03:11 PM EDT, 06/11/2025 (MT Newswires) -- Dave & Buster's Entertainment (PLAY) fiscal Q1 results reflected "pressured sales" due to a "difficult macro backdrop," but trends appear to be improving in Q2, UBS Securities said in a note Wednesday.

Dave & Buster's on Tuesday reported fiscal Q1 adjusted earnings of $0.76 per diluted share on sales of $567.7 million. That was down from $1.12 on revenue of $588.1 million a year earlier, and below the FactSet consensus of $1.01 on sales of $566.8 million.

In addition to macroeconomic pressures, the quarter was impacted by "lingering self-inflicted brand challenges," UBS said.

However, the firm noted sequential improvement through Q1 and into the first five weeks of Q2, with same-store sales down 2.2% quarter-to-date, an improvement from an 8.4% decline in Q1, suggesting early traction from the company's "back to basics" strategic plan.

"While still in the early stages of a turnaround, with macro pressure still elevated, we believe an eventual return to positive same-store sales represents potential upside for shares given [Dave & Buster's] attractive margins, solid unit growth, and EBITDA potential," according to the note.

UBS maintained its neutral rating on the stock and raised its price target to $29 from $18, citing improving industry valuations and initial progress on strategic initiatives.

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