Kura Sushi USA Reports 13.3% Revenue Growth but Increased Net Loss in Q2 Fiscal 2025

Kura Sushi USA, Inc. reported its financial results for the second quarter of fiscal year 2025, revealing a revenue increase of 13.3% to $64.9 million compared to $57.3 million in the same period last year. For the six months ended February 28, 2025, total sales reached $129.4 million, an 18.9% increase from $108.8 million in the prior year. Despite the revenue growth, the company experienced a net loss of $3.8 million for the quarter, significantly higher than the $998,000 loss reported in the same quarter of the previous year. The net loss for the six-month period also increased to $4.7 million from $3.0 million.

The company's operating expenses rose in tandem with its revenue growth, with total operating expenses for the quarter increasing by 17.8% to $69.5 million. This rise was driven by higher restaurant operating costs, which totaled $58.4 million, up 15.2% year-over-year. Notably, labor and related costs surged by 19.4% to $22.6 million, reflecting the impact of new restaurant openings. Kura Sushi opened nine new locations during the six months, expanding its footprint to 73 restaurants across 20 states and Washington, D.C. The company plans to open a total of 14 new restaurants in fiscal year 2025.

In terms of operational metrics, Kura Sushi reported a decrease in comparable restaurant sales, which fell by 5.3% for the quarter and 1.6% for the six-month period. This decline was attributed to reduced customer traffic, despite the addition of new locations. The company’s total assets increased to $410.4 million as of February 28, 2025, up from $328.5 million at the end of the previous fiscal year, primarily due to cash generated from a follow-on public offering that raised $64.4 million in net proceeds.

Kura Sushi's financial outlook remains cautious as it navigates rising costs associated with food, labor, and occupancy, which are expected to continue impacting profitability. The company is also monitoring the potential effects of tariffs on its supply chain and operating costs. Management anticipates that the increased number of restaurant openings will contribute positively to revenue growth, although they expect general and administrative expenses to rise as well to support this expansion.

Overall, Kura Sushi USA, Inc. is focused on leveraging its growth strategy while managing the challenges posed by increased operational costs and market conditions. The company remains committed to enhancing its dining experience and expanding its market presence in the competitive restaurant industry.