LUCK

Entertainment venue operator Lucky Strike (NYSE:LUCK) fell short of the market’s revenue expectations in Q2 CY2026, with sales flat year on year at $303.9 million. On the other hand, the company’s outlook for the full year was close to analysts’ estimates with revenue guided to $1.30 billion at the midpoint. Its GAAP loss of $0.22 per share was significantly below analysts’ consensus estimates. Is now the time to buy LUCK? Find out in our full research report (it’s free). Revenue: $303.9 million vs analyst estimates of $310.5 million (flat year on year, 2.1% miss) Adjusted EBITDA: $74.07 million vs analyst estimates of $86.61 million (24.4% margin, 14.5% miss) EBITDA guidance for the upcoming financial year 2027 is $350 million at the midpoint, below analyst estimates of $377.3 million Operating Margin: 3.2%, down from 5% in the same quarter last year Same-Store Sales fell 2.5% year on year (-3.5% in the same quarter last year) Lucky Strike’s Q2 results were met with a significant negative market reaction, as the company missed Wall Street’s revenue and adjusted EBITDA expectations for the quarter. Management attributed the flat sales and margin pressure primarily to unique external events, including the World Cup and NBA Finals, which drove a pronounced drop in customer traffic during key weeks. CEO Thomas Shannon emphasized, “For five straight weeks, millions of consumers who would ordinarily be bowling on a Friday or Saturday night were watching sports from home.” The company also noted weather-related challenges, particularly for its water park business, and acknowledged that marketing spend did not deliver the intended return on investment. Looking forward, Lucky Strike’s guidance reflects a cautious approach as management expects some tailwinds from the absence of last summer’s one-off disruptions but remains wary of macro uncertainty and weather volatility. Investments in technology, targeted marketing, and operational improvements are expected to drive margin expansion over time. CFO Robert Lavan described 2027 as “an investment year,” explaining that marketing, system upgrades, and ramping up newly acquired water parks would weigh on margins but should position the company for future gains. While the company anticipates a rebound in event bookings and continued progress in labor and cost efficiency, management is not assuming a material improvement in California or factoring in unpredictable weather patterns. Management identified major sports events, weather challenges, and uneven marketing ROI as the main factors shaping this quarter’s performance, while recent operational changes and portfolio adjustments are expected to have a growing impact. Sports programming impact: The World Cup and NBA Finals led to a sharp decline in in-venue traffic during June and early July, as millions of potential customers opted to watch major broadcasts at home. Management estimated this unique five-week period pulled an otherwise positive quarter slightly negative, describing it as a one-time disruption unlikely to recur next year. Water parks weather exposure: Weather was a key factor impacting water park attendance and profitability, especially at Raging Waves outside Chicago, which experienced a colder and wetter June than normal. Management stressed that pricing and cost discipline helped offset some of the attendance shortfall, but emphasized that weather volatility is a persistent risk for this segment. Event business restructuring: Lucky Strike undertook a full restructure of its events business, introducing a hybrid sales model and centralized call center support for smaller parties. Management is optimistic this will help recapture the $40 million in lost event revenue over the past three years, with early signs of improved bookings heading into the key holiday period. Marketing spend challenges: The company doubled its marketing budget, increasing impressions significantly, but admitted that creative content did not generate the intended increase in customer intent. Management now plans to focus on more targeted, measurable marketing investments with higher return thresholds, especially as digital engagement becomes more central to its strategy. Operational and portfolio optimization: Significant efforts were made to reduce capital expenditures and improve labor efficiency across venues. The company is nearing completion of major rebranding initiatives and expects to shed underperforming locations, particularly those acquired during recent M&A activity, to streamline operations and improve leverage. Management expects the absence of last year’s one-off disruptions, combined with operational improvements and targeted investments, to drive a moderate rebound in sales and profitability, though weather and macroeconomic uncertainty remain key variables. Event business recovery: The December quarter is expected to be a pivotal period, as management cited a sharp rebound in event bookings compared to last year. The newly restructured events platform is tracking $10 million ahead of prior-year backlog, and leadership sees this as a proof point for broader execution on strategic initiatives. Marketing and digital strategy: Lucky Strike plans to further refine its approach to marketing, emphasizing targeted digital campaigns and higher ROI content. The introduction of a new customer relationship management (CRM) system—described as the company’s largest-ever IT project—is intended to enhance data-driven decision making and improve customer conversion rates. Portfolio rationalization and cost discipline: A focus on shedding underperforming venues and maintaining disciplined capital spending is expected to support free cash flow and deleveraging efforts. Management projects lower capital expenditures and identified asset sales as a lever to further strengthen the balance sheet, while also completing major brand consolidation initiatives. Looking ahead, the StockStory team will closely watch (1) the pace and durability of event business recovery—particularly in the critical December quarter, (2) execution on digital marketing and CRM system deployment to drive customer engagement, and (3) the impact of ongoing portfolio rationalization and cost efficiency initiatives on margins and free cash flow. Weather trends and consumer demand in California will also be important areas of focus. Lucky Strike currently trades at $6.26, down from $6.77 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. 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Lucky Strike’s Q2 results were met with a significant negative market reaction, as the company missed Wall Street’s revenue and adjusted EBITDA expectations for the quarter. Management attributed the flat sales and margin pressure primarily to unique external events, including the World Cup and NBA Finals, which drove a pronounced drop in customer traffic during key weeks. CEO Thomas Shannon emphasized, “For five straight weeks, millions of consumers who would ordinarily be bowling on a Friday or Saturday night were watching sports from home.” The company also noted weather-related challenges, particularly for its water park business, and acknowledged that marketing spend did not deliver the intended return on investment. Is now the time to buy LUCK? Find out in our full research report (it’s free). Revenue: $303.9 million vs analyst estimates of $310.5 million (flat year on year, 2.1% miss) Adjusted EBITDA: $74.07 million vs analyst estimates of $86.61 million (24.4% margin, 14.5% miss) EBITDA guidance for the upcoming financial year 2027 is $350 million at the midpoint, below analyst estimates of $377.3 million Operating Margin: 3.2%, down from 5% in the same quarter last year Market Capitalization: $858.9 million While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Steven Wieczynski (Stifel) asked about the gap between margin guidance and the company’s long-term target. CFO Robert Lavan said higher marketing and systems investments are weighing on margins, but the long-term 30% target remains achievable with scale. Eric Handler (ROTH Capital) inquired about progress in restructuring the events business. Lavan described a shift to a hybrid sales model with centralized support, reporting early signs of increased multi-location bookings and improved outbound sales focus. Randal Konik (Jefferies) asked for details on capital expenditure trends and future asset sales. CEO Thomas Shannon said CapEx will continue to decline as rebranding projects finish, and underperforming venues will be sold to reduce leverage. Eric Wold (Texas Capital Securities) questioned labor efficiency moves, especially in bowling centers versus water parks. Lavan explained $1 million monthly savings in bowling labor, with ongoing optimization expected across other venue types. Michael Kupinski (NOBLE Capital Markets) sought quantification of water park EBITDA contribution and events recovery. Lavan projected $28–$33 million EBITDA from water parks next year and highlighted that events could recapture $40 million in lost revenue if current trends persist. Looking ahead, the StockStory team will closely watch (1) the pace and durability of event business recovery—particularly in the critical December quarter, (2) execution on digital marketing and CRM system deployment to drive customer engagement, and (3) the impact of ongoing portfolio rationalization and cost efficiency initiatives on margins and free cash flow. Weather trends and consumer demand in California will also be important areas of focus. Lucky Strike currently trades at $6.56, down from $6.74 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free for active Edge members). ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies. Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Thursday, Aug. 27, 2026 at 9:00 a.m. ET President and Chief Financial Officer - Robert Lavan Founder and Chief Executive - Thomas Shannon Operator: Hello, everyone. Thank you for joining us, and welcome to the Lucky Strike Entertainment Q4 2026 Earnings Conference Call. [Operator Instructions] I will now hand the conference over to Bobby Lavan, Chief Financial Officer. Bobby, please go ahead. Robert Lavan: Good morning to everyone on the call. This is Bobby Lavan, Lucky Strike's President and Chief Financial Officer. Welcome to our conference call to discuss Lucky Strike's fourth quarter 2026 earnings. Today, we issued a press release announcing our financial results for the period ending June 29, 2026. A copy of the press release is available in the Investor Relations section of our website. Joining me on the call today is Thomas Shannon, our Founder and Chief Executive. I would like to remind you that during today's conference call, we may make certain forward-looking statements about the company's performance. Such forward-looking statements are not guarantees of future performance, and therefore, one should not place undue reliance on them. Forward-looking statements are also subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed. For additional information concerning factors that could cause actual results to differ from those discussed in our forward-looking statements, you should refer to the cautionary statements contained in our press release as well as the risk factors contained in the company's filings with the SEC. Lucky Strike Entertainment undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances that occur after today's call. Also during today's call, the company may discuss certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measures most directly comparable to each non-GAAP financial measure discussed and the reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure can be found on the company's website. I will now turn the call over to Tom. Thomas Shannon: Thanks, everyone, for joining today's call. Despite a weak consumer at the lower end of the K and general macro uncertainty, we finished fiscal 2026 with a same-store sales comp of minus 0.2%, a 3.5-point improvement over the prior year and our best comp performance since fiscal 2023. Total revenue grew 4% to $1.245 billion, and adjusted EBITDA was $333 million, reflecting a year of deliberate investment in marketing in our water park platform and in the technology and leadership that position us for fiscal 2027. Had it not been for the World Cup and its record-breaking viewership and the conflict in the Middle East that drove consumer confidence to its lowest level in 70 years, our full year comp would almost certainly have been positive. There are green shoots across the business, and they are broadening. Ex-California, the company comped up plus 0.9% for the year. Retail bowling and shoe revenue comped plus 2.9%. Leagues grew plus 3.6% and accelerated in each of the last 4 months. Food comped plus 8%, and events, one of our most important product lines, turned positive in May and June for the first time since 2024 and remained positive in July and August, its best stretch in years. The fourth quarter started well. April was roughly flat, May swung to plus 2%, and we entered June with strong momentum. That momentum was disrupted by an extraordinary stretch of at-home sports viewership. On June 11, the most watched World Cup in American television history kicked off on home soil for the first time in a generation. The July 19 World Cup final drew roughly 66 million viewers across platforms, the largest American television audience since the Super Bowl. Layered on top of that, the Knicks won their first NBA title in 53 years in the most watched finals in 28 years, averaging more than 20 million viewers a night in our largest market with 33 million people watching the final game. For 5 straight weeks, millions of consumers who would ordinarily be bowling on a Friday or Saturday night were watching sports from home. June comped minus 7% and pulled an otherwise positive quarter and year slightly into the negative. I want to be precise about what that was and what it was not. It was not a weakening consumer. As we have seen through every exogenous shock since I started this company, the consumer has a short memory and adjusts to new realities quickly. And that is exactly what happened here. Our trends inflected the week after the final, and August is rebounding. It was a onetime 5-week programming event on home soil, and it does not repeat next summer. California remains our weakest market, but it is trending better. We made meaningful upgrades to the operating team there, including replacing leadership, and we are overhauling our corporate sales organization in the state. As I outlined on our last call, the full earnings benefit of the cost actions we took beginning in mid-January would land in the fourth quarter, and that is exactly what happened. The second quarter's $6 million payroll overrun became a payroll tailwind in the fourth quarter and remained one in July. We made significant advancements this year in analytics, pricing, leagues and capital efficiency. And with AI, our data and insights into the business are accelerating and our ability to optimize key functions like labor management. We reduced capital expenditures by 19% to $114 million from $141 million last year and $194 million 2 years ago. This is a reduction of $80 million in 2 years. On marketing, not all of our spending delivered the ROI we expected. We doubled working media and gained significant awareness, but the creative did not generate enough intent. Going forward, our investments will be more targeted, more measurable and held to a higher return threshold. In fiscal 2027, every marketing dollar needs to generate a return. Otherwise, we will consider reducing marketing as a percentage of revenue. Water parks represented the largest operational change of our summer. A year ago, we directly managed 2 water parks. This summer, we directly managed 5, including Raging Waters Los Angeles, which we closed on in January for $45 million. We are in 5 really good markets with very strong positions, the largest water parks in North Carolina, Illinois and California and 2 very good parks in the Florida Panhandle. That is a step change in operating complexity, and the organization rose to it. Strategically, the season was about striking the right balance between price, attendance and labor. Across the water park portfolio, per capita spending is up double digits and payroll was down mid-single digits as we staffed to demand. Price and cost discipline held what weather took and it is the same pattern the large regional park operators described in their calls this month, attendance pressured by weather, per capita spending up and the economics protected through revenue management. The weather impact was real and concentrated. Raging Waves, our 54-acre water park outside Chicago, saw attendance fall significantly against the June that ran cooler than normal with rainfall well above normal. As I've said before, in this business, pricing has a lot less to do with demand than weather, and a water park cannot comp through a cold, wet summer month. We remain very bullish here. I've described the water parks as a coiled spring. On a trailing 12-month basis through July, the water parks produced $56 million of revenue and $22 million of EBITDA, up from $23 million of revenue and $11 million of EBITDA in fiscal 2025. Roughly 80% of summer water park earnings land in our September quarter, which is in fiscal 2027. The business is highly countercyclical and will only get better as we become more experienced operators in this business. The fixes for next season are simple: sell season passes earlier to hedge out weather and further optimize price and admissions. We are very happy with our Boomers Parks, which are counterseasonal, high margin and EBITDA positive in every period, delivering $11 million of EBITDA this year, nearly double the prior year. Turning to guidance. For fiscal 2027, we expect adjusted EBITDA of $340 million to $360 million. We run a short-cycle business, and we do not give guidance blindly or optimistically. So we are deliberately guiding conservatively as we work through the year. Importantly, this range reflects prudence around the environment, not the trajectory of our plan. The consumer has already told us in August that they want what we sell, and the keys to this year will be events booking for December and a clean second half after more disturbances than we have ever seen historically. Thank you. With that, let's turn it over to Q&A. Operator: [Operator Instructions] Your first question comes from the line of Steven Wieczynski from Stifel. Steven Wieczynski: So Tom or Bobby, I mean if we think about your guidance for this year, if we kind of look at where the assumptions around margins, I mean you guys are kind of forecasting margins somewhere, I think it's a 27% number versus the 30% long-term target you laid out in the presentation. So as we think about fiscal year '27, wondering what might be weighing a little bit there on that margin versus your long-term goal. And I know you kind of called out maybe some marketing initiatives and some other things in there as well. But any kind of color around the margin target for this year versus the long-term target would be helpful. Robert Lavan: Yes. So we've spent a lot of time on this topic. And we added a slide to our investor deck that will show you that $900 million of revenue in the portfolio runs at a 42% 4-wall EBITDA margin, and all of that's the pre-2022 properties. And then there is $300 million that runs at 30%, and that's everything that we've invested in, built or acquired over post-COVID. And when you look at the math there, when we get that $300 million up, you get back to the 30%. I think the 32% is a little bit harder to achieve in a world where we've taken marketing from 1% to 2.5% to 3% of revenue. I mean that's just an automatic reduction in margin. But we're still very confident in the long-term 30% to 32%. We just want to be prudent with our guide this year as we invest in marketing, as we invest in systems, as we continue to ramp the water parks and making sure that the organizational structure is there. But ultimately, this continues to be an investment year, but we're pretty happy with the trajectory we're on. Steven Wieczynski: Okay. Got you. And then Bobby, probably one for you as well. Wondering maybe how we should think about cadence same-store sales cadence for the -- for fiscal year '27. Your commentary, I think Tom's commentary around July and August were positive. That sounds good. So it sounds like the first quarter should be positive just based on maybe how September ends up. But any color around the last 3 quarters of the year in terms of how you guys are maybe -- I know it's tough to kind of forecast that, but what you guys are kind of thinking from a same-store sales perspective? And then maybe anything from a headwinds or tailwinds for the last 3 quarters of the year as well that we should be thinking about? Robert Lavan: Yes. So moving backwards, June was the worst month I've ever seen here. And so that is going to be a tailwind next year. We're not going to have the World Cup. And hopefully, the weather in Chicago is better. So June has some tailwinds -- last year, we had about $10 million of revenue hit from 2 different distinct snowstorms in the March quarter. And the weather is the weather, but ultimately, those were very unique. The quarter that I'm most focused on is our December quarter. We have completely restructured our events platform. Events, as we talked about a lot, has been this $40 million top line drawdown over the past 3 years. And that business has been positive for the past 4 months. But most importantly, the -- going into the end of September last year, the December backlog was tracking down $30 million. This year, it's tracking up $10 million, so we feel -- and it's still early, and that's on like a lower base of events, but we're pretty happy with where events is going. And if the trajectory stays, the December quarter is going to be a proof of concept that we can execute on the initiatives we lay out. Operator: Your next question comes from the line of Eric Handler from ROTH Capital. Eric Handler: I wonder if we could dig in a little deeper on events. A while back, you talked about how you were moving salespeople back into the facilities, and there were various initiatives to get the local community to come in and have like tasting programs and everything. What's been going on there? And how are you seeing the results from that? Robert Lavan: Yes. So we are moving the business forward every day. On July 1, we announced a full restructure. We went to a hybrid model where we have a split of our inbound business between huge companies and localized companies. And then we have our call center, which used to be unique to individual centers, is now covering parties sub-12. So it's a very rebalanced structure where the team can focus on outbound. And it's still early, but we're seeing the fruits of the labor there where we're developing clients. We had a client this week who was going to have a party in New York and their other offices grabbed on and had parties as well. So it's sort of everybody in the company was doing the same thing. And we're really building that outbound structure. And so again, this $40 million that we've lost over the past 3 years, I think, is very achievable to rebuild over the next few years. Eric Handler: Great. That's helpful. And then digging in a little bit more on SG&A was up a good amount year-over-year and sequentially. How much of that was due to promotion of the water parks? How much -- where -- what were the initiatives that didn't play out as expected? And what are some of the shifts that you're planning here? Robert Lavan: Yes. I mean the biggest thing is we are releasing a new CRM in October. And so those investments have been very heavy in the June and September, and they'll be heavy in the September quarter. It's the largest IT initiative the company has ever had. And so those just flow through SG&A. SG&A sequentially is flat to down. Operator: Your next question comes from the line of Randy Konik from Jefferies. Randal Konik: I guess, Tom, in the press release and in your remarks on the quarter, you talked about -- I mean you talked about the capital expenditures coming down fairly dramatically from peak levels. And I think there was a point made that if those will continue to be kind of, I guess, restrained going forward. Can you kind of elaborate on that? Let's dig into that a little bit more and think about on a multiyear basis, how do you think through what you believe is the appropriate levels of capital expenditure in the business? And then as you kind of look to generate and accelerate more free cash flow, how are you thinking about deploying that? Where are we with share repurchase activity and so on and so forth? That would be really helpful. Thomas Shannon: Well, our CapEx budget for fiscal 2027 is $90 million. So it continues to trend meaningfully lower. In that number, we are finishing the remaining Lucky Strike rebrands, and we are doing the AMF rebrands, most of which are already AMF, but not all. Some are transitioning from Bowlero brand or an independent brand to AMF. So by the end of this fiscal year, I think we will have finished the rebrandings, and we will only have 2 brands, which will make the marketing message much more focused and efficient, Lucky Strike and AMF. There's been, in the last 2 years, a significant amount of CapEx spent to sort of catch up deferred maintenance in the water parks and the Boomers that we acquired, and that wasn't a surprise. That was part of the investment thesis. And we bought these assets for very attractive prices, but there was a reason and they needed to be refreshed. So we're meaningfully through that cycle. We're also just much more efficient. So we've really become very, very good at doing large CapEx projects like a roof replacement or a parking lot replacement or HVAC upgrade for close to half or even less than we were paying historically by using national vendors with national contracts and all of that. So I think ultimately, the CapEx once we get through this rebranding cycle, we'll probably move into the $70 million to $80 million range. Again, we peaked, I think it was $194 million 2 years ago, down to $114 million in the last year and $90 million budgeted for this year. So a pretty good trajectory. Randal Konik: Great. Super helpful. I guess for Bobby, when you look at the guidance, I think it's slightly up on EBITDA at the midpoint. When you think about I guess, it's higher, excuse me, I was looking different guidance. But when you look at the different holdbacks you talked about, let's say, this year in the World Cup, investment in marketing, the difficult weather impacting the water parks, the California business being subdued or down. Maybe could you kind of dimensionalize for us how impactful those items have been on the P&L, whether from a revenue perspective or an EBITDA perspective to get some perspective of how potentially conservative this fiscal year guide could be for 2027? Robert Lavan: Yes. So weather in the third quarter was $10 million. The World Cup was at least $7 million in June, if not $10 million to $12 million. We were tracking in May very -- like I was super happy in May. May, we ended plus 2, and the momentum out of that was great. And then June 3rd happened, and on June 3rd was the first night of the Knicks championship. And we looked at the numbers the next day, and we're like, wow, this does not bode well for the World Cup. So it's at least $7 million, if not $12 million, because the World Cup did go until July 19. So you have, frankly, high single-digit, low double-digit comps the first few weeks of July. And then you had the water parks are about $3 million to $5 million of incremental weather, like there's always some weather. So all of those are there. That's what gives us confidence in a 1% to 3% comp this year. But if things go our way, it could be better -- but weather is something that we found is more volatile lately. So we're trying to not say, okay, everything is going to be perfect. So those numbers are partially derisked in the 1 to 3, but not fully derisked. Randal Konik: And maybe just finally, can you just give us a little bit more color on California in terms of just reminding us how big of a contribution it is to the business? How much -- how difficult it's been over the last year or 2. You talked about changing leadership. It sounds like things are getting sequentially better, i.e., less negative. So just kind of unpack that a little bit more. And do you think California can turn positive this next fiscal year? And if so, what quarter would that be most likely to occur in? Robert Lavan: Yes. So California comped minus 4% last year versus the rest of the company was plus 1%. So it's about 20% of the business. California is going to be driven by two things: retail, which we keep talking about marketing. Marketing continues to get better, but I'm not going to say that, that's going to be a key driver this year. Marketing -- California goes the way events go. So if events is -- continues momentum, I would expect California to turn, but we're not factoring that into our forecast this year. Operator: Your next question comes from the line of Eric Wold from Texas Capital Securities. Eric Wold: So 2 questions. I guess, first off, I know you mentioned, Bobby, a little bit on the parks in terms of trailing 12 months and the plan to kind of sell season passes earlier to maybe hedge out the weather a little bit. Can you just update us on the larger projects that are still at hand for the parks that you plan in the off-season and kind of what we could see next year from kind of capital improvements and new offerings that weren't there this year or what you think they could do? Thomas Shannon: This is Tom Shannon. I'll take this one. So we didn't close on Raging Waters Los Angeles, which is our biggest park, until January. And we inherited a deficit, a significant deficit in season passes. As a result, no season passes were really sold in the fall as the seller got ready to transact. The transaction was delayed because it required approval by L.A. County, which is the landlord for the park. And so the water parks were suboptimal, right, but we just acquired them, and we just acquired the 2 biggest in the portfolio. So there's a lot of things that will be done better and certainly with more runway, one of which is having more of a runway to sell season passes, at least in our 2 biggest water parks, but also there were some decisions made last year to open the Panhandle parks later in the year and to keep them open later, which is happening. And so some of the revenue deficit in Q4 of fiscal 2026 is a result of not having the 2 parks in the Panhandle open earlier and -- but they are going to go later. So let me just give you an interesting data point. Big Kahuna's in Destin, Florida, has had a positive attendance comp in 25 out of the last 30 days and Shipwreck Island in Panama City Beach has had a positive attendance comp in 19 out of the last 30 days. So it's a long summer season, and there were some pretty meaningful headwinds in the quarter that are not necessarily representative of, #1, the business as a whole, the water park business, but even of the summer because there's a lot of this revenue that we can make up and will and probably have made up already in the first quarter of fiscal '27. So it's hard to look at this business sort of on a snapshot basis. But that I think that explains a little bit about what happened and a little bit about what's happened since the fiscal year ended. With regard to CapEx, there are some semi-large projects that we like to do. I'd say semi-large on order of $5 million each in Shipwreck Island and in Big Kahuna's. I doubt if either of those will be approved in time to do in fiscal '27. So the CapEx in aggregate in the water parks will be pretty minimal, I would say, this -- in all likelihood this fiscal year. And then in the following year, we'd like to do these 2 large slide towers that would be -- would have a lot of presence from the street and drive traffic, also increase the nature of the parks, broaden the audience a little bit. And so that $10 million, give or take, is likely to happen in fiscal '28. Eric Wold: Got it. And then secondly, maybe update us on where you are with the labor efficiency moves. I know you talked a little bit about towards the end of the year, the savings kind of say maybe baseball analogy, but kind of how far along are you on kind of what's been saved so far? How much more do you think you can pull out of the bowling centers? And how far have you taken those initiatives at the water parks and FECs? Robert Lavan: Yes. So let's separate water parks and FECs and Bowling because water parks and FECs we're still figuring out what's the optimal labor model. On Bowling, we're running down $1 million year-over-year right now. So $1 million of savings a month. Our model assumes that, that flattens out and that there's actually an inflationary adjustment on payroll as we invest in people, we invest in sort of bonuses deeper in the system that ultimately drive KPIs that drive revenue. But it's a tailwind today, but I would assume it is moderate to flat to some investments that drive revenue throughout the rest of the year. Operator: Your next question comes from the line of Jeremy Hamblin from Craig-Hallum Capital Group. Jeremy Hamblin: So you guys are reducing your CapEx spend as you absorb some of these initiatives in the parks. I wanted to just understand in terms of thinking about the go forward, you've done several acquisitions here over the last few years. And in terms of thinking about the go-forward strategy, there has been a lot to absorb, including the FECs, which have probably a slightly different business model and certainly investment needs. But just thinking about, should we expect here over the next year or 2 as you absorb these that there may be a kind of reduced kind of acquisition strategy in total? As you work on kind of fine-tuning the operations for the water parks or as you kind of get through finishing the Lucky Strike conversions? Thomas Shannon: Yes. That is accurate to say. We're still in the M&A game, but only opportunistically. We're not actively looking for deals because there is so much opportunity to optimize the existing portfolio. But I want to be very clear that we view the water park and FEC acquisitions as extremely good even when the year is not ideal. There's still -- we're still in these for probably 6.5 to 7x. They are counterseasonal, so we generated a lot of cash this summer that we wouldn't have otherwise. There were nearly every -- other than the last week of the month or first week of the month when rent is paid or interest is paid, every week was cash flow positive on an operating basis, which we've never seen before because things slowed down on the Bowling side in the summer, but with the addition of these assets, we generated a lot of cash. And so we feel really, really good about them, but we are focused on 2 things: operational improvements, organic EBITDA growth and effective delevering. Jeremy Hamblin: Got it. And then, Tom, you noted that you're going to very carefully look at marketing investments that are being made and looking for high ROI on those investments. I think, Bobby, you said you've gone from 1% marketing budget to 2% or 2.5%. In terms of thinking about making those incremental investments, how are you viewing the channel of where you're spending on that? Do you feel like there's fine-tuning? And then how quickly do you get feedback on whether or not a particular marketing strategy has been effective or hitting the ROI that you're looking for? Robert Lavan: Yes. So we raised spend from $17 million to $30 million. Our impressions went from about 75 million a quarter to 350 million a quarter, but our engagement rate is not good enough. And so we're super focused on not taking the person who has intent to bowl and showing them our website more. We're focused on the people who don't necessarily have intent to bowl and getting them to want to bowl. And that is what we need to push this year. The feedback loop is instantaneous at this point. We have a lot of data that's just driving our -- the engagement with our content. We continue to invest in content. And so ultimately, we need to convert the people who don't have intent to intent, and that's where the growth will come from. We are seeing very significant growth in our lane reservations platform, which is the tip of the spear and the bottom of the funnel. And we need to continue to bring people in there that have more intent, and that's how we're looking at it. Jeremy Hamblin: Got it. And then just a quick follow-up. In terms of your marketing spend, portion of that spend is on your events business. It seems like that's quite a bit more volatile in general. But wondering what portion of your total marketing budget goes into the events portion of your business? Robert Lavan: Great question. It is none right now. So it is an opportunity. Operator: Your next question comes from the line of Michael Kupinski from NOBLE Capital Markets. Michael Kupinski: I just got a little color around the water parks a little bit. I know that you said that you're looking for higher per cap spending and improved labor efficiency. And I was just wondering if you can maybe quantify the expected incremental revenue and EBITDA contribution from the water parks in fiscal '27, particularly in September, if you could just add a little bit more color there. Robert Lavan: Yes. So TTM EBITDA in June was $14 million. Then it became $22 million at the end of July. It will be -- August is still not over. So August can be -- will drive that TTM to $26 million to $28 million, and then we'll have an incremental few million dollars more from September. One of the issues that Tom discussed is we do staff some of the water parks with J-1. So these are international students who come in. Instead of them coming in, in May, they came in for August and September. And so we're testing, pushing the season out. So there is a little bit of volatility in how much earnings we get in August and September, and that will also be dependent on the weather. Michael Kupinski: Got you. And then you're mentioning about the opportunity on events. How significant is events to the overall same-store revenue opportunity? And if you could just give us some sense of how bookings are going through the fall and into the holiday periods. Robert Lavan: Yes. So events has been the entire comp decline over the past 3 years. We've quantified it's about $40 million that we had in '23 that we don't have today. Ultimately, on top of the quantum, there is an element of events, corporate events during the week is very tip of the spear to traffic. Ultimately, if you go to a company event, you walk in, you have the wow factor of the Lucky Strike and you go, I'm bringing my kids this weekend. And so we've lost some of that over the past 3 years. And ultimately, our events business is a tiny percentage of the global or national events business. And so we just want to go out and get that. From our perspective, the December is our Super Bowl. Events becomes 40% of revenue in December. Last year, we were down the first 2 weeks of December. And so that business right now is tracking up. Michael Kupinski: Got you. And if I could squeeze 1 more in. You have, in the past, discussed rationalizing the location portfolio as capital intensity comes down. I was just wondering how many of your locations will you characterize as underperforming? And then should investors expect a meaningful number of closures, sales or other portfolio actions in fiscal '27? Thomas Shannon: Well, in one sense, you could say they all underperform their potential. The number of centers that we have that are EBITDA negative is like maybe two or three, one of which is a legacy property we inherited from when we bought Lucky Strike that we sort of knew we were just going to exit at the end of the lease term, which is coming up in the next 15 months or so. I would estimate in the next -- in this fiscal year, we'll probably shed on order of 10 properties. And most or all of these are properties that we acquired in the last 5 years after we went public, and we had a flurry of M&A activity because there was a focus on unit count, which in retrospect was a mistake and it's the mistake that won't be repeated. So we're just rationalizing the portfolio. There won't be anything that I would characterize as seismic. It's really just getting rid of centers in markets where they're peripheral and they're more of a hassle to manage than they're really additive to the portfolio. Robert Lavan: Yes. We're very focused on leverage. And so if we have properties that on a 4-wall basis, we can sell at an accretive leverage multiple and when you blow it down and say, 'What does it cost to send the field there, what is IT support, what is insurance support,' it's very accretive to our leverage position to sort of sell some of these fringe assets. And we've done a comprehensive review, looked at land values, go-dark values. And ultimately, there is an ability to use asset sales to delever the business. Operator: Your next question comes from the line of Ian Zaffino from Oppenheimer. Ian Zaffino: I just wanted to kind of dig into the comment about the per caps, water parks. What basically is driving some of that, call it, pricing power? Maybe there and then versus like your kind of other concepts, what's kind of being the differentiating factor there? Thomas Shannon: Well, the per caps in the water park were up this year on order of 15%, 15% to 20% as a range. So we decided after last year, which was a pretty good year that there were a lot of pricing opportunities. The season pass was simply too cheap last year in our view, and we took price. We introduced a super premium tier called Elite. And it surprisingly sold about 10% of them of the season passes were the Elite. So there was demand at the high end, certainly for that product, which was good. We deemphasized the season pass this year and we were successful in driving up per cap. It was partially responsible for decline in attendance, but our biggest water park in Los Angeles, it didn't reach 80 degrees there for the first month that it was open. And an air temp of 80 degrees is just not sufficient for a water park. The water temperature was frigid. So we lost -- I don't know, I haven't done the math, but probably 60% of attendance. We were down probably 60% in that month. Now it has rebounded. But one of the problems with having a slow start to the season is that is when it's most attractive for someone to buy a season pass, right? Because you get to amortize it over the rest of the summer. As you move through the summer, the season pass becomes relatively less attractive. We now view season pass in a completely different way than we did 4 months ago. 4 months ago, we viewed it really as a matter of pricing strategy and mix. We now view it as weather insurance. And so if it had been a good weather season for the water parks, we would look really, really smart for holding on to this premium price model. The problem is that you can't predict the weather. And if you have, in the case of Raging Waters Los Angeles, a slow start to the season or at Raging Waves in Yorkville, Illinois, an abnormally cold rainy summer, you need that built-in season pass revenue to reduce volatility. So this coming year, we'll strike more of a balance between volume and price. And I think we'll get closer to optimal on that. Ian Zaffino: Okay. And then just as a follow-up, Bobby, I know you said the trends were improving since your decline. But what are we kind of looking at now? Are we back to that 2% we saw in May? Is there any type of acceleration or any type of notable trends that you're seeing let's just say, July and August? Robert Lavan: Yes. So I mean, July, we're going to have to carry the first 2 weeks, first 2.5 weeks of World Cup. So July was down low single digits. August is flattening out, but it's not fully there. Events is strong, leagues is strong. The school shift and the Labor Day shift is a little weird. So ultimately, this weekend will be very important, whether August flips positive or negative. And so ultimately, we're more focused on the December quarter. But generally, we are expecting plus 1% to plus 3% throughout the year. Operator: Your next question comes from the line of David Hargreaves from Barclays. David Hargreaves: If we look at the 2027 guide of $340 million to $360 million, can you give us an idea of how much the contribution from the water parks and Boomers will be in that number? Robert Lavan: Yes. Water parks will be sort of somewhere between $28 million and $33 million, which really comes down to how September plays out and how June -- May and June next year play out. Boomers, which Boomers excludes Big Kahuna's, which came with Boomers. Boomers right now is $11 million of EBITDA. And with all the CapEx we put in there, that's anywhere between $10 million and $15 million for the next 12 months. David Hargreaves: Got it. And then if we take the midpoint of the guidance, interest, I imagine tax payments will be negligible and $90 million of CapEx. I think free cash flow should probably be around $50 million. I'm just wondering if that's a fair number to assume. Robert Lavan: That is a fair number to assume. That does not include any asset sales we do. David Hargreaves: So about -- okay. No, okay, it doesn't include asset sales. About half of that we could assume maybe is debt repayment? Robert Lavan: The goal would be to pay down the revolver by June. So yes. Operator: Your next question comes from the line of Gregory Miller from Truist Securities. Gregory Miller: Just one question for me. I'd like to dive more into the league performance, if possible, and your engagement with league players. I saw a press release intra-quarter that spoke about the decision to invest in lane conditioning and oil patterns. And I'm curious if that was driven by customer surveys and just how important that is to their satisfaction as league bowlers. Thomas Shannon: I think machine reliability and lane conditions are critically important to the league bowlers, and we are super focused on that now. We've made some structural changes to be able to ensure better machine reliability. We've upgraded the quality of the oil in league-heavy houses, and we're keeping a very close eye on it through feedback that we get both directly and through social media. So it's a big initiative. It coincides with a, I would say, reinvigorated league business. The league business is outperforming all of our other business lines right now, and it's an important business unit. It's $110 million, $120 million before ancillary spend. And so we view it as a significant growth vector for us going forward, but we have to deliver the product. Operator: There are no further questions at this time, and we have reached the end of the Q&A session. This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in Lucky Strike Entertainment, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lucky Strike Entertainment wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $440,710!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* Now, it’s worth noting Stock Advisor’s total average return is 978% — a market-crushing outperformance compared to 213% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 31, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Lucky Strike (LUCK) Q4 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Bowlero Corp.? Here are five stocks we like better. Fiscal 2026 performance improved: Revenue rose 4% to $1.245 billion and adjusted EBITDA reached $333 million, while same-store sales declined just 0.2%, helped by stronger bowling, league, food and event trends. Temporary headwinds affected results: June comparable sales fell 7% as major sports events drew customers away, while weather pressured water-park attendance; California remained the weakest market, with sales down 4%. Fiscal 2027 outlook emphasizes events and deleveraging: Lucky Strike expects adjusted EBITDA of $340 million to $360 million and same-store sales growth of 1% to 3%, while targeting about $50 million in free cash flow, lower capital spending and debt reduction. 3 Beaten Up Experiential Stocks to Cash in on a Good Time Bowlero (NYSE:BOWL), operating as Lucky Strike Entertainment, said fiscal 2026 revenue rose 4% to $1.245 billion while adjusted EBITDA reached $333 million, as improved bowling, food, league and event trends were partly offset by a late-year disruption from major televised sports and weather pressure at its water parks. For the fiscal year ended June 29, 2026, same-store sales declined 0.2%, an improvement of 3.5 percentage points from the prior year and the company’s strongest comparable-sales result since fiscal 2023, according to Founder and Chief Executive Thomas Shannon. Excluding California, same-store sales increased 0.9%. → Quantum Computing Is Raising the Stakes for Cybersecurity: 5 Stocks to Watch Bowlero is Quietly Cornering The Bowling Market Shannon said retail bowling and shoe revenue increased 2.9% on a comparable basis, league revenue rose 3.6%, and food sales increased 8%. Events, which management has identified as a key growth opportunity after a multiyear decline, turned positive in May and June and remained positive in July and August. Management said fourth-quarter trends began positively, with April roughly flat and May up 2%, before major sports programming affected customer traffic. Shannon attributed a 7% comparable-sales decline in June to record viewership for the World Cup and the New York Knicks’ NBA championship run. → NVIDIA Reveals $21 Billion SpaceX Stake: Signal of Confidence or Circular Financing? “For five straight weeks, millions of consumers who would ordinarily be bowling on a Friday or Saturday night were watching sports from home,” Shannon said. He described the impact as a one-time programming event rather than evidence of a weakening consumer, adding that trends improved after the World Cup final and August results were rebounding. President and Chief Financial Officer Bobby Lavan estimated that the World Cup affected June revenue by at least $7 million, potentially as much as $10 million to $12 million. He also cited approximately $10 million of weather-related revenue pressure from two snowstorms during the March quarter. → Berkshire Boosts Its Bet: This AI Hyperscaler Is Now a Top-3 Holding California remained the company’s weakest market, with comparable sales down 4% during fiscal 2026, compared with a 1% increase for the rest of the company. Lavan said California accounts for about 20% of the business. The company has replaced leadership in the state and is overhauling its corporate sales organization there, though management is not including a California turnaround in its fiscal 2027 forecast. Lucky Strike expanded its directly managed water-park portfolio to five locations during the summer, including Raging Waters Los Angeles, acquired in January for $45 million. The company said water parks generated $56 million in trailing 12-month revenue through July and $22 million in EBITDA, compared with $23 million in revenue and $11 million in EBITDA in fiscal 2025. Per-capita spending across the water-park portfolio increased by double digits, while payroll declined by the mid-single digits as staffing was aligned with demand. However, attendance was affected by weather, including cool and wet conditions near Chicago at Raging Waves and lower-than-ideal temperatures in Los Angeles. Shannon said the company plans to sell season passes earlier for the next season, viewing passes as a way to reduce weather-related revenue volatility. Management also expects to better balance season-pass volume and pricing after placing more emphasis on premium pricing this year. Its Boomers family entertainment centers generated $11 million in EBITDA during the year, nearly double the prior-year result, according to Shannon. The company said the businesses are counter-seasonal to bowling operations and were EBITDA-positive in every period. Lucky Strike forecast fiscal 2027 adjusted EBITDA of $340 million to $360 million and expects same-store sales growth of 1% to 3% through the year. Management characterized its EBITDA outlook as conservative, reflecting uncertainty around consumer conditions and weather rather than a change in its operating plan. Lavan said the December quarter will be a critical test for the restructured events business. Event bookings entering the end of September were tracking 10% higher than the prior year, compared with a 30% decline in the prior-year period. Events accounted for about 40% of revenue in December, he said. The company has reorganized its events sales operation into a hybrid structure that separates larger corporate accounts from localized business and uses a call center for smaller parties. Management said it sees an opportunity to recover roughly $40 million in event revenue lost over the past three years. Lucky Strike also plans to launch a new customer relationship management system in October. Lavan called it the company’s largest IT initiative to date, with related spending weighing on selling, general and administrative expenses in the June and September quarters. Fiscal 2027 capital expenditures are budgeted at $90 million, down from $114 million in fiscal 2026 and $194 million two years earlier. Management expects long-term annual capital expenditures to move toward $70 million to $80 million after its rebranding cycle is completed. The company expects to finish consolidating its branding around Lucky Strike and AMF by the end of fiscal 2027. Lucky Strike expects water parks to contribute $28 million to $33 million of EBITDA in fiscal 2027 and Boomers to contribute roughly $10 million to $15 million. Shannon said the company remains open to acquisitions but is pursuing them only opportunistically while it focuses on improving the current portfolio, growing organic EBITDA and reducing leverage. He said Lucky Strike may shed approximately 10 properties during fiscal 2027, primarily peripheral locations acquired during a prior period of active dealmaking. The company has only two or three EBITDA-negative centers, according to Shannon. Lavan said potential asset sales could be used to reduce leverage where sales values are attractive relative to the cost of supporting fringe locations. In response to an analyst’s free-cash-flow estimate, Lavan said approximately $50 million for fiscal 2027 was a fair assumption, excluding any asset sales. He said the company’s goal is to pay down its revolving credit facility by June. Bowlero Corporation operates one of the largest bowling center networks in North America, offering an array of bowling and entertainment experiences under its Bowlero, Bowlmor Lanes and AMF Bowling brands. The company's venues combine traditional ten-pin bowling with modern amenities such as full-service bars, food and beverage offerings, premium bowling lanes, and private event spaces. Bowlero also enhances guest experiences through live entertainment, arcade games, billiards tables and league-play programs tailored for casual bowlers and competitive enthusiasts alike. Since its origins in the mid-20th century as AMF Bowling, the business underwent a series of strategic transformations, including a merger with boutique operator Bowlmor Lanes and a subsequent rebranding initiative that introduced the Bowlero concept in the late 2010s. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Bowlero Q4 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Total Revenue: Grew 4% to $1.245 billion for fiscal 2026. Same-Store Sales: Comped minus 0.2% for the full year, a 3.5-point improvement over the prior year and the best comp performance since fiscal 2023. Adjusted EBITDA: $333 million for fiscal 2026. Ex-California Comp: Comped up plus 0.9% for the year. Retail Bowling and Shoe Revenue: Comped plus 2.9%. Leagues: Grew plus 3.6% and accelerated in each of the last four months. Food Comp: Comped plus 8%. Events: Turned positive in May and June for the first time since 2024 and remained positive in July and August. Capital Expenditures: Reduced by 19% to $114 million from $141 million last year and $194 million two years ago. Water Parks Revenue (Trailing 12-Month): Produced $56 million of revenue and $22 million of EBITDA, up from $23 million of revenue and $11 million of EBITDA in fiscal 2025. Boomers Parks EBITDA: Delivered $11 million of EBITDA this year, nearly double the prior year. Fiscal 2027 Guidance: Expects adjusted EBITDA of $340 million to $360 million. Warning! GuruFocus has detected 6 Warning Signs with LUCK. Is LUCK fairly valued? Test your thesis with our free DCF calculator. Release Date: August 27, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Lucky Strike Entertainment Corp (NYSE:LUCK) delivered its best same-store sales comp since fiscal 2023, with a 3.5-point improvement to -0.2%, and total revenue grew 4% to $1.245 billion. The company saw strong growth in key segments, including retail bowling and shoe revenue (up 2.9%), leagues (up 3.6%), and food (up 8%), with events turning positive for the first time since 2024. Water parks and Boomers parks are performing well, with water parks generating $22 million in EBITDA on a trailing 12-month basis (up from $11 million) and Boomers nearly doubling EBITDA to $11 million. Capital expenditures were reduced by 19% to $114 million, with a further reduction to $90 million budgeted for fiscal 2027, improving capital efficiency and free cash flow generation. The company is seeing strong momentum in its events business, with the December backlog tracking up 10% versus a 30% decline last year, and is planning to shed underperforming properties to deleverage. Labor efficiency initiatives are paying off, with payroll savings of $1 million per month in the bowling segment, and the company is making strategic investments in technology, including a new CRM system. Lucky Strike Entertainment Corp (NYSE:LUCK) faced significant headwinds from the World Cup and NBA Finals, which disrupted June and July trends, with June comping down 7% and costing at least $7 million to $12 million in revenue. The company's fiscal 2027 guidance of $340 million to $360 million in adjusted EBITDA implies a margin of around 27%, below the long-term target of 30% to 32%, reflecting a cautious outlook. California remains the weakest market, comping down 4% versus the rest of the company's plus 1%, and the company does not expect it to turn positive this year. Marketing investments have not delivered the expected ROI, with doubled working media spend failing to generate enough consumer intent, leading to a more cautious approach going forward. Water parks were negatively impacted by poor weather, with attendance falling significantly at Raging Waves and Raging Waters Los Angeles, costing an estimated $3 million to $5 million in incremental weather-related losses. The company is planning to shed approximately 10 properties in fiscal 2027, reflecting a rationalization of its portfolio and a shift away from a focus on unit count, which was acknowledged as a mistake. Q: Can you provide color on the margin assumptions for fiscal 2027 versus the long-term target, and what might be weighing on margins this year?A: Bobby Lavan (President & CFO): We added a slide to our investor deck showing that $900 million of revenue from pre-2022 properties runs at a 42% four-wall EBITDA margin, while $300 million from post-COVID investments runs at 30%. Getting that $300 million up brings us back to the 30% target. The 32% target is harder to achieve with marketing now at 2.5% to 3% of revenue versus 1% previously. We're being prudent with guidance as we invest in marketing, systems, and water park operations, making this an investment year. Q: How should we think about the same-store sales cadence for fiscal 2027, and are there any specific headwinds or tailwinds to consider?A: Bobby Lavan (President & CFO): June was the worst month we've ever seen due to the World Cup, creating a tailwind next year. We also had $10 million in revenue hit from snowstorms in the March quarter. The December quarter is the key focusevents backlog is tracking up 10% versus down 30% last year at this time. If that trajectory holds, the December quarter will be a proof of concept for our initiatives. Q: Can you elaborate on the events business restructuring and the results you're seeing?A: Bobby Lavan (President & CFO): On July 1, we restructured to a hybrid model with a split between large corporate and localized companies, and our call center now covers parties under 12. This rebalanced structure lets the team focus on outbound sales. We're seeing early fruits, like a client with a party in New York whose other offices also booked parties. The $40 million we've lost over the past three years is achievable to rebuild over the next few years. Q: Can you elaborate on the CapEx reduction trajectory and how you're thinking about capital deployment and share repurchases?A: Thomas Shannon (CEO): Our CapEx budget for fiscal 2027 is $90 million, down from $114 million last year and $194 million two years ago. We're finishing the Lucky Strike and AMF rebrands, after which we'll have only two brands. We've become much more efficient with national vendors, cutting project costs by half. Once the rebranding cycle finishes, CapEx should move to the $70-$80 million range. Q: Can you dimensionalize the impact of the various holdbacks (World Cup, weather, marketing investments) on the P&L to gauge how conservative the fiscal 2027 guide might be?A: Bobby Lavan (President & CFO): Weather in the third quarter was $10 million. The World Cup was at least $7 million in June, potentially $10-$12 million including early July. Water parks had $3-$5 million of incremental weather impact. These factors give us confidence in a 1% to 3% comp this year, but if things go our way, it could be better. These numbers are partially de-risked in the guidance but not fully. Q: Can you provide more color on California's performance, its contribution to the business, and when it might turn positive?A: Bobby Lavan (President & CFO): California comped minus 4% last year versus the rest of the company at plus 1%, representing about 20% of the business. California's performance is driven by retail and events. If events momentum continues, I'd expect California to turn, but we're not factoring that into our forecast this year. Q: Can you update us on the larger capital projects planned for the water parks in the off-season and what new offerings we might see next year?A: Thomas Shannon (CEO): We didn't close on Raging Waters LA until January, inheriting a season pass deficit. We're now viewing season passes as weather insurance rather than just pricing strategy. There are semi-large projects (~$5 million each) planned for Shipwreck Island and Big Kahuna's, but they likely won't be approved for fiscal 2027. These two large slide towers, totaling about $10 million, are more likely for fiscal 2028. Q: Where are you with labor efficiency moves, and how much more can you pull out of the bowling centers and apply to water parks and FECs?A: Bobby Lavan (President & CFO): For water parks and FECs, we're still figuring out the optimal labor model. In bowling, we're running $1 million in savings per month year-over-year. Our model assumes this flattens out with inflationary adjustments as we invest in people and bonuses to drive KPIs and revenue. It's a tailwind today, but I'd assume it moderates to flat with some revenue-driving investments throughout the year. Q: Should we expect a reduced acquisition strategy over the next year or two as you absorb the water parks and FECs?A: Thomas Shannon (CEO): We're still in the M&A game but only opportunistically, not actively looking for deals. The water park and FEC acquisitions are extremely good, even in a non-ideal year, at 6.5 to 7 times. They're counter-seasonal, generating cash in the summer when bowling slows. We're focused on operational improvements, organic EBITDA growth, and effective deleveraging. Q: How are you viewing marketing channel investments, and how quickly do you get feedback on ROI?A: Bobby Lavan (President & CFO): We raised spend from $17 million to $30 million, increasing impressions from 75 million to 350 million per quarter, but engagement rates aren't good enough. We're focused on converting people without intent to bowl rather than showing our website to those who already have intent. The feedback loop is instantaneous with our data. We're seeing significant growth in our lane reservations platform, which is the bottom of the funnel. Q: Can you quantify the expected incremental revenue and EBITDA contribution from water parks in fiscal 2027, particularly in September?A: Bobby Lavan (President & CFO): TTM EBITDA was $14 million in June, $22 million at the end of July, and we expect $26-$28 million after August, with a few million more from September. We're testing pushing the For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Total Revenue Growth of 0.9% in Fourth Quarter 2026 Continued expansion of Lucky Strike brand with 159 current Lucky Strike locations Continued efforts to deploy capital efficiently, driving long-term returns RICHMOND, Va., August 27, 2026--(BUSINESS WIRE)--Lucky Strike Entertainment (NYSE: LUCK), one of the world’s premier owner/operators of location-based entertainment, today provided financial results for the fourth quarter and full year of fiscal year 2026, which ended on June 28, 2026. Quarter Highlights: Total revenue increased 0.9% to $303.9 million versus 4Q25 Same-Store Revenue decreased 2.5% versus 4Q25 Net loss of $26.2 million versus net loss of $74.7 million in 4Q25 Adjusted EBITDA of $74.1 million versus $88.7 million in 4Q25 Fiscal Year Highlights: Revenue increased 3.7% to $1,245.3 million versus the prior year Same Store Revenue decreased 0.2% versus the prior year Net loss of $35.8 million versus prior year net loss of $10.0 million Adjusted EBITDA of $333.2 million versus prior year of $367.7 million Added six locations during the fiscal year, five through acquisitions and one new build. Additionally, closed five underperforming locations Total locations in operation as of August 27, 2026, were 366 "Fiscal 2026 marked a meaningful step forward for our business, with our strongest same-store sales performance in years and clear momentum across many of our key revenue streams," said Thomas Shannon, Founder and CEO. "Importantly, that momentum is broadening. Cumulative organic growth was positive through the first eleven months of the fiscal year, with June driving the full-year decline. Leagues grew and accelerated through the spring, food remained strongly positive, retail bowling continued to grow, and Events turned positive in late spring for the first time in years and remained positive throughout the summer. It is the strongest sustained performance we have seen from that business in a long time." "June temporarily interrupted that progress. The first World Cup on American soil in a generation drew millions of consumers to their screens on nights they would typically be out, resulting in sharply negative comps for the month and pulling an otherwise positive quarter and year slightly below zero. We believe it is important to distinguish that temporary disruption from the underlying health of the business. Trends improved immediately following the World Cup Final, and this headwind will not repeat next summer. At our waterparks, a cool and wet start to the summer pressured attendance, but strong pricing and disciplined cost management helped protect profitability." "Waterparks represented the biggest operational step forward for us this summer. A year ago, we directly managed only a couple of parks. This summer, we operated a diverse portfolio, including our newest park in Los Angeles, and the organization executed exceptionally well. Per-capita spending increased meaningfully, labor costs declined as we aligned staffing more closely with demand, and both revenue and profitability grew substantially year over year. Importantly, the majority of the summer earnings contribution will be recognized in our September quarter." "I have described our business as a coiled spring, and that is exactly how we see it. We are pairing operating momentum with a structurally more disciplined approach to capital allocation. Capital expenditures are down approximately $80 million from their fiscal 2024 peak, and we expect to continue reducing capital spending as we further rationalize the portfolio and complete several existing investment programs. That creates a clear path to meaningfully higher free cash flow and accelerated deleveraging as earnings improve. As we enter fiscal 2027, our guidance is intentionally prudent and reflects the way we are approaching the current environment. We believe the combination of operating momentum, declining capital intensity and financial discipline positions us to deliver profitable growth, stronger free cash flow and a meaningfully improved balance sheet." Fiscal Year 2027 Guidance We remain focused on delivering sustainable, profitable growth and creating meaningful long-term shareholder value. Our strategy is centered on accelerating revenue growth, expanding operating cash flow, and driving higher free cash flow per share through earnings growth and disciplined capital allocation. Looking ahead, our outlook reflects continued organic revenue growth, targeted investments in marketing and technology to strengthen our platform, and incremental contributions from our waterparks in FY27. Together, these initiatives position us to generate stronger cash flow, improve returns on invested capital, and build a more durable earnings growth profile. Dividend Declaration On August 27, 2026, the Board of Directors declared a quarterly cash dividend of $0.06 per share of common stock for the first quarter of fiscal year 2027. The dividend will be payable on September 22, 2026, to stockholders of record on September 8, 2026. Investor Webcast Information Listeners may access an investor webcast hosted by Lucky Strike Entertainment. The webcast and results presentation will be accessible at 9:00 AM ET on August 27, 2026, in the Events & Presentations section of the Lucky Strike Entertainment Investor Relations website at https://ir.luckystrikeent.com/. About Lucky Strike Entertainment Lucky Strike Entertainment is one of the world’s premier location-based entertainment platforms. With over 360 locations across North America, Lucky Strike Entertainment provides experiential offerings in bowling, amusements, water parks, and family entertainment centers. The Company also owns the Professional Bowlers Association, the major league of bowling and a growing media property that boasts millions of fans around the globe. For more information on Lucky Strike Entertainment, please visit IR.LuckyStrikeEnt.com. Forward Looking Statements Some of the statements contained in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risk, assumptions, and uncertainties, such as statements of our plans, objectives, expectations, intentions, and forecasts. These forward-looking statements reflect our views with respect to future events as of the date of this release and are based on our management’s current expectations, estimates, forecasts, projections, assumptions, beliefs, and information. Although management believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. All such forward-looking statements are subject to risks and uncertainties, many of which are outside of our control, and could cause future events or results to be materially different from those stated or implied in this document. It is not possible to predict or identify all such risks. These risks include, but are not limited to: our ability to design and execute our business strategy; changes in consumer preferences and buying patterns; our ability to compete in our markets; the occurrence of unfavorable publicity; risks associated with long-term non-cancellable leases for our locations; our ability to retain key managers; risks associated with our substantial indebtedness and limitations on future sources of liquidity; our ability to carry out our expansion plans; our ability to successfully defend litigation brought against us; failure to hire and retain qualified employees and personnel; cybersecurity breaches, cyber-attacks and other interruptions to our and our third-party service providers’ technological and physical infrastructures; catastrophic events, including war, terrorism and other conflicts; public health emergencies and pandemics, such as the COVID-19 pandemic, or natural catastrophes and accidents; fluctuations in our operating results; economic conditions, including the impact of increasing interest rates, inflation and recession; and other factors described under the section titled "Risk Factors" in the Company's Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the "SEC") by the Company on August 27, 2026, as well as other filings that the Company will make, or has made, with the SEC, such as Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this press release and in other filings. We expressly disclaim any obligation to publicly update or review any forward-looking statements, except as required by applicable law. Non-GAAP Financial Measures To provide investors with information in addition to our results as determined under Generally Accepted Accounting Principles ("GAAP"), we disclose Same Store Revenue and Adjusted EBITDA as "non-GAAP measures", which management believes provide useful information to investors because each measure assists both investors and management in analyzing and benchmarking the performance and value of our business. Accordingly, management believes that these measurements are useful for comparing general operating performance from period to period, and management relies on these measures for planning and forecasting of future periods. Additionally, these measures allow management to compare our results with those of other companies that have different financing and capital structures. These measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for revenue or net income as calculated in accordance with GAAP, and may not be comparable to a similarly titled measure reported by other companies. Our fiscal year 2027 guidance measures (other than revenue) are provided on a non-GAAP basis without a reconciliation to the most directly comparable GAAP measure because the Company is unable to predict with a reasonable degree of certainty certain items contained in the GAAP measures without unreasonable efforts. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Such items include, but are not limited to, acquisition-related expenses, share-based compensation, and other items not reflective of the company's ongoing operations. Same Store Revenue represents total Revenue less Non-Location Related Revenue, Revenue from Closed Locations, Service Fee Revenue, if applicable, and Acquired Revenue. Adjusted EBITDA represents Net Income (Loss) before Interest Expense, Income Taxes, Depreciation and Amortization, Impairment and Other Charges, Share-based Compensation, EBITDA from Closed Locations, Foreign Currency Exchange Loss (Gain), Asset Disposition Loss (Gain), Transactional and other advisory costs, System modernization costs, changes in the value of earnouts, and other. The Company considers Same Store Revenue as an important financial measure because it provides comparable revenue for locations open for the entire duration of both the current and comparable measurement periods. The Company considers Adjusted EBITDA as an important financial measure because it provides a financial measure of the quality of the Company’s earnings. Other companies may calculate Adjusted EBITDA differently than we do, which might limit its usefulness as a comparative measure. Adjusted EBITDA is used by management in addition to and in conjunction with the results presented in accordance with GAAP. We have presented Adjusted EBITDA solely as a supplemental disclosure because we believe it allows for a more complete analysis of results of operations and assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. GAAP Financial Information Balance Sheet and Liquidity As of June 28, 2026 and June 29, 2025, our calculation of net debt was as follows: As of June 28, 2026 and June 29, 2025, our cash on hand and revolving borrowing capacity was as follows: GAAP to non-GAAP Reconciliations View source version on businesswire.com: https://www.businesswire.com/news/home/20260827438985/en/ Contacts Lucky Strike Entertainment Corporation Investor [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributed a June same-store sales decline of 7% to an 'extraordinary stretch' of at-home sports viewership, specifically the World Cup and NBA Finals, which disrupted typical weekend bowling patterns. The company reported a 3.5-point improvement in same-store sales comps over the prior year, driven by strength in retail bowling, shoe revenue, and a significant 8% growth in food sales. California remains the weakest market, comping at minus 4% compared to plus 1% for the rest of the company, prompting a leadership overhaul and a restructuring of the state's corporate sales organization. Strategic integration of five directly managed water parks increased operational complexity but delivered double-digit per capita spending growth through disciplined revenue management. Management implemented significant cost actions in mid-January, successfully turning a $6 million payroll overrun in Q2 into a payroll tailwind by the fourth quarter. The company is shifting its marketing strategy after doubling working media spend failed to generate sufficient intent, moving toward more targeted, measurable investments with higher return thresholds. Capital expenditure was reduced by 19% year-over-year to $114 million, reflecting a broader strategic pivot toward capital efficiency and operational optimization over aggressive unit growth. Fiscal 2027 adjusted EBITDA guidance of $340 million to $360 million reflects a 'deliberately conservative' stance to account for macro uncertainty and potential weather volatility. Management expects same-store sales growth of 1% to 3% for the full year, supported by a rebounding August and a lack of major sporting event disruptions in the coming summer. Capital expenditures are budgeted to decrease further to $90 million in fiscal 2027, with a long-term target of $70 million to $80 million once the current rebranding cycle concludes. The company plans to utilize water park season passes as 'weather insurance' by selling them earlier in the season to hedge against the impact of cold or rainy summer months. A new CRM system launching in October represents the company's largest IT initiative to date, aimed at improving customer engagement and converting awareness into intent. The company plans to rationalize its portfolio by shedding approximately 10 peripheral properties in fiscal 2027 to focus on higher-performing markets and deleverage the balance sheet. Weather remains a primary risk factor for the water park segment, as evidenced by significant attendance drops at the Chicago-area park during an abnormally cold and rainy June. Management acknowledged that past M&A activity focused too heavily on unit count, leading to the acquisition of some fringe assets that are now being reviewed for potential sale. The events business, which saw a $40 million top-line drawdown over three years, has been positive for four consecutive months, including May and June, and underwent a full sales platform restructuring on July 1. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management remains confident in the 30% to 32% target but noted that increased marketing spend (from 1% to 3% of revenue) creates a mathematical headwind to those margins. The margin gap is driven by a $300 million revenue cohort of newer properties running at 30% margins compared to the 42% margins seen in pre-2022 properties. The company moved to a hybrid sales model on July 1, splitting inbound business between large and local companies while using a call center for smaller parties. The December quarter is viewed as a 'proof of concept' for this restructure, with the event backlog currently tracking up $10 million compared to being down $30 million last year. Lucky Strike will remain 'opportunistically' involved in M&A but is not actively seeking deals, prioritizing organic EBITDA growth and effective deleveraging instead. Free cash flow for fiscal 2027 is estimated at approximately $50 million, with the primary goal of paying down the revolver by June. Management is investing in higher-quality lane oil and machine reliability to support the league business, which is currently outperforming other business lines. Leagues represent a $110 million to $120 million revenue stream and are viewed as a significant growth vector for fiscal 2027.