Consumers were not keen on dining out and playing games at Pinstripes this summer and early fall season.
Same-store sales dropped 9.4 percent during the chain’s Q2 (late July to mid-October), including a roughly 13 percent decrease in open play and a 6 percent dip in event business. Keep in mind, open play mixes 56 percent while events mix 44 percent.
From mid-July to mid-August, Pinstripes was at negative 8 percent. It fell even further to around negative 12 percent in mid-August to mid-September and then lifted back to negative 8 percent in mid-September to the end of the quarter.
“This is a macro environment that we haven’t seen in some time,” CFO Tony Querciagrossa said during Pinstripes’ Q2 earnings call. “And so that’s probably amplifying a bit of what is otherwise us lapping some pretty big comps over the last couple of years.”
As of October 13, Pinstripes had $3.2 million in cash and cash equivalents and $114 million in debt outstanding. The chain expects significant positive cash flow in Q3 as holiday sales roll in, but it’s also seeking to raise more capital, which could from new outside sources as well as from existing lenders.
“We believe our current liquidity situation, given the build-in cash that we’ll see here as we work through the holiday season, plus the cost out that we’ve completed, we should be able to get through most of calendar ’25 with our current liquidity situation and debt service,” Querciagrossa said. “We’re looking at raising additional capital, so we’re not being shy about that. But we do have, with the holiday season and what we’re seeing on the outlook, enough liquidity to get well into next year.”
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The company’s Q1 was tough as well. Comps fell 2.4 percent, including a 1 percent decrease in May, an almost 6 percent downturn in June, and a relatively flat performance in July.
Pinstripes is still figuring out what works and what doesn’t when it comes to attracting customers who have tightened their wallets.
To improve open play, the company is turning to discounting, like its happy hour gaming promotion in which guests can bowl for 50 percent off during certain hours. Pinstripes also offers daily specials and weekend brunch offerings. The chain is combining those promotions with local store marketing campaigns around kids clubs, comedy nights, line dancing, yoga classes, and trivia nights.
In the early part of Q2, the chain decreased its paid digital spend and saw a notable decrease in sales. The company quickly course-corrected, and sales have benefited. Same-store sales were down 8.1 percent in Q3 through November 24, but shifted to positive 10.1 percent in the past two weeks.
Part of that surge is due to the resumption of digital marketing and the other portion is from a stronger events business. The holiday event period is a significant source of EBITDA for the company.
“Our teams are working hard to drive as many events as possible for Pinstripes through the holiday season,” said CEO Dale Schwartz. “We are encouraged by the fact that we are seeing strong lead generation and booking performance on the event side of the business in recent weeks, and our continued investment in the tourism and convention segment of our event business is showing very promising bookings and sales results.”
For Q2, total revenue increased 7.5 percent to $26.5 million, compared to $24.6 million last year, including an 8.6 percent increase in food and beverage revenues and a 3.6 percent increase in recreation revenues. The rise in total revenue was primarily due to four store openings in the second quarter, partially offset by modest decreases in volume at 13 legacy locations.
Pinstripes also saw a net loss of $10 million, an operating loss of $7.6 million, and adjusted EBITDA of negative $3.5 million during the third quarter.
On November 15, Pinstripes opened its 18th location in Walnut Creek, California, marking its second unit in the San Francisco metro area. The two-story venue features 25,000 square feet across two levels, with eight bowling lanes, two indoor bocce courts, and private event space for groups of up to 1,500.
