It has been about a month since the last earnings report for Dave & Buster's (PLAY). Shares have lost about 11.4% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Dave & Buster's due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Dave & Buster's Entertainment, Inc. before we dive into how investors and analysts have reacted as of late.
Dave & Buster's Q4 Earnings & Revenues Miss Estimates
Dave & Buster's reported dismal fourth-quarter fiscal 2025 results, with earnings and revenues missing the Zacks Consensus Estimate. Both metrics also declined on a year-over-year basis.
Dave & Buster’s fourth-quarter fiscal 2025 results were supported by its “back-to-basics” strategy, with improved marketing, targeted promotions and strong food and beverage performance driving better traffic and engagement. Remodeled stores continued to outperform, while sequential improvement in comparable sales trends, along with contributions from new store openings and international franchise expansion, provided incremental support.
However, results were pressured by a decline in comparable store sales, reflecting softer traffic trends, along with weather-related disruptions from Winter Storm Fern. Entertainment revenues also declined, indicating weaker gaming demand. Higher marketing and store operating expenses further weighed on margins, leading to a decline in adjusted EBITDA and a shift to a net loss year over year.
Dave & Buster’s Q4 Earnings & Revenues
For the fiscal fourth quarter, the company reported an adjusted loss per share of 35 cents, missing the Zacks Consensus Estimate of an adjusted earnings per share (EPS) of 39 cents. In the year-ago quarter, it had reported an adjusted EPS of 66 cents.
Quarterly revenues totaled $529.6 million, missing the consensus mark of $557 million by 4.8%. The top line decreased 0.9% from $534.6 million reported in the prior-year quarter.
Food and Beverage revenues (40.9% of total revenues in the reported quarter) increased 8.5% year over year to $216.6 million. Our estimate was $200.7 million.
Entertainment revenues (59.1%) fell 6.6% year over year to $313 million. Our estimate was $354.7 million. The company continues to enhance free cash flow conversion, driven by disciplined capital allocation and tighter control over capital expenditures, including the elimination of low-return and inefficient spending.
Comparable store sales (including Main Event-branded locations) declined 3.3% year over year. Excluding the impact of Winter Storm Fern in January, management estimates that fiscal fourth-quarter comparable store sales would have decreased by approximately 1.5%.
Dave & Buster’s Q4 Operating Highlights
In the fiscal fourth quarter, operating loss amounted to $14 million against operating income of $44.1 million reported in the year-ago quarter. Our estimate for operating income was $35 million.
Adjusted EBITDA in the quarter was $111.4 million compared with $127.2 million in the year-earlier quarter. Our estimate for the metric was $108.5 million. EBITDA margin declined to 21% from 23.8% reported in the prior-year period.
Balance Sheet of PLAY
As of Feb. 3, 2026, cash and cash equivalents were $16.6 million compared with $6.9 million as of Feb. 4, 2025.
At quarter-end, net long-term debt was approximately $1.52 billion compared with $1.48 billion at the end of fiscal 2024. The company maintained available liquidity of $482.9 million, including $466.3 million under its $650.0 million revolving credit facility.
PLAY’s FY25 Highlights
Revenues for 2025 came in at $2.1 billion compared with $2.13 billion reported in 2024.
Adjusted EBITDA in 2025 came in at $436.6 million compared with $506.2 million reported in 2024.
In 2025, adjusted loss came in at 30 cents per share against adjusted EPS of $2.39 reported in the previous year.
Dave & Buster’s Store Development Updates
Dave & Buster’s continues to advance its growth strategy through a combination of new unit expansion, remodel initiatives and international franchising. In the fiscal fourth quarter, the company opened two new domestic Dave & Buster's stores. This brought the total domestic openings for fiscal 2025 to 11 (plus one relocation), consisting of eight Dave & Buster’s and three Main Event locations.
The company is also making steady progress on its remodel program, completing 16 store remodels during the year and bringing the total number of recently refreshed Dave & Buster’s locations to 51 since the initiative began in the second half of fiscal 2023.
On the international front, Dave & Buster’s expanded its footprint by opening three franchise locations in fiscal 2025, bringing the total to four units globally. The fourth location, which opened recently, is in the Dominican Republic. Looking ahead, three additional international locations are expected to open in the near future in Delhi, India; Perth, Australia; and Mexico City, Mexico.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -46.85% due to these changes.
VGM Scores
At this time, Dave & Buster's has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock has a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Dave & Buster's has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Dave & Buster's belongs to the Zacks Retail - Restaurants industry. Another stock from the same industry, Darden Restaurants (DRI), has gained 1.7% over the past month. More than a month has passed since the company reported results for the quarter ended February 2026.
Darden Restaurants reported revenues of $3.35 billion in the last reported quarter, representing a year-over-year change of +5.9%. EPS of $2.95 for the same period compares with $2.80 a year ago.
For the current quarter, Darden Restaurants is expected to post earnings of $3.64 per share, indicating a change of +22.2% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
Darden Restaurants has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
