Lucky Strike Entertainment (LUCK) Q1 2025 earnings summary

Executive summary

• Total location revenue increased 17.5% year-over-year to $260.2 million, with strong growth in food and beverage sales and robust cash flow conversion.

• Adjusted EBITDA rose 21% to $62.9 million, with margin expanding to 24.2% in a seasonally slow quarter.

• Net income increased 27% to $23.1 million, with net income margin improving to 8.9%.

• Recent acquisitions, including Raging Waves, Boomers, and Spectrum, are expected to provide significant upside through operational improvements and capital investment.

• New builds and rebranding efforts, such as Lucky Strike locations, are outperforming expectations and expanding the company’s footprint.

Financial highlights

• Q1 2025 revenue ex service fee was $260 million, up from $226 million year-over-year.

• Adjusted EBITDA reached $62.9 million, a 21% increase from $52.1 million last year, with margin expanding to 24.2%.

• Net income for Q1 2025 was $23.1 million, up from $18.2 million in Q1 2024.

• Food and beverage sales rose 18% year-over-year to $88.0 million, with F&B to bowling spend at $0.80, up from $0.60 last year.

• Cash provided by operating activities increased 83% to $29.4 million.

Outlook and guidance

• FY 2025 revenue guidance raised to $1.23–$1.28 billion, with midpoint at $1,250 million, reflecting continued double-digit annual growth.

• Adjusted EBITDA margin expected at 32%–34%, or $390–$430 million.

• Robust new build pipeline with two new Lucky Strike locations opened and more planned.

• Management anticipates increased acquisition activity and is prioritizing liquidity to capitalize on these opportunities.

• Margin expansion anticipated to be greatest in Q3, aided by event timing and easier weather comps.