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What you need to know
- Shares of Dave & Buster's sank Wednesday morning after the company reported lower sales and a larger net loss than expected for the third quarter.
- CFO Darin Harper said severe weather and remodeling construction negatively impacted the company's results.
- Restaurant and arcade operator announced also the resignation of Chris Morris as CEO. It said that it had been working in recent months on a plan for succession.
Dave & Buster’s (PLAY) stock started Wednesday morning lower after the company posted a larger loss than expected for the third quarter, and its CEO announced his resignation.
The restaurant-and arcade brand announced $453 million of revenue and a net loss of $32.7 million for the third quarterly quarter after the bell on Tuesday. Visible Alpha’s estimates showed that analysts had predicted revenue of 462.9 million dollars and a net of loss of 16.3 million.
After adjusting for one-time expenses like a $15 million debt refinancing charge, Dave and Buster's $17.5 million adjusted net loss was also larger than the $14.6 million adjusted loss analysts had projected.
The CEO transition has been announced
Darin Harper, Chief Financial Officer of Darin Harper, said that the third quarter was typically the weakest time for the company. “negatively impacted” The severe weather in some parts of the U.S., and construction projects that are slowing down sales elsewhere.
Along with its earnings report, Dave & Buster's also announced Tuesday that CEO Chris Morris has resigned to "pursue other interests." The company said it has been working with a search firm over the "last few months" to identify a successor, and said board chair Kevin Sheehan will serve as interim CEO until the decision is made on a replacement.
Dave & Buster's shares were down 14.7% Wednesday morning to $31.39, putting them just over 40% below where they started the year.
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