Dave & Buster's (PLAY) Q2 Earnings: What To Expect

Arcade company Dave & Buster’s (NASDAQ:PLAY) will be reporting results tomorrow after market hours. Here’s what investors should know.

Dave & Buster's missed analysts’ revenue expectations by 4.5% last quarter, reporting revenues of $588.1 million, down 1.5% year on year. It was a weak quarter for the company, with a miss of analysts’ earnings estimates.

Is Dave & Buster's a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Dave & Buster’s revenue to grow 3.4% year on year to $560.6 million, slowing from the 15.7% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.86 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Dave & Buster's has missed Wall Street’s revenue estimates five times over the last two years.

Looking at Dave & Buster’s peers in the leisure facilities segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Life Time delivered year-on-year revenue growth of 18.9%, beating analysts’ expectations by 5.2%, and Sphere Entertainment reported revenues up 112%, in line with consensus estimates. Life Time traded up 7.5% following the results while Sphere Entertainment was also up 13.5%.

Read our full analysis of Life Time’s results here and Sphere Entertainment’s results here.

There has been positive sentiment among investors in the leisure facilities segment, with share prices up 4.1% on average over the last month. Dave & Buster’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $56.6 (compared to the current share price of $30.76).

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