Dave & Buster’s Entertainment Inc. served up some disappointing news with its first-quarter results, reporting a near double-digit drop in same-store sales on June 10th. The reason? Budget-conscious consumers are tightening their belts, spending less on dining and entertainment. The company is still feeling the effects of a tough end to fiscal 2025.

However, the post-market reaction was surprising. Shares jumped despite the underwhelming performance. Interim CEO Kevin Sheehan, speaking during the company’s conference call with analysts, attributed this to the company’s ongoing ‘back-to-basics’ strategy. He explained that the company is actively recovering from the disruption caused by the departure of former CEO Chris Morris in December 2024, a change that led to a significant overhaul of the company’s operations.

Sheehan acknowledged the first quarter’s performance fell short of expectations, stating that the “back-to-basics” approach is showing promise and driving a substantial recovery in sales. He highlighted key changes implemented during the quarter, including improvements to marketing, menu optimization, restaurant renovations, and strategic adjustments to their game selection. These changes aim to steer the company back on track towards profitability.

While the road to recovery is clearly underway, investors appear optimistic about Dave & Buster’s ability to navigate these challenges and regain its footing in the competitive entertainment and dining landscape.