Dave & Buster's Entertainment (NASDAQ:PLAY), the gaming and dining operator, reported weaker second-quarter earnings, swinging to a $12.5 million net loss as revenue fell and same-store sales declines eased.
Revenue fell to $544.1 million from $557.4 million a year earlier, when the company posted $11.4 million in earnings.
Adjusted earnings before interest, taxes, depreciation and amortization fell to $98.9 million from $129.7 million.
Same-store sales declined 2.9%, compared with 5.4% in the first quarter. Interim CFO Cory Hatton said July's decline narrowed to 1.6% from 5% in June.
The company said sales trends improved further early in the third quarter, although CEO Darin Harper acknowledged difficult consumer conditions.
Harper said food-and-beverage same-store sales rose 7.6%. He credited a return to a proven menu, better execution of the Eat & Play Combo and more gaming customers buying food and drinks.
The company also plans consistent price increases to account for inflation.
Adjusted free cash flow was positive $19.5 million through the second quarter, compared with negative $36.5 million a year earlier.
CFO Hatton identified $15 million in savings expected over the next 12 months, primarily from areas that should not affect the guest experience, including general and administrative overhead, technology systems, insurance and vendors.
Management sees a path to at least double that amount in additional savings.
Net capital spending remains on pace to stay below $200 million in the 2026 financial year. Harper said spending could fall to about $150 million or less in 2027, depending on investment opportunities.
