PLAY — Dave & Buster's Entertainment, Inc.

Summary of Dave & Buster's Q4 2026 Earnings Call

1. Key Financial Results and Metrics

• Total Revenue: $530 million for Q4 2026.
• Net Loss: $40 million ($1.15 per diluted share); adjusted net loss of $12 million ($0.35 per diluted share).
• Adjusted EBITDA: $111 million, with a margin of 21%.
• Comparable Store Sales: Decreased 3.3% year-over-year; adjusted for winter storm impact, the decline was estimated at 1.5%.
• Food & Beverage Same-Store Sales: Increased approximately 7% in Q4.
• Free Cash Flow Guidance: Expected to exceed $100 million for FY 2026.
• Capital Expenditures: Planned CapEx for FY 2026 capped at $200 million.

2. Strategic Updates and Business Highlights

• Back to Basics Strategy: Continued focus on improving same-store sales, enhancing guest experience, and optimizing marketing and promotions.
• Marketing Initiatives: A revamped marketing strategy leveraging data for targeted campaigns, including successful promotions like half-price games and the Eat & Play Combo.
• New Game Launches: Introduction of at least 10 new games in FY 2026, including titles associated with popular IPs such as "Stranger Things" and "John Wick."
• Operational Improvements: Enhanced training programs and operational processes aimed at improving guest satisfaction and service speed.
• Remodel Program: Successful remodels have shown to outperform non-remodeled stores by approximately 700 basis points.

3. Forward Guidance and Outlook

• Same-Store Sales Growth: Management is confident in achieving positive comps in FY 2026, driven by strategic initiatives and new game offerings.
• Revenue and EBITDA Growth: Anticipated growth in both metrics for FY 2026, supported by improved operational execution and marketing strategies.
• International Expansion: Plans to open additional international franchise locations, contributing to brand growth with minimal risk.

4. Bad News, Challenges, or Points of Concern

• Declining Metrics: Despite improvements, Q4 saw a 3.3% decline in same-store sales, with challenges attributed to external factors like winter storms and macroeconomic pressures.
• Increased Costs: Higher marketing costs and deferred revenue headwinds impacted EBITDA margins.
• Consumer Behavior Uncertainty: Concerns regarding macroeconomic factors such as gas prices and consumer sentiment, which could affect future performance.
• Amusement Business Pressure: The amusement segment remains under pressure, with management acknowledging past mistakes in game investment.

5. Notable Q&A Insights

• Consumer Behavior: Management noted the difficulty in parsing macroeconomic impacts on sales due to shifting holiday calendars and consumer sentiment.
• Promotional Strategy: The half-price games promotion was successful in driving traffic and spend, and management indicated plans to reintroduce similar promotions.
• Game Quality and Innovation: Management expressed confidence in the new game lineup, emphasizing that they are designed to enhance guest experience and drive traffic.
• Capital Allocation: Management reassured investors about disciplined capital expenditure and the focus on high-return investments, balancing new store growth with core business performance.

Overall, Dave & Buster's is navigating a challenging environment while implementing strategic initiatives aimed at revitalizing the brand and improving financial performance. The management team remains optimistic about future growth prospects, particularly through enhanced guest experiences and operational efficiencies.