Lucky Strike Entertainment - 10-Q quarterly report FY

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________

FORM 10-Q

___________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 29, 2026


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-40142

___________________________________

LUCKY STRIKE ENTERTAINMENT CORPORATION

(Exact name of registrant as specified in its charter)

___________________________________


Delaware									98-1632024
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

7313 Bell Creek Road
Mechanicsville, Virginia									23111
(Address of Principal Executive Offices)									(Zip Code)

(804) 417-2000

Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	LUCK	The New York Stock Exchange

Securities registered pursuant to section 12(g) of the Act: None

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The registrant had outstanding 78,102,751 shares of Class A common stock, 58,519,437 shares of Class B common stock, and 117,087 shares of Series A preferred stock as of April 30, 2026.

Table of Contents

Index to Notes

Table of Contents


		Page
Part I - Financial Information
Item 1.	Financial Statements	i
	Condensed Consolidated Balance Sheets (unaudited)	1
	Condensed Consolidated Statements of Operations (unaudited)	3
	Condensed Consolidated Statements of Comprehensive (Loss) Income (unaudited)	4
	Condensed Consolidated Statements of Changes in Temporary Equity and Stockholders’ (Deficit) Equity (unaudited)	5
	Condensed Consolidated Statements of Cash Flows (unaudited)	7
	Index for Notes to Condensed Consolidated Financial Statements (unaudited)	9
	Notes to Condensed Consolidated Financial Statements (unaudited)	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38
Item 4.	Controls and Procedures	38

Part II - Other Information
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 6.	Exhibits and Financial Statement Schedules	39

Signatures		40

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Condensed Consolidated Balance Sheets

(Amounts in thousands)

(Unaudited)

Item 1. Condensed Consolidated Financial Statements


	March 29, 2026		June 29, 2025
Assets
Current assets:
Cash and cash equivalents	$	58,654	$	59,686
Accounts and notes receivable, net	7,330		7,998
Inventories, net	15,094		15,500
Prepaid expenses and other current assets	38,283		29,366
Assets held-for-sale	756		—
Total current assets	120,117		112,550

Property and equipment, net	1,253,383		944,917
Operating lease right of use assets	553,294		588,594
Finance lease right of use assets, net	302,322		507,701
Intangible assets, net	53,003		45,562
Goodwill	886,568		844,351
Deferred income tax asset	49,490		67,919
Other assets	48,036		48,145
Total assets	$	3,266,213	$	3,159,739

Liabilities, Temporary Equity and Stockholders’ Deficit
Current liabilities:
Accounts payable and accrued expenses	$	183,623	$	145,188
Current maturities of long-term debt	9,573		10,162
Current obligations of operating lease liabilities	35,391		33,103
Earnout liability	5,009		—
Other current liabilities	6,414		5,932
Total current liabilities	240,010		194,385

Long-term debt, net	1,739,134		1,300,708
Long-term obligations of operating lease liabilities	570,152		606,692
Long-term obligations of finance lease liabilities	427,992		683,161
Long-term financing obligations	455,590		449,215
Earnout liability	—		36,183
Other long-term liabilities	56,838		56,307
Deferred income tax liabilities	4,843		4,434
Total liabilities	3,494,559		3,331,085

Commitments and Contingencies (Note 9)

Table of Contents

Index to Notes


	March 29, 2026		June 29, 2025
Temporary Equity
Series A preferred stock	$	134,424	$	127,325

Stockholders’ Deficit
Class A common stock	12		12
Class B common stock	6		6
Additional paid-in capital	449,601		472,889
Treasury stock, at cost	(490,318)		(457,917)
Accumulated deficit	(322,784)		(313,181)
Accumulated other comprehensive income (loss)	713		(480)
Total stockholders’ deficit	(362,770)		(298,671)
Total liabilities, temporary equity and stockholders’ deficit	$	3,266,213	$	3,159,739

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Condensed Consolidated Statements of Operations

(Amounts in thousands, except share and per share amounts)

(Unaudited)


	Three Months Ended				Nine Months Ended
	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Revenues
Bowling	$	164,590	$	159,756	$	432,727	$	420,926
Food & beverage	118,697		120,452		327,223		319,393
Amusement & other	58,944		59,674		181,420		159,832
Total revenues	342,231		339,882		941,370		900,151

Costs and expenses
Location operating costs, excluding depreciation and amortization	99,724		92,568		297,217		261,490
Location payroll and benefit costs	80,795		75,617		233,921		213,929
Location food and beverage costs	26,826		27,627		72,716		71,382
Selling, general and administrative expenses, excluding depreciation and amortization	35,566		41,242		109,983		110,437
Depreciation and amortization	32,145		40,325		95,762		116,426
Loss on impairment and disposal of fixed assets, net	1,507		648		5,220		4,695
Other operating expense (income), net	41		(330)		(649)		(212)
Total costs and expenses	276,604		277,697		814,170		778,147

Operating income	65,627		62,185		127,200		122,004

Other (income) expenses
Interest expense, net	50,740		49,414		154,253		146,879
Change in fair value of earnout liability	(7,740)		(18,886)		(31,186)		(87,489)
Other expense	3		17		4,934		817
Total other expense	43,003		30,545		128,001		60,207

Income (loss) before income tax expense (benefit)	22,624		31,640		(801)		61,797

Income tax expense (benefit)	5,773		18,348		8,802		(2,897)
Net income (loss)	16,851		13,292		(9,603)		64,694

Series A preferred stock dividends	(2,473)		(2,313)		(7,245)		(6,767)
Earnings allocated to Series A preferred stock	(1,018)		(712)		—		(3,662)
Net income (loss) attributable to common stockholders	$	13,360	$	10,267	$	(16,848)	$	54,265

Net income (loss) per share attributable to Class A and B common stockholders
Basic	$	0.10	$	0.07	$	(0.12)	$	0.38
Diluted	$	0.10	$	0.07	$	(0.12)	$	0.36
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders
Basic	135,683,635		141,185,986		137,191,017		143,630,881
Diluted	139,063,980		147,606,436		137,191,017		150,982,706

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Condensed Consolidated Statements of Comprehensive (Loss) Income

(Amounts in thousands)

(Unaudited)


	Three Months Ended				Nine Months Ended
	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Net income (loss)	$	16,851	$	13,292	$	(9,603)	$	64,694
Other comprehensive income (loss), net of income tax:
Unrealized gain (loss) on derivatives	—		(139)		18		(536)
Foreign currency translation adjustment	370		219		1,175		(1,501)
Other comprehensive income (loss)	370		80		1,193		(2,037)
Total comprehensive income (loss)	$	17,221	$	13,372	$	(8,410)	$	62,657

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Condensed Consolidated Statements of Changes in Temporary Equity and Stockholders’ (Deficit) Equity

(Amounts in thousands, except share amounts)

(Unaudited)


	Series A preferred stock			Class A common Stock			Class B common Stock			Treasury stock			Additional Paid-in capital		Accumulated deficit		Accumulated other comprehensive income (loss)		Total stockholders’ deficit
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount
Balance, June 30, 2024	120,387	$	127,410	88,854,487	$	11	58,519,437	$	6	34,071,295	$	(385,015)	$	510,675	$	(303,159)	$	220	(177,262)
Net income	—	—		—	—		—	—		—	—		—		23,095		—		23,095
Foreign currency translation adjustment	—	—		—	—		—	—		—	—		—		—		(985)		(985)
Unrealized loss on derivatives	—	—		—	—		—	—		—	—		—		—		(709)		(709)
Settlement of Series A preferred stock	(3,300)	(3,492)		269,886	—		—	—		—	—		3,492		—		—		3,492
Share-based compensation	—	—		26,656	—		—	—		—	—		4,314		—		—		4,314
Cash dividends	—	—		—	—		—	—		—	—		(8,552)		—		—		(8,552)
Repurchase of Class A common stock into Treasury stock	—	—		(702,194)	—		—	—		702,194	(7,720)		—		—		—		(7,720)
Balance, September 29, 2024	117,087	$	123,918	88,448,835	$	11	58,519,437	$	6	34,773,489	$	(392,735)	$	509,929	$	(280,064)	$	(1,474)	$	(164,327)
Net income	—	—		—	—		—	—		—	—		—		28,307		—		28,307
Foreign currency translation adjustment	—	—		—	—		—	—		—	—		—		—		(735)		(735)
Unrealized gain on derivatives	—	—		—	—		—	—		—	—		—		—		312		312
Share-based compensation	—	—		317,374	—		—	—		—	—		3,374		—		—		3,374
Cash dividends	—	—		—	—		—	—		—	—		(8,473)		—		—		(8,473)
Repurchase of Class A common stock into Treasury stock	—	—		(3,334,976)	—		—	—		3,334,976	(38,116)		—		—		—		(38,116)
Balance, December 29, 2024	117,087	$	123,918	85,431,233	$	11	58,519,437	$	6	38,108,465	$	(430,851)	$	504,830	$	(251,757)	$	(1,897)	$	(179,658)
Net income	—	—		—	—		—	—		—	—		—		13,292		—		13,292
Foreign currency translation adjustment	—	—		—	—		—	—		—	—		—		—		219		219
Unrealized loss on derivatives	—	—		—	—		—	—		—	—		—		—		(139)		(139)
Share-based compensation	—	—		761,718	—		—	—		—	—		564		—		—		564
Settlement of equity awards	—	—		(1,747,434)	—		—	—		—	—		(16,244)		—		—		(16,244)
Cash dividends	—	—		—	—		—	—		—	—		(8,351)		—		—		(8,351)
Accrual of paid-in-kind dividends on Series A preferred stock	—	3,407		—	—		—	—		—	—		(3,407)		—		—		(3,407)
Repurchase of Class A common stock into Treasury stock	—	—		(1,943,340)	—		—	—		1,943,340	(20,005)		—		—		—		(20,005)
Balance, March 30, 2025	117,087	$	127,325	82,502,177	$	11	58,519,437	$	6	40,051,805	$	(450,856)	$	477,392	$	(238,465)	$	(1,817)	$	(213,729)

Table of Contents

Index to Notes


	Series A preferred stock			Class A common Stock			Class B common Stock			Treasury stock			Additional Paid-in capital		Accumulated deficit		Accumulated other comprehensive income (loss)		Total stockholders’ deficit
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount
Balance, June 29, 2025	117,087	$	127,325	81,684,310	$	12	58,519,437	$	6	40,868,233	$	(457,917)	$	472,889	$	(313,181)	$	(480)	(298,671)
Net loss	—	—		—	—		—	—		—	—		—		(13,798)		—		(13,798)
Foreign currency translation adjustment	—	—		—	—		—	—		—	—		—		—		199		199
Unrealized gain on derivatives	—	—		—	—		—	—		—	—		—		—		18		18
Accrual of paid-in-kind dividends on Series A preferred stock	—	3,502		—	—		—	—		—	—		(3,502)		—		—		(3,502)
Share-based compensation	—	—		35,674	—		—	—		—	—		3,334		—		—		3,334
Cash dividends	—	—		—	—		—	—		—	—		(8,195)		—		—		(8,195)
Repurchase of Class A common stock into Treasury stock	—	—		(563,184)	—		—	—		563,184	(5,679)		—		—		—		(5,679)
Balance, September 28, 2025	117,087	$	130,827	81,156,800	$	12	58,519,437	$	6	41,431,417	$	(463,596)	$	464,526	$	(326,979)	$	(263)	$	(326,294)
Net loss	—	—		—	—		—	—		—	—		—		(12,656)		—		(12,656)
Foreign currency translation adjustment	—	—		—	—		—	—		—	—		—		—		606		606
Share-based compensation	—	—		125,504	—		—	—		—	—		2,577		—		—		2,577
Cash dividends	—	—		—	—		—	—		—	—		(8,876)		—		—		(8,876)
Repurchase of Class A common stock into Treasury stock	—	—		(2,319,615)	—		—	—		2,319,615	(19,206)		—		—		—		(19,206)
Balance, December 28, 2025	117,087	$	130,827	78,962,689	$	12	58,519,437	$	6	43,751,032	$	(482,802)	$	458,227	$	(339,635)	$	343	$	(363,849)
Net income	—	—		—	—		—	—		—	—		—		16,851		—		16,851
Foreign currency translation adjustment	—	—		—	—		—	—		—	—		—		—		370		370
Share-based compensation	—	—		253,794	—		—	—		—	—		3,789		—		—		3,789
Cash dividends	—	—		—	—		—	—		—	—		(8,818)		—		—		(8,818)
Accrual of paid-in-kind dividends on Series A preferred stock	—	3,597		—	—		—	—		—	—		(3,597)		—		—		(3,597)
Repurchase of Class A common stock into Treasury stock	—	—		(1,029,437)	—		—	—		1,029,437	(7,516)		—		—		—		(7,516)
Balance, March 29, 2026	117,087	$	134,424	78,187,046	$	12	58,519,437	$	6	44,780,469	$	(490,318)	$	449,601	$	(322,784)	$	713	$	(362,770)

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Condensed Consolidated Statements of Cash Flows

(Amounts in thousands)

(Unaudited)


	Nine Months Ended
	March 29, 2026		March 30, 2025
Operating activities
Net (loss) income	$	(9,603)	$	64,694
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	95,762		116,426
Loss on impairment and disposal of fixed assets, net	5,220		4,695
Income from equity method investment	(220)		(226)
Amortization of deferred financing costs	6,618		2,844
Non-cash interest expense on finance lease obligation	8,679		8,166
Reduction of operating lease right of use assets	28,847		27,136
Non-cash portion of gain on lease modification	(1,441)		(144)
Deferred income taxes	4,200		(3,905)
Share-based compensation	9,312		17,955
Distributions from equity method investments	171		201
Change in fair value of earnout liability	(31,186)		(87,489)
Changes in assets and liabilities, net of business acquisitions:
Accounts receivable and notes receivable, net	1,011		1,205
Inventories	1,483		(2,009)
Prepaids, other current assets and other assets	(5,100)		(2,815)
Accounts payable and accrued expenses	31,822		23,837
Operating lease liabilities	(24,215)		(8,914)
Other current liabilities	(5,277)		(6,962)
Other long-term liabilities	(230)		72
Net cash provided by operating activities	115,853		154,767

Investing activities
Purchases of property and equipment	(90,097)		(117,502)
Purchases of previously leased assets	(246,795)		—
Purchases of intangible assets	(4,663)		—
Proceeds from sale of property and equipment	—		1,655
Acquisitions, net of cash acquired	(88,127)		(50,565)
Net cash used in investing activities	(429,682)		(166,412)

Table of Contents

Index to Notes


	Nine Months Ended
	March 29, 2026		March 30, 2025
Financing activities
Repurchase of Class A common stock into Treasury stock	$	(31,903)	$	(65,147)
Proceeds from share issuance	1,216		1,288
Settlement of equity awards	—		(21,053)
Payments for tax withholdings on share-based compensation	(814)		(6,155)
Payment of cash dividends	(25,889)		(25,375)
Payment of long-term debt	(1,279,927)		(6,891)
Proceeds from term loan	1,200,000		150,000
Proceeds from Senior Secured Notes	500,000		—
Proceeds from bridge term loan	230,000		—
Payment of bridge term loan	(230,000)		—
Payment on finance leases	(1,503)		(2,236)
Proceeds on finance leases	1,481		417
Proceeds from Revolver draws	210,000		110,000
Payoff of Revolver draws	(175,000)		(110,000)
Other financing, net	3,428		—
Purchases of previously leased assets	(61,651)		—
Payment of deferred financing costs	(27,130)		(923)
Net cash provided by financing activities	312,308		23,925

Effect of exchange rates on cash	489		(164)

Net (decrease) increase in cash and cash equivalents	(1,032)		12,116
Cash and cash equivalents at beginning of period	59,686		66,972
Cash and cash equivalents at end of period	$	58,654	$	79,088

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Table of Contents

Index to Notes

Lucky Strike Entertainment Corporation

Notes to Condensed Consolidated Financial Statements

(In thousands, except share and per share data)

(Unaudited)

(1) Description of Business and Significant Accounting Policies

Lucky Strike Entertainment Corporation, a Delaware corporation, and its subsidiaries (collectively referred to herein as the “Company,” “Lucky Strike Entertainment,” “Lucky Strike,” “we,” “us,” and “our”) is one of the world’s premier operators of location-based entertainment.

The Company operates location-based entertainment venues under several brand names. Our AMF and Bowl America branded locations are traditional bowling locations, while our Lucky Strike and Bowlero branded locations offer a more upscale entertainment experience with lounge seating, enhanced food and beverage offerings, and elevated customer service for both individuals and group events. The Company also operates other forms of location-based entertainment, including Octane Raceway, Raging Waves water park, Shipwreck Island water park, Big Kahuna’s water park, Wet ‘n Wild Emerald Pointe water park, Raging Waters Los Angeles water park, Castle Park and Boomers Parks locations. All of the Company’s locations are managed on a fully integrated and consistent basis, as all locations operate within the same business of location-based entertainment.

Basis of Presentation: The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been condensed or omitted. In the opinion of management, these financial statements contain all adjustments, consisting of normal recurring accruals, necessary to present fairly the financial position, results of operations and cash flows for the periods indicated. Our quarterly financial data should be read in conjunction with the audited financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended June 29, 2025.

Principles of Consolidation: The condensed consolidated financial statements and related notes include the accounts of Lucky Strike and the subsidiaries it controls. Control is determined based on ownership rights or, when applicable, based on whether the Company is considered to be the primary beneficiary of a variable interest entity. We use the equity method to account for investments in which we have the ability to exercise significant influence over the investee’s operating and financial policies, or in which we hold a partnership or limited liability company interest in an entity with specific ownership accounts, unless we have virtually no influence over the investee’s operating and financial policies. All significant intercompany balances and transactions have been eliminated in consolidation.

Segment Reporting: We manage our business activities on a consolidated basis and operate as a single operating segment: Location-based entertainment. The Company’s Chief Executive Officer, Thomas Shannon, is the Company’s chief operating decision maker (“CODM”). The CODM reviews the financial information presented on a consolidated basis since the Company provides its offerings and views key metrics, costs and margins similarly among our various location-based entertainment venues.

As a result, the CODM assesses performance and allocates resources based on net income (loss), as reported on our condensed consolidated statements of operations. The CODM manages and evaluates the results of the business in a consolidated manner to drive synergies and develop uniform strategies. Accordingly, key components and processes of the Company’s operations are centrally managed, including location acquisitions and development, customer service, marketing, human resources, finance and accounting, legal and government affairs. Segment asset information is not used by the CODM to allocate resources. The operating financial results along with significant segment expenses and other segment items are presented on the Company’s condensed consolidated statements of operations.

Use of Estimates: The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the balance sheets, statements of operations and accompanying notes. Significant estimates made by management include, but are not limited to, cash flow projections; the fair value of assets and liabilities in acquisitions; derivatives with hedge accounting; share-based compensation; depreciation and impairment of long-lived assets; carrying amount and recoverability analyses of property and equipment, assets held for sale, goodwill and other intangible assets; valuation of deferred tax assets and liabilities and income tax uncertainties; and reserves for litigation, claims and self-insurance costs. Actual results could differ from those estimates.

Change in Estimates: During the first quarter of fiscal year 2026, management conducted a review of the estimated useful lives of fixed assets due to operational changes, improved maintenance practices, and technological enhancements

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that are extending asset durability and reducing wear and tear. As a result of this review, the estimated useful lives were revised to better reflect their estimated future economic benefits.

The following table shows the impact of the changes in estimates:


	Three Months Ended		Nine Months Ended
	March 29, 2026		March 29, 2026
Decrease to depreciation expense	$	8,157	$	23,942
Increase to net income or decrease to net loss	8,157		23,942
Increase to net income or decrease to net loss per share	$	0.06	$	0.17

Fair-value Estimates: We have various financial instruments included in our financial statements. Financial instruments are carried in our financial statements at either cost or fair value. We estimate fair value of assets and liabilities using the following hierarchy using the highest level possible:

Level 1: Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities.

Level 2: Observable prices that are based on inputs not quoted on active markets, but are corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available.

Cash and Cash Equivalents: The Company considers all highly liquid investments with a maturity date of three months or less when purchased to be cash equivalents. The Company accepts a range of debit and credit cards, and these transactions are generally transmitted to a bank for reimbursement within 24 hours. The payments due from the banks for these debit and credit card transactions are generally received, or settled, within 24 to 48 hours of the transmission date. The Company considers all debit and credit card transactions that settle in less than seven days to be cash equivalents.

Prepaid Expenses and Other Current Assets: Prepaid expenses consist primarily of payments made for goods and services to be received in the near future. Prepaid expenses consist of sales tax, insurance premiums, deposits, and other costs.


	March 29, 2026		June 29, 2025
Prepaid expenses	$	25,104	$	17,731
Non-trade receivables	11,148		10,087
Other	2,031		1,548
Total prepaid expenses and other current assets	$	38,283	$	29,366

Equity Method Investments: The aggregate carrying amounts of our equity method investments was $25,890 and $25,841 as of March 29, 2026 and June 29, 2025, respectively, and are included as a component of Other Assets in our accompanying condensed consolidated balance sheets. Substantially all of our equity method investments consist of a limited partner interest in a subsidiary of VICI Properties Inc. (“VICI”). Equity method investments are adjusted to recognize (1) our share, based on percentage ownership or other contractual basis, of the investee’s net income or loss after the date of investment, (2) additional contributions made or distributions received, (3) amortization of the recorded investment that exceeds our share of the book value of the investee’s net assets, and (4) impairments resulting from other-than-temporary declines in fair value. Cash distributions received from our equity method investments are considered returns on investment and presented within operating activities in the condensed consolidated statement of cash flows to the extent of cumulative equity in net income of the investee. Additional distributions in excess of cumulative equity are considered returns of our investment and are presented as investing activities.

Derivatives: We are exposed to interest rate risk. To manage this risk, we entered into interest rate collar derivative transactions associated with a portion of our outstanding debt. The interest rate collars, which are designated for accounting purposes as cash flow hedges, establish a cap and floor on the Secured Overnight Financing Rate (SOFR). The Company's interest rate collars expire on March 31, 2026.

For financial derivative instruments that are designated as a cash flow hedge for accounting purposes, the effective portion of the gain or loss on the financial derivative instrument is reported as a component of other comprehensive income

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and reclassified into earnings in the same line item associated with the forecasted transaction, and in the same period or periods during which the forecasted transaction affects earnings. Gains and losses on the financial derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

The interest rate collar agreements effectively modified our exposure to interest rate risk by converting a portion of our interest payments on floating rate debt to include a cap and floor, thus reducing the impact of interest rate changes on future interest expense. See Note 7 - Debt for more information.

Net Income (Loss) Per Share Attributable to Common Stockholders: We compute net income (loss) per share of Class A common stock and Class B common stock under the two-class method. Holders of Class A common stock and Class B common stock have equal rights to the earnings of the Company. Our participating securities include the Series A preferred stock that have a non-forfeitable right to dividends in the event that a dividend is paid on common stock, but do not participate in losses, and thus are not included in a two-class method in periods of loss. In periods where the Company reports a net loss, all potentially dilutive securities are excluded from the calculation of the diluted net loss per share attributable to common stockholders as their effect is antidilutive and accordingly, basic and diluted net loss per share attributable to common stockholders will be the same. Dilutive securities include Series A preferred stock, earnouts, stock options, and restricted stock units (“RSUs”). See Note 14 - Net Income (Loss) Per Share.

Emerging Growth Company Status: The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with those of another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult because of the potential differences in accounting standards used. We will lose our emerging growth company status on June 28, 2026, which is the last day of the fiscal year following the fifth anniversary of Isos’ IPO (March 5, 2026).

Recently Issued Accounting Standards: In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (“Topic 740”): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures through the standardization and disaggregation of rate reconciliation categories and income taxes paid in both domestic and foreign jurisdictions. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 and is to be applied prospectively, with early adoption and retrospective application permitted. The Company adopted ASU 2023-09 in the first quarter of fiscal year 2026 and the adoption of this guidance will result in updates to annual disclosures to adhere to the new requirements, but will not otherwise have a significant impact on our consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires the disaggregation of certain expenses in the notes of the financials, to provide enhanced transparency into the expense captions presented on the face of the income statement. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027 and may be applied either prospectively or retrospectively. We are currently evaluating the impact of this standard to our consolidated financial statements.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal Use Software (“ASU 2025-06”), which will improve disclosures surrounding internal-use software and the timing of capitalization when companies use the incremental and iterative development method. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027 and is to be applied prospectively, with early adoption and retrospective application permitted. We are currently evaluating the impact of this standard to our consolidated financial statements.

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(2) Business Acquisitions

Acquisitions: The Company continually evaluates potential acquisitions, which can be either business combinations or asset purchases, that strategically fit within the Company’s overall growth strategy in order to expand our market share in key geographic areas and to improve our ability to leverage our fixed costs.

2026 Business Acquisitions: For business combinations, the Company allocates the consideration transferred to the identifiable assets acquired and liabilities assumed based on their preliminary estimated fair values as of the acquisition date. We estimate the fair values of the assets acquired and liabilities assumed using valuation techniques, such as the income, cost and market approaches. During the nine months ended March 29, 2026, the Company had two business acquisitions in which we acquired five locations for a total consideration of $88,127. The Company is still in the process of finalizing its valuation analyses for the business acquisition. The remaining fair value estimates include working capital, intangibles, property and equipment, and operating lease assets and liabilities. If necessary, for business combinations, we will continue to refine our estimates throughout the permitted measurement period, which may result in corresponding offsets to goodwill. We expect to finalize the valuations as soon as possible, but no later than one year after the respective acquisition dates.

The following table summarizes the preliminary purchase price allocations for the fair values of the identifiable assets acquired and liabilities assumed, components of consideration transferred and the transactional related expenses during the nine months ended March 29, 2026 using the acquisition method of accounting:


Identifiable assets acquired and liabilities assumed	Total
Current assets	$	1,708
Property and equipment	56,575
Operating lease right-of-use (“ROU”) assets	29,026
Identifiable intangible assets	8,670
Goodwill	41,631
Other assets	21
Total assets acquired	$	137,631

Current liabilities	$	(5,223)
Operating lease liabilities	(28,176)
Deferred income tax liability	(14,225)
Other liabilities	(1,880)
Total liabilities assumed	(49,504)
Total fair value, net of cash of $549	$	88,127

Components of consideration transferred
Cash	$	88,127
Total	$	88,127

(3) Goodwill and Other Intangible Assets

Goodwill:

The changes in the carrying amount of goodwill for the nine months ended March 29, 2026:


Balance as of June 29, 2025	$	844,351
Goodwill resulting from acquisitions during fiscal year 2026	41,631
Adjustments to preliminary fair values for prior year acquisitions	586
Balance as of March 29, 2026	$	886,568

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Intangible Assets:


	March 29, 2026						June 29, 2025
	Gross carrying amount		Accumulated amortization		Net carrying amount		Gross carrying amount		Accumulated amortization		Net carrying amount
Finite-lived intangible assets:
Bowlero trade name	$	14,870	$	(9,334)	$	5,536	$	14,870	$	(5,366)	$	9,504
Other acquisition trade names	1,890		(1,473)		417		2,510		(1,611)		899
Customer relationships	1,874		(1,496)		378		4,285		(3,541)		744
Management contracts	4,500		(403)		4,097		300		(300)		—
Non-compete agreements	3,284		(2,335)		949		3,724		(2,313)		1,411
PBA member, sponsor & media relationships	1,200		(735)		465		1,200		(651)		549
Other intangible assets	1,564		(692)		872		754		(519)		235
	29,182		(16,468)		12,714		27,643		(14,301)		13,342
Indefinite-lived intangible assets:
Liquor licenses	13,039		—		13,039		12,830		—		12,830
Lucky Strike trade name	8,360		—		8,360		8,360		—		8,360
Other trade names	18,890		—		18,890		11,030		—		11,030
	40,289		—		40,289		32,220		—		32,220
	$	69,471	$	(16,468)	$	53,003	$	59,863	$	(14,301)	$	45,562

The following table shows amortization expense for finite-lived intangible assets for each reporting period:


	Three Months Ended				Nine Months Ended
	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Amortization expense	$	2,409	$	1,774	$	5,922	$	5,528

(4) Property and Equipment

As of March 29, 2026 and June 29, 2025, property and equipment consists of:


	March 29, 2026		June 29, 2025
Land	$	244,347	$	139,389
Building and leasehold improvements	957,216		754,647
Equipment, software, furniture, and fixtures	703,701		645,200
Construction in progress	28,025		27,021
	1,933,289		1,566,257
Accumulated depreciation	(679,906)		(621,340)
Property and equipment, net of accumulated depreciation	$	1,253,383	$	944,917

The following table shows depreciation expense related to property and equipment for each reporting period:


	Three Months Ended				Nine Months Ended
	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Depreciation expense	$	26,955	$	34,184	$	81,618	$	97,817

(5) Leases

The Company leases various assets under non-cancellable operating and finance leases. These assets include location-based entertainment venues, office space, vehicles, and equipment.

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Most of our leases contain payments for some or all of the following: base rent, contingent rent, common area maintenance, insurance, real-estate taxes, and other operating expenses. Rental payments are subject to escalation depending on future changes in designated indices or based on pre-determined amounts agreed upon at lease inception.

On July 10, 2025, the Company acquired 58 existing properties that were previously under a master lease agreement with Carlyle for $306,000. Spanning 16 states, the 58 property portfolio includes prime locations in California, Illinois, Georgia, Arizona, and Colorado.

The following table summarizes the components of the net lease cost for each reporting period:


		Three Months Ended				Nine Months Ended
Lease Costs:	Location on Condensed Consolidated Statements of Operations	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Operating Lease Costs: (1)
Operating lease costs associated with master leases for locations	Primarily Location operating costs	$	3,678	$	4,427	$	11,126	$	13,283
Operating lease costs associated with non-master leases for locations	Primarily Location operating costs	16,140		15,970		49,124		46,266
Percentage rental costs for locations (2)	Primarily Location operating costs	1,949		1,760		5,781		4,817
Equipment and other operating lease costs (3)	Primarily Location operating costs	2,626		2,402		7,210		3,310
Total Operating Lease Costs:		24,393		24,559		73,241		67,676

Finance Lease Costs:
Amortization of right-of-use assets	Depreciation and amortization	2,781		4,367		8,222		13,081
Interest expense	Interest expense, net	7,621		12,427		22,969		37,214
Total Finance Lease Costs:		10,402		16,794		31,191		50,295

Financing Obligation Costs:
Interest expense	Interest expense, net	10,400		10,210		31,057		30,488
Total Financing Obligation Costs:		10,400		10,210		31,057		30,488

Other Costs, Net:
Variable occupancy costs (4)	Primarily Location operating costs	14,944		13,095		45,501		51,452
Loss (gain) from modifications to operating leases	Other operating expense (income), net	—		(144)		(1,441)		(144)
Other lease costs (5)	Primarily Location operating costs	104		213		754		482
Sublease income (6)	Revenues - Amusement & other	(1,194)		(1,163)		(3,617)		(3,563)
Total Other Costs, Net		13,854		12,001		41,197		48,227

Total Lease Costs, Net		$	59,049	$	63,564	$	176,686	$	196,686

(1)Operating lease costs includes both cash and non-cash expenses for operating leases. The operating lease costs associated with our locations are recognized evenly over the lease term, therefore, the timing of the expense may differ from the timing of actual cash payments. Cash payments and lease costs can differ due to (a) the timing of cash payments relative to the level expense, (b)

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non-cash adjustments as a result of purchase accounting, and (c) various other non-cash adjustments to lease costs. Please see the table below for cash paid for amounts included within our lease liabilities.

(2)Percentage rental costs for our locations primarily represents leases where we pay an extra rental amount based on a percentage of revenue in excess of predetermined revenue thresholds.

(3)Equipment and other operating lease costs primarily represents operating leases costs for equipment leases, common area maintenance charges, rent relief from the impacts of COVID-19, and other variable lease costs for operating leases where the lease payments escalate based on an index or rate.

(4)Variable occupancy costs primarily represents utilities, property insurance, and real estate taxes.

(5)Other lease costs primarily includes short-term lease costs and other variable payments for various equipment leases.

(6)Sublease income primarily represents short-term leases with pro-shops and various retail tenants.

Cash paid for amounts included in the measurement of lease liabilities for each reporting period:


	Nine Months Ended
	March 29, 2026		March 30, 2025
Cash paid for amounts included in the measurement of lease liabilities (1)

Operating leases:
Operating cash flows paid for operating leases	$	55,962	$	48,230
Total cash paid for operating lease liabilities	55,962		48,230

Finance leases:
Operating cash flows paid for interest portion of finance leases	20,472		35,190
Financing cash flows paid for principal portion of finance leases	1,503		2,236
Total cash paid for finance lease liabilities	21,975		37,426

Financing Obligations:
Operating cash flows paid for interest portion of financing obligations	24,682		24,264
Total cash paid for financing obligations:	24,682		24,264

Total cash amounts paid that are included in the measurement of lease liabilities: (2)	$	102,619	$	109,920

(1)This table includes cash paid for amounts included in the measurement of our lease liabilities. Since the lease liability only includes amounts that are contractually fixed, this table excludes cash paid for amounts that are variable in nature, such as utilities, common area maintenance, property insurance, real estate taxes, and percentage rent.

(2)For the period ended March 30, 2025, total cash amounts within the above table include deferred repayments of $2,013 for operating leases and $4,341 for finance leases. As of March 29, 2026, there were no deferred payments remaining.

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Supplemental balance sheet information related to leases was as follows:


	Condensed Consolidated Balance Sheets Location	March 29, 2026		June 29, 2025
Operating leases:
ROU Assets, net	Operating lease ROU assets, net	$	553,294	$	588,594
Lease liabilities, Short-term	Operating lease liabilities, ST	35,391		33,103
Lease liabilities, Long-term	Operating lease liabilities, LT	570,152		606,692

Finance leases:
ROU Assets, net	Finance lease ROU assets, net	302,322		507,701
Lease liabilities, Short-term	Other current liabilities	1,649		780
Lease liabilities, Long-term	Finance lease liabilities, LT	427,992		683,161

Financing Obligations:
Financing obligation, long-term	Long-term financing obligations	455,590		449,215

Lease incentive receivables from landlords of $1,580 and $3,975 as of March 29, 2026 and June 29, 2025, respectively, are reflected as a reduction of the operating and finance lease liability.

Other supplemental cash flow information related to leases was as follows for each reporting period:


	Nine Months Ended
	March 29, 2026		March 30, 2025
Supplemental Cash flow Information:
Operating Cash Flows from landlord contributions	$	1,817	$	8,389
Financing Cash Flows from landlord contributions	1,481		417
Purchases of operating lease assets	31,186		—
Purchases of operating lease liabilities	33,393		—
Purchases of finance lease assets	206,064		—
Purchases of finance lease liabilities	267,715		—

For the purchase of previously leased property, the Company treated the net difference between operating lease assets and liabilities as a reduction of operating cash flows on the purchase date. Similarly, the Company treated the net difference between finance lease assets and liabilities as a reduction of financing cash flows on the purchase date. The remainder of the purchase price is being allocated to investing cash outflows.

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(6) Accounts Payable and Accrued Expenses

As of March 29, 2026 and June 29, 2025, accounts payable and accrued expenses consist of:


	March 29, 2026		June 29, 2025
Accounts Payable	$	41,727	$	33,863
Customer deposits	32,223		12,811
Interest	26,933		9,164
Compensation	16,459		13,677
Deferred revenue	15,301		17,804
Taxes and Licenses	14,220		16,622
Insurance	14,046		13,288
Utilities	4,603		5,070
Professional fees	3,706		4,221
Other	14,405		18,668
Total accounts payable and accrued expenses	$	183,623	$	145,188

(7) Debt

The following table summarizes the Company’s debt structure as of March 29, 2026 and June 29, 2025:


	March 29, 2026		June 29, 2025
Term Loan (Maturing September 22, 2032 and bearing variable rate interest; 6.92% and 7.83% at March 29, 2026 and June 29, 2025, respectively)	$	1,200,000	$	1,279,116
7.25% Senior Secured Notes (Due October 15, 2032)	500,000		—
Revolver (Maturing September 22, 2030 and bearing variable rate interest; 6.42% and 6.93% at March 29, 2026 and June 29, 2025, respectively)	65,000		30,000
Other Equipment Loans	11,863		12,674
	1,776,863		1,321,790
Less:
Unamortized financing costs	(28,156)		(10,920)
Current portion of unamortized financing costs	3,569		3,947
Current maturities of long-term debt	(13,142)		(14,109)
Total long-term debt	$	1,739,134	$	1,300,708

Term Loan: On September 22, 2025, the Company entered into a Fifteenth Amendment (the “Fifteenth Amendment”) to the First Lien Credit Agreement. The Fifteenth Amendment provided for a refinanced $1,200,000 term loan maturing on September 22, 2032 (the “Term Loan”). The proceeds from the Term Loan, along with proceeds from the Notes (defined below), were used to fully repay outstanding borrowings under the First Lien Credit Agreement, including:

•$1,275,861 under the existing term loan

•$230,000 under the Bridge Term Loan (defined below)

•All outstanding borrowings under the Revolver (defined below)

The refinancing was accounted for as a non-substantial debt modification, resulting in no gain or loss.

The Term Loan is repaid on a quarterly basis in principal payments of $3,000 beginning on March 31, 2026. The Term Loan bears interest at a rate per annum equal to the Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus 3.25%, subject to a step down to 3.00% per annum at Total Leverage Ratio level of 2.90:1.00. Interest on the Term Loan is due on the last day of the interest period. The interest period, as agreed upon between the Company and its lenders, can be either one, three, or six months in length. As of March 29, 2026, the interest period is one month.

7.25% Senior Secured Notes: On September 22, 2025, the Company issued $500,000 aggregate principal amount of 7.25% Senior Secured Notes (the “Notes”). The Notes were issued pursuant to the indenture, also dated as of September

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22, 2025 (the “Indenture”). The Notes bear interest at the rate of 7.25% per annum and will mature on October 15, 2032. Interest on the Notes will be payable semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2026. The Indenture includes customary redemption provisions, including, among others, the right to redeem the Notes, in whole or in part, (1) prior to October 15, 2028, at a price equal to 100% of the principal amount thereof plus a “make-whole” premium, and (2) on or after October 15, 2028, at the redemption prices set forth in the Indenture.

Revolver: Under the First Lien Credit Agreement, the Company has access to a senior secured revolving credit facility (the “Revolver”). On July 16, 2025, the Company entered into a Fourteenth Amendment (the “Fourteenth Amendment”) to the First Lien Credit Agreement. The Fourteenth Amendment provided for a $50,000 increase of the Revolver commitment to an aggregate amount of $385,000.

In connection with the Fifteenth Amendment, the Revolver commitment was increased by $40,000 to an aggregate amount of $425,000, and the amount outstanding as of the effective date of the Fifteenth Amendment of $155,000 was repaid. Any outstanding balance on the Revolver is due on September 22, 2030. Interest on borrowings under the Revolver is based on the Adjusted Term SOFR. Borrowings under the Revolver bear interest at a rate per annum equal to SOFR plus 2.5%. Unused commitments under the Revolving Credit Facility incur initial commitment fees of 0.25%.

Bridge Term Loan: On July 10, 2025, the Company entered into a Thirteenth Amendment (the “Thirteenth Amendment”) to the First Lien Credit Agreement. The Thirteenth Amendment provided for a $230,000 bridge term loan (the “Bridge Term Loan”), which provided additional financing to acquire the Carlyle master lease agreement. The maturity date for the Bridge Term Loan is the date that is 364 days after July 10, 2025. The Bridge Term Loan bears interest at a rate per annum equal to the Adjusted Term SOFR plus 2.50%, which will increase by 0.50% on each of the 90th, 180th and 270th days after July 10, 2025. In connection with the Fifteenth Amendment, the Bridge Term Loan was repaid in full and no amounts are outstanding.

First Lien Credit Agreement Covenants: Obligations owed under the First Lien Credit Agreement are secured by a first priority security interest on substantially all assets of Lucky Strike and the guarantor subsidiaries. The First Lien Credit Agreement contains customary events of default, restrictions on indebtedness, liens, investments, asset dispositions, dividends and affirmative and negative covenants. The Company is subject to a financial covenant requiring that the First Lien Leverage Ratio (as defined in the First Lien Credit Agreement) not exceed 6.00:1.00 as of the end of any fiscal quarter if amounts outstanding on the Revolver exceed an amount equal to 40% of the aggregate Revolver commitment (subject to certain exclusions) at the end of such fiscal quarter. In addition, payment of borrowings under the Revolver may be accelerated if there is an event of default, and Lucky Strike would no longer be permitted to borrow additional funds under the Revolver while a default or event of default were outstanding.

7.25% Senior Secured Notes Covenants: The Notes are secured by substantially all of the assets of the Company and certain wholly owned subsidiaries of the Company. The Indenture contains customary restrictive covenants and events of default.

Letters of Credit: Outstanding standby letters of credit as of March 29, 2026 and June 29, 2025 totaled $24,122 and $22,422, respectively, and are guaranteed by JP Morgan Chase Bank, N.A. The available amount of the Revolver is reduced by the outstanding standby letters of credit.

Other Equipment Loan: On August 19, 2022, the Company entered into an equipment loan agreement for a principal amount of $15,350 with JP Morgan Chase Bank, N.A.. The loan matures August 19, 2029 and bears a fixed interest rate of 6.24%. The loan is repaid on a monthly basis in fixed payments of $153 plus a final payment at maturity. The loan obligation is secured by a lien on the equipment.

Covenant Compliance: The Company was in compliance with all debt covenants as of March 29, 2026.

Interest rate collars: The Company entered into two interest rate collars effective as of March 31, 2023 for an aggregate notional amount of our term loan of $800,000. The collar hedging strategy stabilizes interest rate fluctuations by setting both a floor and a cap. The hedge transactions have a trade and hedge designation date of April 4, 2023. The hedge transactions, each for a notional amount of $400,000, provide for interest rate collars. The interest rate collars establish a floor on SOFR of 0.9429% and 0.9355%, respectively, and a cap on SOFR of 5.50%. The interest rate collars had a maturity date of March 31, 2026.

The fair value of the collar agreements as of March 29, 2026 and June 29, 2025 was a liability of $0 and $16, respectively, and is included within the condensed consolidated balance sheets.

Since SOFR was within the collar cap and floor rates, there was no interest impact on the condensed consolidated statement of operations. Subsequent to the end of the quarter, the interest rate collars reached maturity and expired with a zero fair value, resulting in no income statement, OCI, or cash flow impact.

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(8) Income Taxes

For interim periods, the Company generally uses the estimated annual effective tax rate (“AETR”) method to calculate its income tax provision based on the current estimate of its AETR plus the tax effect of discrete items occurring during the period. The estimated AETR is based on forecasted annual results which may fluctuate due to significant changes in the forecasted or actual results and any other transaction that results in differing tax treatment.

For the three and nine months ended March 29, 2026, the Company departed from the estimated AETR method and computed its provision for income taxes using the discrete effective tax rate method (the “discrete method”), as allowed under ASC Topic 740, Income Taxes - Interim Reporting. The discrete method is applied when the application of the estimated AETR is impractical because it is not possible to reliably estimate the AETR. The discrete method treats the year-to-date period as if it was the annual period and determines the income tax expense or benefit on that basis. We believe that, at this time, the use of this discrete method is more appropriate than the AETR method as our full-year forecasted pre-tax income, relative to our forecasted permanent differences, has the potential to distort our estimated AETR.

The Company’s effective tax rate for the nine months ended March 29, 2026 was (1,099)%, which differs from the US federal statutory rate of 21% primarily due to state taxes incurred relating to the repurchase of the 58 properties under the Carlyle master lease agreement, the change in fair value of the earnout liability, increase to the valuation allowance against the deferred tax asset for business interest expense that cannot be deducted under IRC Section 163(j), permanent differences, and other discrete tax items. The Company’s effective tax rate for the nine months ended March 30, 2025 was (5)%, which differs from the US federal statutory rate of 21% due to the change in fair value of the earnout liability, permanent differences, and other discrete tax items.

On July 4, 2025, the U.S. government enacted The One Big Beautiful Bill Act of 2025. The most significant impact to the Company under the bill was the permanent reinstatement of bonus depreciation on qualified property and modifications to the calculation for excess business interest expense limitation under IRC Section 163(j) to the current tax estimate. The Company will continue to monitor the potential impacts of the bill on the Company’s consolidated financial statements.

(9) Commitments and Contingencies

From time to time, we are involved in various inquiries, investigations, claims, lawsuits and other legal proceedings that are incidental to the conduct of our business. These matters typically involve claims from customers, employees or other third parties involved in operational issues common to the retail, restaurant and entertainment industries. Such matters typically represent actions with respect to contracts, intellectual property, taxation, employment, employee benefits, personal injuries and other matters. A number of such claims may exist at any given time and there are currently a number of claims and legal proceedings pending against us. While it is not feasible to predict the outcome of all claims and legal proceedings and exposures with certainty, management believes that their ultimate disposition should not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.

(10) Earnouts

There were 11,417,982 and 11,418,291 unvested earnout shares outstanding as of March 29, 2026 and June 29, 2025, respectively.

The outstanding unvested earnout shares will vest if the closing share price of Lucky Strike’s Class A common stock equals or exceeds $17.50 per share for any 10 trading days within any consecutive 20 trading day period that occurs from December 15, 2021 through December 15, 2026.

All but 33,500 earnout shares are classified as a liability and changes in the fair value of the earnout shares are recognized in the statement of operations. Those earnout shares not classified as a liability are classified as equity compensation to employees and recognized as compensation expense on a straight-line basis over the expected term or upon the contingency being met.

See Note 11 - Fair Value of Financial Instruments for a summary of changes in the estimated fair value of the earnout shares for the periods ended March 29, 2026 and March 30, 2025.

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(11) Fair Value of Financial Instruments

Debt

The fair value and carrying value of our debt as of March 29, 2026 and June 29, 2025 are as follows:


	March 29, 2026		June 29, 2025
Carrying value	$	1,776,863	$	1,321,790
Fair value	1,674,863		1,316,993

The fair value of our debt is estimated based on trading levels of lenders buying and selling their participation levels of funding (Level 2).

There were no transfers in or out of any of the levels of the valuation hierarchy during the three and nine months ended March 29, 2026 and the fiscal year ended June 29, 2025.

Items Measured at Fair Value on a Recurring Basis

The Company holds certain assets and liabilities that are required to be measured at fair value on a recurring basis. The following table is a summary of fair value measurements and hierarchy level as of March 29, 2026 and June 29, 2025:


	March 29, 2026
	Level 1		Level 2		Level 3		Total
Earnout shares	$	—	$	—	$	5,009	$	5,009
Total liabilities	$	—	$	—	$	5,009	$	5,009


	June 29, 2025
	Level 1		Level 2		Level 3		Total
Interest rate collars	$	—	$	16	$	—	$	16
Earnout shares	—		—		36,183		36,183
Total liabilities	$	—	$	16	$	36,183	$	36,199

The fair value of earnout shares was estimated using a Monte Carlo simulation model (level 3 inputs). The key inputs into the Monte Carlo simulation as of March 29, 2026 were as follows:


	Earnout
Expected term in years	0.71
Expected volatility	50%
Risk-free interest rate	3.76%
Stock price	$	7.93
Dividend yield	3.03%

The following table sets forth a summary of changes in the estimated fair value of the Company's Level 3 Earnout liability for the three months ended March 29, 2026 and March 30, 2025:


	Three Months Ended				Nine Months Ended
	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Balance as of beginning of period	$	12,748	$	69,058	$	36,183	$	137,636
Issuances	1		—		12		25
Changes in fair value	(7,740)		(18,886)		(31,186)		(87,489)
Balance as of end of period	$	5,009	$	50,172	$	5,009	$	50,172

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Other Financial Instruments

Other financial instruments include cash and cash equivalents, accounts and notes receivable, accounts payable and accrued expenses. The financial statement carrying amounts of these items approximate the fair value due to their short duration.

(12) Common Stock, Preferred Stock and Stockholders’ Equity

The Company is authorized to issue three classes of stock to be designated, respectively, Class A common stock, Class B common stock (together with Class A common stock, the “Common Stock”) and Series A preferred stock (the “Preferred Stock”). The total number of shares of capital stock which the Company shall have authority to issue is 2,400,000,000, divided into the following:

Class A common stock:

•Authorized: 2,000,000,000 shares, with a par value of $0.0001 per share as of March 29, 2026 and June 29, 2025.

•Issued and Outstanding: 78,187,046 shares (inclusive of 1,574,946 shares contingent on certain stock price thresholds but excluding 44,780,469 shares held in treasury) as of March 29, 2026 and 81,684,310 shares (inclusive of 1,581,366 shares contingent on certain stock price thresholds but excluding 40,868,233 shares held in treasury) as of June 29, 2025.

Class B common stock:

•Authorized: 200,000,000 shares, with a par value of $0.0001 per share as of March 29, 2026 and June 29, 2025.

•Issued and Outstanding: 58,519,437 shares as of March 29, 2026 and June 29, 2025.

Preferred Stock:

•Authorized: 200,000,000 shares, with a par value of $0.0001 per share as of March 29, 2026 and June 29, 2025.

•Issued and Outstanding: 117,087 shares as of March 29, 2026 and June 29, 2025.

Series A Preferred Stock

Dividends accumulate on a cumulative basis on a 360-day year commencing from the issue date. The dividend rate is fixed at 5.5% per annum on a liquidation preference of $1,000 per share. Payment dates are June 30 and December 31 of each year with a record date of June 15 for the June 30 payment date and December 15 for the December 31 payment date. Declared dividends will be paid in cash if the Company declares the dividend to be paid in cash. If the Company does not pay all or any portion of the dividends that have accumulated as of any payment date, then the dollar amount of the dividends not paid in cash will be added to the liquidation preference and deemed to be declared and paid in-kind. For the nine months ended March 29, 2026, accumulated dividends in the amount of $7,099 were added to the liquidation preference and deemed to be declared and paid in-kind. For the nine months ended March 29, 2026, dividends in the amount of $5,445 were accumulated on the Preferred Stock.

Stock Dividend

Common stock dividends paid during the nine months ended March 29, 2026 is as follows:

Declaration Date

Record Date

Payment Date

Amount (1)

August 19, 2025

August 29, 2025

September 12, 2025

8,183

November 4, 2025

November 24, 2025

December 8, 2025

8,844

February 3, 2026

February 20, 2026

March 6, 2026

8,756

25,783

(1)Amounts include dividends paid to holders of Series A preferred stock on an as-converted basis. The amounts do not reflect amounts paid for accrued dividends on previously unvested share-based awards or amounts accrued for currently unvested share-based awards.

On May 5, 2026, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.06 per share of common stock, which will be paid on June 5, 2026, to stockholders of record on May 22, 2026.

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Share Repurchase Program

On February 7, 2022, the Company announced that its Board of Directors authorized a share repurchase program providing for repurchases of up to $200,000 of the Company’s outstanding Class A common stock through February 3, 2024. On each of May 15, 2023, September 6, 2023 and February 2, 2024, the Board of Directors authorized a replenishment of then-remaining balance of the share repurchase program to $200,000, which in aggregate increased the total amount that has been authorized under the share repurchase program to approximately $551,518. On February 2, 2024, the Board of Directors extended the share repurchase program indefinitely. Treasury stock purchases are stated at cost and presented as a reduction of equity on the condensed consolidated balance sheets. Repurchases of shares are made in accordance with applicable securities laws and may be made from time to time in the open market or by negotiated transactions. The amount and timing of repurchases are based on a variety of factors, including stock price, regulatory limitations, debt agreement limitations, and other market and economic factors. The share repurchase program does not require the Company to repurchase any specific number of shares, and the Company may terminate the repurchase program at any time.

For the nine months ended March 29, 2026, 3,912,236 shares of Class A common stock were repurchased for a total of $32,116, for an average purchase price per share of $8.21. As of March 29, 2026, the Company had $60,106 remaining under its current share repurchase authorization.

(13) Share-Based Compensation

The Company has two stock plans: the Lucky Strike Entertainment Corporation 2021 Omnibus Incentive Plan (“2021 Plan”) and the Lucky Strike Entertainment Corporation Employee Stock Purchase Plan (“ESPP”). These stock incentive plans are designed to attract and retain key personnel by providing them the opportunity to acquire an equity interest in the Company and align the interest of key personnel with those of the Company’s stockholders.

As of March 29, 2026 and June 29, 2025, the total share-based compensation cost not yet recognized is as follows:


	Award Plan	March 29, 2026		June 29, 2025
Stock options	2021 Plan	$	8,111	$	11,976
Service based RSUs	2021 Plan	5,643		5,286
Market and service based RSUs	2021 Plan	10,207		5,988
Earnout RSUs	2021 Plan	38		92
ESPP	ESPP	276		276
Total unrecognized share-based compensation cost		$	24,275	$	23,618

Share-based compensation recognized in the condensed consolidated statements of operations for the periods ended March 29, 2026 and March 30, 2025 is as follows:


		Three Months Ended				Nine Months Ended
	Award Plan	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Stock options	2021 Plan	$	1,247	$	2,063	$	4,459	$	7,588
Service based RSUs	2021 Plan	1,149		1,089		3,090		3,466
Market and service based RSUs	2021 Plan	523		684		1,541		1,328
Earnout RSUs	2021 Plan	(2)		16		4		40
Other share-based awards & settlements (1)	2021 Plan	—		4,809		—		5,249
ESPP	ESPP	76		127		218		284
Total share-based compensation expense		$	2,993	$	8,788	$	9,312	$	17,955

(1) Consists of the impact of the $21,053 cash settlement of 1,747,434 shares of Class A common stock and 773,753 stock options as part of an employment separation agreement with a long-time executive and Director of the Company during the period ended March 30, 2025, which resulted in an equity charge of $16,244 within Additional paid-in capital and share-based compensation expense within Selling, general, and administrative expenses of $4,809. The settled Class A common stock and stock options were then cancelled.

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The Company did not have any recognized income tax benefits, net of valuation allowances, related to our share-based compensation plans.

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(14) Net Income (Loss) Per Share

The computations of basic and diluted net income (loss) per share of Class A common stock and Class B common stock are as follows:


	Three Months Ended - Basic
	March 29, 2026						March 30, 2025
	Class A		Class B		Total		Class A		Class B		Total
Numerator
Net income allocated to common stockholders	$	7,598	$	5,762	$	13,360	$	6,011	$	4,256	$	10,267

Denominator
Weighted-average shares outstanding	77,164,198		58,519,437		135,683,635		82,666,549		58,519,437		141,185,986

Net income per share, basic	$	0.10	$	0.10	$	0.10	$	0.07	$	0.07	$	0.07


	Three Months Ended - Diluted
	March 29, 2026						March 30, 2025
	Class A		Class B		Total		Class A		Class B		Total
Numerator
Net income allocated to common stockholders	$	7,598	$	5,762	$	13,360	$	6,011	$	4,256	$	10,267

Denominator
Weighted-average shares outstanding	77,164,198		58,519,437		135,683,635		82,666,549		58,519,437		141,185,986
Impact of incremental shares	1,043,255		2,337,090		3,380,345		1,250,628		5,169,822		6,420,450
Total	78,207,453		60,856,527		139,063,980		83,917,177		63,689,259		147,606,436

Net income per share, diluted	$	0.10	$	0.09	$	0.10	$	0.07	$	0.07	$	0.07


	Nine Months Ended - Basic
	March 29, 2026						March 30, 2025
	Class A		Class B		Total		Class A		Class B		Total
Numerator
Net (loss) income allocated to common stockholders	$	(9,661)	$	(7,187)	$	(16,848)	$	32,156	$	22,109	$	54,265

Denominator
Weighted-average shares outstanding	78,671,580		58,519,437		137,191,017		85,111,444		58,519,437		143,630,881

Net (loss) income per share, basic	$	(0.12)	$	(0.12)	$	(0.12)	$	0.38	$	0.38	$	0.38

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	Nine Months Ended - Diluted
	March 29, 2026						March 30, 2025
	Class A		Class B		Total		Class A		Class B		Total
Numerator
Net (loss) income allocated to common stockholders	$	(9,661)	$	(7,187)	$	(16,848)	$	32,156	$	22,109	$	54,265

Denominator
Weighted-average shares outstanding	78,671,580		58,519,437		137,191,017		85,111,444		58,519,437		143,630,881
Impact of incremental shares	*		*		*		1,295,413		6,056,412		7,351,825
Total	78,671,580		58,519,437		137,191,017		86,406,857		64,575,849		150,982,706

Net (loss) income per share, diluted	$	(0.12)	$	(0.12)	$	(0.12)	$	0.37	$	0.34	$	0.36

Anti-dilutive shares excluded from diluted calculation*					14,718,118

*The impact of potentially dilutive convertible Preferred Stock, service based RSUs, market and service based RSUs, stock options, and purchases of shares under our ESPP were excluded from the diluted per share calculations because they would have been antidilutive

The impact from incremental shares for our diluted per share calculations are as follows:


	Three Months Ended
	March 29, 2026			March 30, 2025
	Class A	Class B	Total	Class A	Class B	Total
Service based RSUs	84,691	—	84,691	661,886	—	661,886
Market and service based RSUs	908,391	—	908,391	510,861	—	510,861
Stock options	11,226	2,337,090	2,348,316	30,381	5,169,822	5,200,203
ESPP	38,947	—	38,947	47,500	—	47,500
Total	1,043,255	2,337,090	3,380,345	1,250,628	5,169,822	6,420,450


	Nine Months Ended
	March 29, 2026			March 30, 2025
	Class A	Class B	Total	Class A	Class B	Total
Service based RSUs	139,120	—	139,120	661,886	—	661,886
Market and service based RSUs	908,391	—	908,391	510,861	—	510,861
Stock options	16,324	3,413,893	3,430,217	75,166	6,056,412	6,131,578
ESPP	38,947	—	38,947	47,500	—	47,500
Series A Preferred Stock	10,201,443	—	10,201,443	—	—	—
Total	11,304,225	3,413,893	14,718,118	1,295,413	6,056,412	7,351,825

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(15) Supplemental Cash Flow Information


	March 29, 2026		March 30, 2025
Cash paid during the period for:
Interest (1)	$	123,417	$	129,066
Income taxes, net of refunds	7,770		1,848
Noncash investing and financing transactions:
Capital expenditures in accounts payable and accrued expenses	14,706		14,476
Change in fair value of interest rate swap, net of tax	18		(536)
Accrual of paid-in-kind dividends on Series A preferred stock	7,099		3,407
Excise tax liability accrued on stock repurchases	285		693
Unsettled treasury stock trade payable	213		—

(1) Includes cash paid for the interest portion on finance leases and financing obligations. See Note 5 - Leases for supplementary information relating to leasing transactions.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

This discussion should be read in conjunction with Lucky Strike Entertainment’s unaudited condensed consolidated financial statements and the related notes in Item 1 and with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended June 29, 2025 as filed with the Securities and Exchange Commission (“SEC”) on August 28, 2025. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 29, 2025. Actual results may differ materially from those contained in any forward-looking statements. All period references are to our fiscal periods unless otherwise indicated. Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we,” “us,” “our,” the “Company,” “Lucky Strike Entertainment,” and “Lucky Strike” are intended to mean the business and operations of Lucky Strike Entertainment Corporation and its consolidated subsidiaries. All financial information in this section is presented in thousands, unless otherwise noted, except share and per share amounts.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements regarding, among other things, the plans, strategies and prospects, both business and financial of Lucky Strike. These statements are based on the beliefs and assumptions of our management. Although we believe that our plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that it will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, statements about our business strategy, financial projections, anticipated growth and market opportunities.

These forward-looking statements are based on information available as of the date of this Quarterly Report on Form 10-Q, and current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

In addition, statements that we “believe,” and similar statements reflect only our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and these statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

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As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Factors that could cause our actual results to differ include those described under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 29, 2025.

Overview

Lucky Strike Entertainment is one of the world’s premier operators of location-based entertainment. The Company operates traditional bowling locations under its AMF and Bowl America brands, as well as more upscale entertainment venues under its Lucky Strike and Bowlero brands, featuring lounge seating, arcades, enhanced food and beverage offerings, and elevated customer service for both individuals and group events. The Company also hosts and oversees professional and non-professional bowling tournaments and related broadcasting activities. In addition, the Company operates other forms of location-based entertainment, including family entertainment centers (“FECs”) and water parks, under brands including Octane Raceway, Raging Waves, Shipwreck Island, Big Kahuna’s, Wet ‘n Wild Emerald Pointe, Raging Waters Los Angeles, Castle Park, and Boomers Parks.

The Company remains focused on creating long-term shareholder value through continued organic growth, the conversion and upgrading of existing locations to more upscale entertainment experiences offering a broader range of offerings, the opening of new locations and strategic acquisitions.

Recent Developments

During the nine months ended March 29, 2026, Lucky Strike Entertainment continued to execute on its long-term growth strategy, delivering total revenue growth of 5% and further expanding its three core verticals: bowling, water parks, and FECs. The following summarizes the Company’s significant developments during the period:

•Property Acquisition from Carlyle: The Company acquired 58 existing properties that were previously subject to a master lease agreement with Carlyle for aggregate consideration of $306,000. The acquired portfolio spans 16 states and includes prime locations in California, Illinois, Georgia, Arizona, and Colorado. This transaction reduced annual rent obligations by eliminating the associated lease liabilities, while providing meaningful financial and operational flexibility in support of the Company's long-term growth strategy.

•Water Park and FEC Acquisitions: The Company completed the acquisitions of Wet ‘n Wild Emerald Pointe water park, Raging Waters Los Angeles water park, Castle Park, and two additional Boomers Parks locations, further expanding the Company’s water park and FEC portfolio.

•New Location Opening: The Company completed construction of and opened a newly built Lucky Strike entertainment location in Southern California during the period.

•Lucky Strike Rebrand Initiative: The Company continued to make meaningful progress on the Lucky Strike rebrand initiative with an additional 66 locations converted. As of March 29, 2026, we had 110 Lucky Strike locations.

•Debt Refinancing: The Company refinanced its existing term loan with a new $1,200,000 term loan, issued $500,000 aggregate principal amount of 7.25% Senior Secured Notes, and increased its revolving credit facility commitment to $425,000. Management believes this refinancing strengthens the Company's balance sheet and provides enhanced financial flexibility to support ongoing growth initiatives.

Trends

There are a number of factors that could materially affect our future profitability, including changing economic conditions with the resulting impact on our sales, profitability, and capital spending, changes in our debt levels and applicable interest rates, and increasing prices of labor and inventory, which includes food and beverage costs. For example, the Company continues to monitor the impacts of various macroeconomic trends, such as inflationary pressure, changes in monetary policy, decreasing consumer confidence and spending, and the introduction of or changes in tariffs. The Company also monitors geopolitical developments, including the ongoing conflict involving Iran and related regional instability, which have contributed to volatility in global energy markets, supply chain disruptions, and broader macroeconomic uncertainty. Such changes in macroeconomic conditions may lead to increased costs for the business. Furthermore, these macroeconomic and geopolitical trends could adversely affect the Company’s customers, which could impact their willingness to visit the Company’s locations, which could harm the financial results. Additionally, sales and

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results of operations could be impacted by acquisitions and restructuring projects. Restructuring can include various projects, including closure of locations not performing well, cost reductions through staffing reductions, and optimizing and allocating resources to improve profitability.

Our operating results fluctuate seasonally. For our bowling locations, we typically generate our highest sales volumes during the third quarter of each fiscal year due to the timing of leagues, holidays and changing weather conditions. For our FEC and water park locations, we typically generate our highest sales volumes during the fourth and first quarters of our fiscal year due to more favorable weather conditions and the timing of operating seasons. School operating schedules, holidays and weather conditions may also affect our sales volumes in some operating regions differently than others. Because of the seasonal nature of our business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.

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Presentation of Results of Operations

The Company reports on a fiscal year, with each quarter generally comprised of one 5-week period and two 4-week periods.

Results of Operations

Three Months Ended March 29, 2026 Compared to the Three Months Ended March 30, 2025

Analysis of Consolidated Statement of Operations. The following table displays certain items from our condensed consolidated statements of operations for the periods presented below:


	Three Months Ended
	March 29, 2026		%(1)		March 30, 2025		%(1)		Change		% Change
Revenues
Bowling	$	164,590	48	%	$	159,756	47	%	$	4,834	3	%
Food & beverage	118,697		35	%	120,452		35	%	(1,755)		(1)	%
Amusement & other	58,944		17	%	59,674		18	%	(730)		(1)	%
Total revenues	342,231		100	%	339,882		100	%	2,349		1	%

Costs and expenses
Location operating costs, excluding depreciation and amortization	99,724		29	%	92,568		27	%	7,156		8	%
Location payroll and benefit costs	80,795		24	%	75,617		22	%	5,178		7	%
Location food and beverage costs	26,826		8	%	27,627		8	%	(801)		(3)	%
Selling, general and administrative expenses, excluding depreciation and amortization	35,566		10	%	41,242		12	%	(5,676)		(14)	%
Depreciation and amortization	32,145		9	%	40,325		12	%	(8,180)		(20)	%
Loss on impairment and disposal of fixed assets, net	1,507		—	%	648		—	%	859		*
Other operating expense (income), net	41		—	%	(330)		—	%	(371)		*
Total costs and expenses	276,604		81	%	277,697		82	%	(1,093)		—	%

Operating income	65,627		19	%	62,185		18	%	3,442		6	%

Other (income) expenses
Interest expense, net	50,740		15	%	49,414		15	%	1,326		3	%
Change in fair value of earnout liability	(7,740)		(2)	%	(18,886)		(6)	%	11,146		(59)	%
Other expense	3		—	%	17		—	%	(14)		(82)	%
Total other expense	43,003		13	%	30,545		9	%	12,458		41	%

Income before income tax expense	22,624		7	%	31,640		9	%	(9,016)		(28)	%

Income tax expense	5,773		2	%	18,348		5	%	(12,575)		(69)	%
Net income	$	16,851	5	%	$	13,292	4	%	3,559		27	%

___________

(1) Percent calculated as a percentage of revenues and may not total due to rounding.

*Represents a change equal to or in excess of 100% or one that is not meaningful.

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Revenues: For the quarter ended March 29, 2026, revenues totaled $342,231 and represented an increase of $2,349, or 1%, over the same period of last fiscal year. The increase is primarily attributable to newly acquired or opened locations.

The following table summarizes our revenues on a same-store-basis for the quarter ended March 29, 2026 as compared to the corresponding period last fiscal year:


	Three Months Ended
(in thousands)	March 29, 2026		March 30, 2025		Change		% Change
Revenues on a same-store basis (1)	$	332,523	$	331,952	$	571	—	%
Revenues for media, new and closed locations	9,137		7,294		1,843		25	%
Service fee revenue (2)	571		636		(65)		(10)	%
Total revenues	$	342,231	$	339,882	$	2,349	1	%

(1) Revenues from 360 locations are included in the same-store comparable location base for the comparison in the above table. In our previously filed Form 10-Q for the three months ended March 30, 2025, revenues from 348 locations were included in the same-store revenue.

(2) Service fee revenue is a mandatory gratuity passed through to the employee, which is a non-contributor to earnings and is being phased out across our locations.

Same-store revenues includes revenue from locations that are open in periods presented (open in both the current period and the prior period being reported) and excludes revenues from locations that are not open in periods presented such as acquired new locations or locations closed for upgrades, renovations or other such reasons, as well as media revenues and service fee revenues.

Same-store revenues remained relatively flat during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. Within the quarter, walk-in bowling entertainment revenues and food and non-alcoholic beverage revenues at same-store bowling entertainment locations remained strong, contributing approximately $7,400 of incremental same-store revenues during the period. This strength was partially offset by combined declines in same-store alcoholic beverage revenues and amusement and other revenues, resulting in overall same-store revenue stability for the quarter. Results were impacted by significant adverse weather during the quarter, including Winter Storm Fern in January 2026, which brought severe winter conditions across a significant portion of our markets, and separate adverse weather conditions across portions of our markets in February and March 2026. Management believes these weather events negatively impacted customer traffic at certain locations during those periods. Additionally, consumer confidence declined in March 2026, which management believes was driven in part by rising energy prices and broader macroeconomic uncertainty stemming from geopolitical tensions in the Middle East, including the ongoing conflict with Iran. These conditions contributed to increased volatility in fuel costs and adversely impacted consumer spending patterns during the period.

Location operating costs: Location operating costs primarily consist of rent, utilities, insurance, repairs & maintenance, property taxes, supplies, marketing, and other costs associated with Company locations. Location operating costs include both fixed and variable components and therefore do not directly correlate with revenue.

Location operating costs increased $7,156, or 8%, during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. Increases were broad-based across most cost categories, including amusement costs, marketing, property taxes, insurance, and utilities. The overall increase was primarily driven by location count growth and strategic operational initiatives, as further described below.

Water park and FEC locations contributed approximately $3,200 to the increase over the comparable period, and new bowling locations contributed approximately $590. In addition, marketing expense increased approximately $2,300 compared to the prior year period, reflecting management's initiative to increase marketing investment. Management believes the increased marketing spend supported retail entertainment revenue performance during the quarter, notwithstanding the adverse weather and consumer confidence headwinds discussed above. Marketing expense decreased approximately $1,300 compared to the immediately preceding quarter as we became more disciplined in deploying our marketing budget during the current quarter.

Location operating costs as a percent of revenues increased from 27% to 29% during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. The increase as a percentage of revenues is primarily attributable

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to the FEC and water park locations within our portfolio, which typically generate their highest sales volumes during the fourth and first quarters of our fiscal year due to favorable weather conditions and the timing of their operating seasons. As a result, location operating costs for these locations tend to increase at a higher rate than revenues during the second and third quarters of our fiscal year, consistent with the seasonal pattern observed in the current period.

Notwithstanding the year-over-year increase, location operating costs as a percent of revenues improved sequentially from 33% in the first quarter of fiscal 2026 to 32% in the second quarter of fiscal 2026 to 29% in the current quarter, reflecting the Company's ongoing efforts to optimize location-level cost efficiency.

Location payroll and benefit costs: Location payroll and benefit costs consist of employee costs that directly support location operations. Location payroll and benefit costs increased $5,178, or 7%, during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. The increase is primarily driven by location count growth, additional bonus incentives, and an overall increase in labor hours per location. Water park and FEC locations had a significant impact, contributing approximately $2,400 to the increase over the comparable period. The remaining increase reflects higher labor hours and bonus incentive costs across existing same-store locations during the period.

Location food & beverage costs: Location food & beverage costs as a percentage of food & beverage revenue remained flat at 23%. Location food & beverage costs decreased $801, or 3%. The decrease in location food & beverage costs is mainly attributable to decreased food & beverage revenue as compared to the same period of the prior fiscal year.

Selling, general and administrative expenses (“SG&A”): SG&A expenses decreased $5,676 or 14%, during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. The decrease was primarily driven by a $5,800 reduction in share-based compensation expense, reflecting a non-recurring charge of $4,809 in the prior year period associated with the settlement of equity awards in connection with the retirement of a long-time executive of the Company. The decreases were partially offset by an increase of $553 in severance expense incurred during the current quarter in connection with reductions to corporate headcount.

Depreciation and amortization: Depreciation and amortization decreased $8,180 or 20%, during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. The decrease primarily reflects the impact of a change in the estimated useful lives of certain fixed assets, which resulted in a reduction in depreciation expense of approximately $8,157 during the quarter.

Interest expense, net: Interest expense primarily relates to interest on debt, finance leases, and financing obligations. Interest expense increased $1,326, or 3%, during the quarter ended March 29, 2026 compared to the same period of the prior fiscal year. The increase is primarily attributable to higher debt levels relative to the third quarter of fiscal 2025, driven by two principal factors: (i) the issuance of the 7.25% Senior Secured Notes (the "Notes") late in the first quarter of fiscal 2026, and (ii) amounts outstanding on the Revolver during the quarter, where no such amounts were outstanding during the comparable prior year period. Interest on the Notes is payable semi-annually in arrears on April 15 and October 15 of each year. As of March 29, 2026, we had approximately $19,000 of accrued interest related to the Notes, of which approximately $9,200 was accrued during the third quarter of fiscal 2026. Interest expense on the Revolver increased approximately $1,000 as compared to the third quarter of fiscal 2025. These increases were partially offset by a $4,806 decrease in interest expense related to finance leases and a $4,300 decrease in interest expense related to term loan debt. The decrease in finance lease interest expense reflects the purchase of certain previously leased assets during the first quarter of fiscal 2026. The decrease in term loan debt interest expense reflects both lower outstanding principal balances and more favorable interest rates achieved in connection with the refinancing completed in the first quarter of fiscal 2026.

Change in fair value of earnouts: The impact on the statement of operations during the quarter ended March 29, 2026 is due to the decrease in the fair value of the earnouts. The decrease in the fair value of the earnouts is primarily driven by the decrease in the Company’s stock price and the limited remaining vesting period associated with the earnouts, which reduce the estimated probability of vesting.

Income tax expense: The income tax expense and deferred tax assets and liabilities reflect management’s assessment of the Company’s tax position. During the current year, the Company determined that its estimated AETR was not possible to reliably estimate due to the timing of results and the existence of a valuation allowance against interest limitation due to IRC Section 163(j). As a result, the Company utilized the discrete method. The effective tax rate of 26% for the quarter ended March 29, 2026 was primarily attributed to the change in fair value of the earnout liability, unrealizable Section 163(j) interest limitation, and permanent differences.

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Nine Months Ended March 29, 2026 Compared to the Nine Months Ended March 30, 2025

Analysis of Consolidated Statement of Operations. The following table displays certain items from our condensed consolidated statements of operations for the periods presented below:


	Nine Months Ended
	March 29, 2026		%(1)		March 30, 2025		%(1)		Change		% Change
Revenues
Bowling	$	432,727	46	%	$	420,926	47	%	$	11,801	3	%
Food & beverage	327,223		35	%	319,393		35	%	7,830		2	%
Amusement & other	181,420		19	%	159,832		18	%	21,588		14	%
Total revenues	941,370		100	%	900,151		100	%	41,219		5	%

Costs and expenses
Location operating costs, excluding depreciation and amortization	297,217		32	%	261,490		29	%	35,727		14	%
Location payroll and benefit costs	233,921		25	%	213,929		24	%	19,992		9	%
Location food and beverage costs	72,716		8	%	71,382		8	%	1,334		2	%
Selling, general and administrative expenses, excluding depreciation and amortization	109,983		12	%	110,437		12	%	(454)		—	%
Depreciation and amortization	95,762		10	%	116,426		13	%	(20,664)		(18)	%
Loss on impairment and disposal of fixed assets, net	5,220		1	%	4,695		1	%	525		11	%
Other operating (income) expense, net	(649)		—	%	(212)		—	%	(437)		*
Total costs and expenses	814,170		86	%	778,147		86	%	36,023		5	%

Operating income	127,200		14	%	122,004		14	%	5,196		4	%

Other (income) expenses
Interest expense, net	154,253		16	%	146,879		16	%	7,374		5	%
Change in fair value of earnout liability	(31,186)		(3)	%	(87,489)		(10)	%	56,303		(64)	%
Other expense	4,934		1	%	817		—	%	4,117		*
Total other expense	128,001		14	%	60,207		7	%	67,794		*

(Loss) income before income tax expense (benefit)	(801)		—	%	61,797		7	%	(62,598)		*

Income tax expense (benefit)	8,802		1	%	(2,897)		—	%	11,699		*
Net (loss) income	$	(9,603)	(1)	%	$	64,694	7	%	(74,297)		*

___________

(1) Percent calculated as a percentage of revenues and may not total due to rounding.

*Represents a change equal to or in excess of 100% or one that is not meaningful.

Revenues: For the nine months ended March 29, 2026, revenues totaled $941,370 and represented an increase of $41,219, or 5%, over the same period of last fiscal year. The increase in revenues is primarily attributable to revenue from newly acquired or leased locations.

The following table summarizes our revenues on a same-store-basis for nine months ended March 29, 2026 as compared to the corresponding period last fiscal year:

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	Nine Months Ended
(in thousands)	March 29, 2026		March 30, 2025		Change		% Change
Revenues on a same-store basis (1)	$	858,952	$	857,037	$	1,915	—	%
Revenues for media, new and closed locations	80,784		41,284		39,500		96	%
Service fee revenue (2)	1,634		1,830		(196)		(11)	%
Total revenues	$	941,370	$	900,151	$	41,219	5	%

(1) Revenues from 350 locations are included in the same-store comparable location base for the comparison in the above table. In our previously filed 10-Q for the nine months ended March 30, 2025, revenues from 327 locations were included in the same-store revenue.

(2) Service fee revenue is a mandatory gratuity passed through to the employee, which is a non-contributor to earnings and is being phased out across our locations.

Same-store revenues remained relatively flat during the nine months ended March 29, 2026 compared to the same period of the prior fiscal year, consistent with the relative flatness observed through the first half of fiscal 2026. Management believes the continued flatness in same-store revenues reflects the cumulative impact of the adverse weather conditions and consumer confidence headwinds experienced during the third quarter of fiscal 2026, as described above. Partially offsetting these headwinds, walk-in bowling entertainment revenue at same-store locations remained strong during the third quarter, contributing approximately $7,800 of incremental same-store revenues. This strength in walk-in business was partially offset by declines in our events business during the period.

Location operating costs: Location operating costs increased $35,727, or 14%, during the nine months ended March 29, 2026 compared to the same period of the prior fiscal year. Increases were broad-based across most cost categories, including amusement costs, marketing, rent, property taxes, insurance, and utilities. The overall increase was primarily driven by location count growth and strategic operational initiatives, as further described below.

Water park and FEC locations contributed approximately $13,600 to the increase over the comparable period, and new bowling locations contributed approximately $7,500. In addition, marketing expense increased approximately $9,500 compared to the prior year period, reflecting management's initiative to align marketing spend more closely with industry benchmarks. Management believes the increased marketing investment has contributed to growth in retail entertainment revenue during the period.

Location operating costs as a percent of revenues increased from 29% to 32% for the nine months ended March 29, 2026 compared to the same period of the prior fiscal year, consistent with the seasonal dynamics of our FEC and water park locations described above. As a result, location operating costs for these locations tend to increase at a higher rate than revenues during the second and third quarters of our fiscal year, consistent with the seasonal pattern observed in the current period. Notwithstanding this increase, location operating costs as a percent of revenues improved sequentially in each quarter of fiscal 2026 to date, as described above, reflecting the Company's ongoing efforts to optimize location-level cost efficiency.

Location payroll and benefit costs: Location payroll and benefit costs increased $19,992, or 9%, during the nine months ended March 29, 2026 compared to the same period of the prior fiscal year. The increase is primarily driven by location count growth, additional bonus incentives, and an overall increase in labor hours per location. Water park and FEC locations had a significant impact, contributing approximately $10,100 to the increase over the comparable period. The remaining increase reflects higher labor hours and bonus incentive costs across existing same-store locations during the period.

Location food & beverage costs: Location food & beverage costs as a percentage of food & beverage revenue remained flat at 22%. Location food & beverage costs increased $1,334, or 2%. The increase in location food & beverage costs is mainly attributable to increased food & beverage revenue as compared to the same period of the prior fiscal year.

Selling, general and administrative expenses (“SG&A”): SG&A expenses decreased $454 or less than 1% for the nine months ended March 29, 2026 compared to the same period of the prior fiscal year. The decrease is primarily attributable to a decline in share-based compensation expense of approximately $8,600, driven by a non-recurring settlement of equity awards in the prior year period related to the retirement of a long-tenured executive of the Company. Partially offsetting this decrease, SG&A labor increased approximately $7,200, reflecting strategic investments in our marketing, water park, and FEC teams. The increase in marketing headcount is directly aligned with our initiative to increase our overall marketing budget, as management believes a larger and more capable marketing team is necessary to effectively deploy the expanded investment. The water park and FEC teams consist primarily of year-round staff who support peak seasonal operations during the summer months.

Depreciation and amortization: Depreciation and amortization decreased $20,664 or 18% for the nine months ended March 29, 2026 compared to the same period of the prior fiscal year. The decrease primarily reflects the impact of a

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change in the estimated useful lives of certain fixed assets, which resulted in a reduction in depreciation expense of approximately $23,942 compared to the same period of the prior fiscal year. This decrease was partially offset by depreciation and amortization associated with capital expenditures and acquired assets since the third quarter of fiscal 2025.

Interest expense, net: Interest expense increased $7,374, or 5% for the nine months ended March 29, 2026 compared to the same period of the prior fiscal year. The higher interest expense is primarily attributable to increases in debt since the third quarter of fiscal 2025. Specifically, the Notes, which were issued late in the first quarter of fiscal 2026. We have approximately $19,000 of interest accrued related to the Notes as of March 29, 2026. In addition to the impact of the Notes, the increase is attributable to the amortization of approximately $3,300 of deferred financing costs associated with the Bridge Term Loan during the first quarter of fiscal 2026. The increases in interest expense were partially offset by a $14,245 decrease in interest expense for finance leases due to the purchase of previously leased assets.

Change in fair value of earnouts: The impact on the statement of operations during nine months ended March 29, 2026 is due to the decrease in the fair value of the earnouts. The decrease in the fair value of the earnouts is primarily driven by the decrease in the Company’s stock price and the limited remaining vesting period associated with the earnouts, which reduce the estimated probability of vesting.

Income tax expense (benefit): Income tax expense (benefit) and deferred tax assets and liabilities reflect management’s assessment of the Company’s tax position. During the nine months ended March 29, 2026, the Company determined that its estimated AETR was not possible to reliably estimate due to the timing of results and the existence of a valuation allowance against interest limitation due to IRC Section 163(j). As a result, the Company utilized the discrete method. The effective tax rate of (1,099)% for nine months ended March 29, 2026 was primarily attributed to state taxes incurred relating to the repurchase of the 58 properties under the Carlyle master lease agreement, the change in fair value of the earnout liability, permanent differences, and other discrete tax items.

Non-GAAP measure

Adjusted EBITDA is a non-GAAP financial measure that is not in accordance with, or an alternative to, measures prepared in accordance with GAAP. The Company believes certain financial measures which meet the definition of non-GAAP financial measures provide important supplemental information. The Company considers Adjusted EBITDA as an important financial measure because it provides a financial measure of the quality of the Company’s earnings. Other companies may calculate Adjusted EBITDA differently than we do, which might limit its usefulness as a comparative measure. Adjusted EBITDA is used by management in addition to and in conjunction with the results presented in accordance with GAAP. We have presented Adjusted EBITDA solely as a supplemental disclosure because we believe it allows for a more complete analysis of results of operations and assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance, such as Interest Expense, Income Taxes, Depreciation and Amortization, Impairment Charges, Share-based Compensation, EBITDA from Closed Locations, Foreign Currency Exchange Loss (Gain), Asset Disposition Loss (Gain), Transactional and other advisory costs, Changes in the value of earnouts, and Other. Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP.

Refer to notes below for additional details concerning the respective items for Adjusted EBITDA.

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The following table provides a reconciliation from net income (loss) to Adjusted EBITDA for each reporting period:


	Three Months Ended				Nine Months Ended
	March 29, 2026		March 30, 2025		March 29, 2026		March 30, 2025
Net income (loss)	$	16,851	$	13,292	$	(9,603)	$	64,694
Adjustments:
Interest expense	50,782		49,414		155,513		146,879
Income tax expense (benefit)	5,773		18,348		8,802		(2,897)
Depreciation and amortization	32,627		40,741		96,910		117,751
Loss on impairment, disposals, and other charges, net	1,507		648		6,793		4,695
Share-based compensation (1)	2,993		8,788		9,312		17,955
Closed location EBITDA (2)	872		251		2,215		3,645
Transactional and other advisory costs (3)	4,366		4,485		18,727		11,764
Changes in the value of earnouts (4)	(7,740)		(18,886)		(31,186)		(87,489)
Other, net (5)	982		179		1,654		1,963
Adjusted EBITDA	$	109,013	$	117,260	$	259,137	$	278,960

Notes to Adjusted EBITDA:

(1)Includes the non-recurring settlement of equity awards related to the retirement of a long-time executive of the Company during the period ended March 30, 2025, which resulted in an additional $4,809 of share-based compensation expense.

(2)The closed location adjustment is to remove EBITDA for closed locations. Closed locations are those locations that are closed for a variety of reasons, including permanent closure, newly acquired or built locations prior to opening, locations closed for renovation or rebranding and conversion. If a location is not open on the last day of the reporting period, it will be considered closed for that reporting period. If the location is closed on the first day of the reporting period for permanent closure, the location will be considered closed for that reporting period.

(3)The adjustment for transaction costs and other advisory costs is to remove charges incurred in connection with any transaction, including mergers, acquisitions, refinancing, amendment or modification to indebtedness, and dispositions, in each case, regardless of whether consummated.

(4)The adjustment for changes in the value of earnouts is to remove of the impact of the revaluation of the earnouts. Changes in the fair value of the earnout liability is recognized in the statement of operations. Decreases in the liability will have a favorable impact on the statement of operations and increases in the liability will have an unfavorable impact.

(5)Other includes the following related to transactions that do not represent ongoing or frequently recurring activities as part of the Company’s operations: (i) non-routine expenses, net of recoveries for matters outside the normal course of business, (ii) severance expense, and (iii) other individually de minimis expenses.

Liquidity and Capital Resources

We manage our liquidity through assessing available cash-on-hand, our ability to generate cash and our ability to borrow or otherwise raise capital to fund operating, investing and financing activities.

A core tenet of our long-term strategy is to grow the size and scale of the Company in order to improve our operating profit margins through leveraging our fixed costs. As such, one of the Company’s known cash requirements is for capital expenditures related to the construction of new locations and upgrading and converting existing locations. We believe our financial position, generation of cash, available cash-on-hand, existing credit facility, and access to potentially obtain additional financing from sale-lease-back transactions or other sources will provide sufficient capital resources to fund our operational requirements, capital expenditures, and material short and long-term commitments for the foreseeable future. We also plan to use available cash-on-hand to fund our share repurchase program, which was implemented as a method to return value to our shareholders. However, there are a number of factors that may hinder our ability to access these capital resources, including but not limited to our degree of leverage, and potential borrowing restrictions imposed by our lenders. See “Risk Factors” included in our previously filed Annual Report on Form 10-K for the fiscal year ended June 29, 2025 for further information.

At March 29, 2026, we had approximately $58,654 of available cash and cash equivalents.

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Nine Months Ended March 29, 2026 Compared to the Nine Months Ended March 30, 2025

The following compares the primary categories of the condensed consolidated statements of cash flows for the periods ended March 29, 2026 and March 30, 2025:


	Nine Months Ended				$ Change		% Change
(in thousands)	March 29, 2026		March 30, 2025
Net cash provided by operating activities	$	115,853	$	154,767	$	(38,914)	(25)	%
Net cash used in investing activities	(429,682)		(166,412)		(263,270)		*
Net cash provided by financing activities	312,308		23,925		288,383		*
Effect of exchange rate changes on cash	489		(164)		653		*
Net change in cash and cash equivalents	$	(1,032)	$	12,116	$	(13,148)	*

_________

*Represents a change equal to or in excess of 100% or one that is not meaningful.

Operating activities provided $115,853 as compared to providing $154,767 during the same period of the prior fiscal year. The decrease in cash provided by operating activities is due primarily to unfavorable changes in working capital coupled with lower net income.

Investing activities used $429,682 as compared to $166,412 during the same period of the prior fiscal year. The increase in cash used in investing activities mainly reflects the purchase of previously leased assets offset by a decrease in purchases of property and equipment.

Financing activities provided $312,308 as compared to using $23,925 during the same period of the prior fiscal year. The increase in cash provided by financing activities primarily reflects the proceeds from the Fifteenth Amendment to the First Lien Credit Agreement and the issuance of Senior Secured Notes. This was partially offset by the repayment of outstanding debt and payment of deferred financing costs.

Our contractual obligations primarily include, but are not limited to, debt service, self-insurance liabilities, and leasing arrangements. We believe our sources of liquidity, namely available cash on hand, history of generating positive operating cash flows, and access to capital markets will continue to be adequate to meet our contractual obligations, as well as fund working capital, planned capital expenditures, location acquisitions, and execute purchases under our share repurchase program.

Critical Accounting Estimates

Our critical accounting estimates are discussed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended June 29, 2025 under “Critical Accounting Estimates.” There have been no significant changes in our critical accounting estimates during the quarter ended March 29, 2026.

Recently Issued Accounting Standards

See Note 1 - Description of Business and Significant Accounting Policies of the notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q for information regarding new accounting pronouncements.

Emerging Growth Company Accounting Election

We are currently an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. We will lose our emerging growth company status on June 28, 2026, which is the last day of the fiscal year following the fifth anniversary of Isos’ IPO (March 5, 2026).

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risk from changes in, among other things, interest rates, credit risk, labor costs, health insurance claims and foreign currency exchange rates, which could impact its results of operations and financial condition. We attempt to address our exposure to these risks through our normal operating and financing activities.

Interest Rate Risk

Under our term and revolving credit facilities, we are exposed to a certain level of interest rate risk. Interest on the principal amount of our borrowings under our revolving credit facility loan accrues at the Adjusted Term Secured Overnight Financing Rate or the Alternate Base Rate, as further described in the credit agreement governing our term and revolving credit facilities. An increase or decrease of 1.0% in the effective interest rate would cause an increase or decrease to interest expense of approximately $12,650 over a twelve month period on our outstanding debt without considering the impact of hedging. The Company entered into two hedging transactions effective as of March 31, 2023 for an aggregate notional amount of our term loan of $800,000. The hedge transactions have a trade and hedge designation date of April 4, 2023. The hedge transactions, each for a notional amount of $400,000, provide for interest rate collars. The interest rate collars establish a floor on SOFR of 0.9429% and 0.9355%, respectively, and a cap on SOFR of 5.50%. The interest rate collars had a maturity date of March 31, 2026. Subsequent to the end of the quarter, the interest rate collars reached maturity and expired with a zero fair value, resulting in no income statement, OCI, or cash flow impact.

Credit Risk

Financial instruments that potentially subject us to significant concentrations of credit risk consist of cash and temporary investments. We are exposed to credit losses in the event of non-performance by counter parties to our financial instruments. We place cash and temporary investments with various high-quality financial institutions. Although we do not obtain collateral or other security to secure these obligations, we periodically monitor the third-party depository institutions that hold our cash and cash equivalents. Our emphasis is primarily on safety and liquidity of principal and secondarily on maximizing yield on those funds.

Commodity Price Risk

We are exposed to market price fluctuation in food, beverage, supplies and other costs such as energy. Given the historical volatility of certain of our food product prices, including proteins, produce, dairy products, and cooking oil, these fluctuations can materially impact our food costs. While our purchasing commitments partially mitigate the risk of such fluctuations, there is no assurance that supply and demand factors such as disease or inclement weather will not cause the prices of the commodities used in our food operations to fluctuate. Additionally, the cost of purchased materials may be influenced by tariffs and other trade regulations which are outside of our control. To the extent that we do not pass along cost increases to our customers, our results of operations may be adversely affected.

Inflation

We experience inflation related to our purchase of certain products that we need to operate our business. This price volatility could potentially have a material impact on our financial condition and/or our results of operations. In order to mitigate price volatility, we monitor price fluctuations and may adjust our prices accordingly, however, our ability to recover higher costs through increased pricing may be limited by the competitive environment in which we operate.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Exchange Act is properly and timely reported and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these disclosure controls and procedures are effective as of March 29, 2026.

Changes in Internal Control Over Financial Reporting

There were no changes to our internal control over financial reporting practices or processes that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting during our third quarter ended March 29, 2026.

Table of Contents

Index to Notes

Part II

Item 1. Legal Proceedings

For a description of all material pending legal proceedings, see Note 9 - Commitments and Contingencies of the notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

Item 1A. Risk Factors

There have been no material changes to our risk factors contained in Part I. Item 1A. “Risk Factors” of our Annual Report on Form 10-K for the year ended June 29, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

The following table provides information regarding purchases of our securities made by us for the quarter ended March 29, 2026.


(in thousands, except share and per share amounts)	Total Number of Class A Shares Purchased	Average Price Paid per Class A Share*		Total Number of Shares Purchased as Part of Publicly Announced Programs	Dollar Value of Shares That May Yet Be Purchased Under The Publicly Announced Repurchase Program*
December 29, 2025 to February 1, 2026	24,500	$	8.90	24,500	$	67,352
February 2, 2026 to March 1, 2026	668,459	6.67		668,459	62,894
March 2, 2026 to March 29, 2026	336,478	8.29		336,478	60,106
	1,029,437	$	7.25	1,029,437

*The average price paid per share and dollar value of shares that may yet be purchased under the plan includes any commissions paid to repurchase stock (but excludes any excise taxes).

Item 6. Exhibits


Exhibit No.						Description
10.1+						Resignation, Severance, and Release Agreement , dated February 18, 2026, b etween Lev Eks ter and Lucky Strike Entertainment Corporation.
31.1+						Certification of the Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
31.2+						Certification of the Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
32.1+						Certification of the Principal Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
32.2+						Certification of the Principal Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
101.INS						XBRL Instance Document
101.SCH						XBRL Taxonomy Extension Schema Document
101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF						XBRL Taxonomy Extension Definition Linkbase Document
101.LAB						XBRL Taxonomy Extension Label Linkbase Document
101.PRE						XBRL Taxonomy Extension Presentation Linkbase
104						Cover Page Interactive Data File (embedded within the Inline iXBRL document).

____________

+ Filed herewith.

Table of Contents

Index to Notes

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		LUCKY STRIKE ENTERTAINMENT CORPORATION

Date:	May 6, 2026	By:	/s/ Robert M. Lavan
		Name:	Robert M. Lavan
		Title:	Chief Financial Officer
			(Principal Financial Officer)

Lucky Strike Entertainment - 10-Q quarterly report FY

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		Page
Note 1	Description of Business and Significant Accounting Policies	10
Note 2	Business Acquisitions	13
Note 3	Goodwill and Other Intangible Assets	13
Note 4	Property and Equipment	14
Note 5	Leases	14
Note 6	Accounts Payable and Accrued Expenses	18
Note 7	Debt	18
Note 8	Income Taxes	20
Note 9	Commitments and Contingencies	20
Note 10	Earnouts	20
Note 11	Fair Value of Financial Instruments	21
Note 12	Common Stock, Preferred Stock and Stockholders’ Equity	22
Note 13	Share-Based Compensation	23
Note 14	Net Income (Loss) Per Share	25
Note 15	Supplemental Cash Flow Information	27