Dave & Buster’s Entertainment Inc (NASDAQ:PLAY) shares are trading lower in Tuesday’s after-hours session after the company reported third-quarter financial results and announced a CEO transition.

What Happened: Dave & Buster’s reported third-quarter revenue of $453 million, missing analyst estimates of $563.6 million, according to estimates from Benzinga Pro. The company reported an adjusted loss of 45 cents per share, well below estimates for positive earnings of 90 cents per share.

Total revenue decreased 3% year-over-year as comparable store sales fell 7.7%. The company ended the quarter with $8.6 million in cash and $537.4 million of availability under its $650 million revolving credit facility.

“During the quarter, we continued to make progress towards our long-term strategic goals. We opened up three new stores, which are on track to generate strong cash on cash returns as we have consistently demonstrated throughout our history,” said Darin Harper, CFO of Dave & Buster’s. 

“We completed 11 new fully programmed remodels and are on track to have 44 completed by the end of fiscal 2024. Our fully programmed remodels continue to outperform the rest of the store base and we are excited for the opportunity these remodels give us to drive traffic, sales and EBITDA.”

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The company also announced that CEO Chris Morris handed in his resignation to pursue other interests. The board said it has been working with a global executive search firm in recent months to assist in identifying the company’s next permanent CEO.

In the meantime, board chair Kevin Sheehan will serve as interim CEO. The board has also appointed director James Chambers as vice chair of the board. During the transition period, director Michael Griffith will temporarily assume the role of lead independent director.

PLAY Price Action: Dave & Buster’s shares were down 10.87% in after-hours, trading at $32.80 at the time of publication Tuesday, according to Benzinga Pro.

Photo: Shutterstock.