Dave & Buster’s Q1 report came out yesterday, and to say that it was disappointing would be an understatement. Shares floundered on the news, with PLAY stock currently down more than 20% twenty-four hours later.
Here’s what we know.
PLAY Stock Goes For a Slide
On Tuesday, June 11, Dave & Buster’s Entertainment (NASDAQ:PLAY), a restaurant and arcade chain, released its fiscal Q1 results. There were some major expectations for this report in terms of revenue figures and same-store sales—and the Dallas, Texas company missed on both.
According to Dave & Buster’s Q1 report, revenue came in at $363.6 million, growing 9.5%. For perspective, The Street was expecting the company to report revenue of $371 million. As for same-store sales, figures declined drastically (0.3%).
Meanwhile, Dave & Buster’s also slashed its fiscal 2020 guidance, with revenue now forecasted to fall between the $1.365 billion to $1.39 billion range. Again, for perspective, analysts are expecting $1.4 billion in revenue.
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“Comparable store sales were below expectations largely due to the Easter shift, which proved unfavourable this year,” explained CEO Brian Jenkins.
Mr. Jenkins went on to provide optimistic comments, though—“We are fully committed to executing on our four strategic priorities to strengthen the brand”—but that didn’t do much for market confidence.
According to Yahoo Finance, as of 12:36 PM EDT, PLAY stock is trading at $40.25 on the Nasdaq, which means it is down 21.89%. Before the opening bell Wednesday, shares dropped around 17% to $42.50.
Positives on the Horizon?
It’s possible David & Buster’s Entertainment could experience a comeback. With its four strategic priorities and its plans to open around 15 new stores and create shareholder value over the long-term, good things could be on the horizon for the company. Or maybe not. If same-store sales dropped in Q1, what will they be like at the 15 to 16 new stores?
Let us know what you think in the comments below! Don’t forget to see where PLAY stock ends the trading week as well.
Featured Image: PixaBay
