Dave & Buster’s Entertainment Inc. will launch the next evolution of its menu in August, focusing primarily on beverages and special events, and is using food promotions to stimulate off-peak demand, executives said Wednesday.
Coppell, Texas-based Dave & Buster’s, which also owns the Main Event brand, released its first quarter earnings for the period ended May 5, and executives shared a strategy update after the release.
While the company like others in the foodservice space this year said lower-income consumers, especially those with household incomes of $75,000 or less, were exhibiting notable pressure, the brands were focused on providing marketing behind games and food.
“We are launching the next evolution of our new menu in August, which is primarily focusing on beverage innovation and our special-event menu,” said Chris Morris, Dave & Buster’s CEO, on the call. “We will continue to refine and improve the operating model to drive attachment and guest satisfaction scores, which continue to be at historical highs.”
Morris said Dave & Buster’s, under revised marketing leadership, was promoting half-off-food initiations “to stimulate some demand off-peak Monday through Thursday.” The company was also promoting all-you-can-eat wings on Mondays and Thursdays, he said.
“What you're going to continue to see from us is just going through the testing and learning process, fine-tuning the process, and then being very targeted in how we approach the business,” Morris said.
“I would say based on the success that we've seen in the midweek, that's something we're going to continue to focus on,” he said. “We're still running half-off food right now. That's not going to be an evergreen marketing approach whatsoever, but, for the near-term, we're going to continue to run with that.”
He also said Dave & Buster’s was pleased with half-off games prices on Wednesdays.
“We really like the approach that we're taking to driving off-peak demand,” he said.
Michael Quartieri, Dave & Buster’s chief financial officer who announced his impending retirement in December, said the beginning of the calendar year started off slow.
“As we got into January-February, we kept still seeing that lower-income, that $75,000 and below, customer still being challenged,” Quartieri said. “That's not news to anybody.”
Sales in that period from January, February into March were choppy, he added. After spring break for schools, into April and May, Quartieri said, “We've seen considerable improvement in the traffic numbers. The promotions of half-off food have helped.”
Quartieri said: “At this point in time, we're seeing that low single-digit negative comp right now. But we do see that trend getting better as we get more into the summer months at this point.”
For the first quarter ended May 5, Dave & Buster’s net income was $41.4 million, or 99 cents a share, down from $70.1 million, or $1.45 a share, in the same period last year. Revenue was $588.1 million, a decline of 1.5% from $597.3 million in the prior-year quarter.
Same-store sales were down 5.6% versus the comparable 13 weeks of 2023.
The company opened three new Dave & Buster's stores and one new Main Event unit in the first quarter.
Dave & Buster's Entertainment, founded in 1982, owns and 224 venues in North America. The company has 165 Dave & Buster’s branded stores in 42 states, Puerto Rico, and Canada. It also operates 59 Main Event branded stores in 20 states.
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