Dave & Buster’s Entertainment Shares Collapse on Disappointing Same-store Sales

Shares of Dave & Busters were sinking nearly 10% on Wednesday after the company reported third quarter results.

Despite results beating on both the top and bottom line, it was the company’s same-store sales for the period ended November 4th that had traders concerned.

Dave & Busters reported earnings of 30 cents a share for the third quarter, while analysts expected 24 cents. Revenue at $282 million was also better than the $278 million that analysts expected.

The American restaurant and entertainment business saw its shares tank as Wall Street showed its concerns over weakness in comparable sales. For the quarter, same store sales figures declined 1.3%. Food and beverage same store sales saw declines of 5%.

Dave & Busters cited the weakness in same-store sales to its decision to skip its All You Can Eat Wings promotion during the beginning of the NFL season.

“Food and beverage comp sales were unfavorably impacted by the timing of our All You Can Eat Wings promotion, as well as a decline in special events, which is a higher mix of F&B [food and beverage],” said interim CFO Joseph DeProspero.

For the fiscal year, the company did raise its sales forecast to a range of $1.24 billion to $1.26 billion. This is compared to a previous forecast of $1.23 billion to $1.26 billion for sales. Net income is expected to be in the range of $106 million and $113 million. Previously the forecast was $101 million to $111 million.

Disclaimer: We have no position in Dave & Buster’s Entertainment Inc. (NASDAQ: PLAY) and have not been compensated for this article.