; nine owned real estate assets at various development stages.

• Liquidity is expected to be sufficient for operating requirements and capital allocation strategy over the next twelve months.

• Leadership expects continued improvement in revenue, adjusted EBITDA, and free cash flow.