Bowlero Q4 Earnings Call Highlights

Bowlero, 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%. 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. “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. 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.