FAT Brands misses Q3 revenue estimates hurt by decrease in restaurant revenue

Fat Brands

05/11/2025 22:20

Overview

FAT Brands fiscal Q3 revenue declines 2.3% yr/yr, missing analyst expectations

Adjusted EBITDA for fiscal Q3 misses analyst estimates, indicating operational challenges

Company focuses on co-branding and partnerships for future growth

Outlook

Company expects $50-$60 mln incremental EBITDA from 900 committed locations

Company advancing $75-$100 mln equity raise to pay down debt

Company sees positive cash flow in upcoming quarters

Result Drivers

CO-BRANDING SUCCESS - Co-branding initiatives, such as the dual-branded Round Table Pizza and Fatburger location, have doubled weekly sales and transactions, highlighting potential for growth

STRATEGIC EXPANSION - 60 new restaurant openings this year and a pipeline of 900 committed locations are expected to drive future growth

FINANCIAL RESTRUCTURING - Efforts to restructure debt and pause dividends aim to preserve cash flow and reduce overall debt

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Miss
$140 mln
$144.90 mln (2 Analysts)
Q3 Adjusted EPS
-$2.67
Q3 EPS
-$3.39
Q3 Adjusted Net Income
Miss
-$45.4 mln
-$34.90 mln (2 Analysts)
Q3 Net Income
-$58.2 mln
Q3 Adjusted EBITDA
Miss
$13.1 mln
$17.30 mln (1 Analyst)

Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

The average consensus recommendation for the restaurants & bars peer group is "buy"

Wall Street's median 12-month price target for FAT Brands Inc is $10.00, about 82.5% above its November 4 closing price of $1.75

Press Release: ID:nGNX9761D5

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)