Good Times Restaurants Reports 2.4% Revenue Decline but Increased Net Income in Latest Quarter

Good Times Restaurants Inc. reported a decrease in net revenues for the fiscal quarter ended July 1, 2025, totaling $37.0 million, down 2.4% from $37.9 million in the same quarter of the previous year. The decline was attributed to a decrease in sales from both its Bad Daddy’s Burger Bar and Good Times Burgers & Frozen Custard brands, with Bad Daddy’s sales falling by $814,000 to $26.5 million and Good Times sales decreasing by $59,000 to $10.4 million. The company noted that reduced customer traffic and the closure of one restaurant in each brand contributed to the revenue drop, although menu price increases partially offset these losses.

In terms of profitability, Good Times Restaurants reported a net income of $1.5 million for the quarter, an increase from $1.4 million in the prior year. The company’s income from operations remained stable at $1.2 million, reflecting a slight increase from $1.2 million in the same quarter last year. The increase in net income was primarily due to a lower provision for income taxes, which amounted to a benefit of $363,000 compared to $197,000 in the previous year. The company’s effective tax rate also decreased significantly, contributing to the improved net income figures.

Operationally, Good Times Restaurants has continued to expand its footprint, operating a total of 40 Bad Daddy’s and 30 Good Times locations as of July 1, 2025. The company has made strategic acquisitions, including two Good Times restaurants previously owned by franchisees, which contributed to the increase in Good Times sales. However, same-store sales for both brands declined, with Bad Daddy’s down 1.4% and Good Times down 9.0%, indicating challenges in maintaining customer traffic.

The company’s financial position showed a working capital deficit of $8.5 million, influenced by short-term lease liabilities of $6.3 million. Despite this, Good Times Restaurants expressed confidence in its ability to meet capital needs through existing cash and future borrowings from its Cadence Credit Facility, which has a total borrowing capacity of $8 million. The company’s cash flow from operating activities decreased to $1.5 million from $4.7 million in the prior year, while cash used in investing activities increased to $3.2 million, reflecting ongoing investments in property and equipment.

Looking ahead, Good Times Restaurants aims to enhance customer traffic and brand awareness while pursuing unit growth opportunities. The company plans to adopt a more conservative approach to leverage and real estate selection in light of current economic conditions, including inflationary pressures on food and labor costs. The management remains cautious but optimistic about navigating these challenges and achieving growth in the upcoming fiscal periods.