Dave & Buster's reports Q1 earnings miss as comparable sales slump

Dave & Buster's reports Q1 earnings miss as comparable sales slump Dave & Buster's reports Q1 earnings miss as comparable sales slump Proactive uses images sourced from Shutterstock Proactive Tue, June 16, 2026 at 3:46 PM GMT+2 2 min read PLAY Dave & Buster's Entertainment (NASDAQ:PLAY) reported a steeper-than-expected drop in first-quarter profit and revenue as softer consumer sentiment and a marketing misstep weighed on comparable store sales. The video game and restaurant chain posted adjusted earnings per share of $0. 22 for the quarter, falling well short of the analyst consensus of approximately $0.

90. Revenue declined 1. 5% year-over-year to $559.

2 million, missing the $580. 6 million expected by analysts. Comparable store sales fell 5.

4% in the quarter, significantly worse than the consensus estimate of a 1. 2% decline. The company attributed the shortfall to macroeconomic headwinds including elevated gas prices and geopolitical uncertainty, as well as promotional tests that failed to connect with cost-conscious consumers.

Despite the weak headline results, management pointed to early signs of stabilization. Quarter-to-date comparable sales through mid-June were running at negative 4%, and the company said it expects to return to positive comparable sales for the remainder of fiscal 2026, beginning in mid-June, driven by a new games lineup, World Cup activations and a revitalized loyalty program with personalized offers. The company also cited momentum in its food and beverage segment, where comparable sales rose 5% year-over-year for the ninth consecutive month of positive growth, and in special events, which saw a 3% comparable sales gain.

On the operational side, Dave & Buster's reported a meaningful swing in adjusted free cash flow, improving to positive $25. 3 million from negative $58. 8 million in the prior year period.

Management reiterated its fiscal 2026 target of generating more than $100 million in free cash flow, with approximately $499 million in total liquidity. Dave & Buster's also reported continued international expansion, opening its fifth and sixth franchise locations in May and June 2026, including a partnership to develop 15 venues in India. Jefferies analysts said they view risk/reward as skewed to the upside at current valuations.

The firm noted the stock trades at roughly 4 times estimated 2027 EBITDA, a discount to most full-service peers at 5 to 12 times. The bank lowered its 2026 comparable sales estimate to negative 2. 4% and cut its adjusted EBITDA forecasts for 2026 and 2027 to $433 million and $469 million, respectively.

Shares opened about 2. 6% lower on Tuesday.