Good Times Restaurants (NASDAQ:GTIM) executives said fiscal 2025 fourth-quarter results were pressured by softer sales and higher costs, with Chief Executive Officer Ryan Zink pointing to “significantly elevated” ground beef prices as a key driver of the quarter’s weaker profitability.
Speaking on the company’s fiscal 2025 fourth-quarter and year-end earnings call, Zink said the quarter was “a challenging one,” particularly at the Good Times burger concept, and added that management is “disappointed in the results and committed to immediate improvement.” While same-store sales at Good Times remained negative in the fourth quarter, Zink noted the decline moderated sequentially.
Sales trends: sequential improvement cited entering fiscal 2026
At Bad Daddy’s, management also saw weakness in the fourth quarter but said trends improved into the new fiscal year. Zink said Bad Daddy’s same-store sales were down approximately 1.6% through the first 11 weeks of the first quarter versus the prior-year period, with improvement “most evident” in Colorado restaurants after those locations had weighed on results during 2025.
Senior Vice President of Finance and Accounting Keri August reported that total company revenue decreased about 5.1% in the quarter to $34 million. For the full year, revenue declined about 0.5% to $141.6 million compared to the company’s record fiscal 2024 sales.
Bad Daddy’s: traffic pressures, higher labor and food costs
August said Bad Daddy’s total restaurant sales fell $1.7 million to $24 million in the quarter and declined $2.2 million to $101.4 million for the full year. She attributed the quarterly decrease primarily to reduced customer traffic and the closure of the Longmont, Colorado restaurant in the fourth quarter of fiscal 2024, partially offset by menu price increases.
Bad Daddy’s same-store sales decreased 4.6% in the quarter, with 38 restaurants in the comparable base at quarter end. Average menu price during the quarter was 0.4% higher than in the prior-year quarter. Looking ahead, August said the company expects an average price increase of approximately 1.7% for Bad Daddy’s in the first quarter of fiscal 2026, and that it does not expect “any significant price increases over the next six months,” aside from targeted adjustments tied to menu engineering.
On margins, August said Bad Daddy’s food and beverage costs were 31.6% of sales in the quarter, up 40 basis points year over year, driven by record high ground beef prices and higher protein costs. She said input costs have been lower so far in the first quarter of fiscal 2026 and the company expects cost of sales as a percentage of revenue to improve sequentially, despite a “large number of complimentary burgers” provided to military guests on Veterans Day.
Labor costs rose 140 basis points to 35.7% of sales, which August tied to lower productivity stemming from sales deleverage. She noted wage pressure in Colorado, including a January increase in the state’s minimum wage to $15.16 (up 2.4%) and an increase in the tipped minimum wage to $12.14 (up 3%).
Occupancy costs were 6.7% of sales, up 50 basis points, primarily due to a decrease in the benefit from GAAP-required non-cash rent adjustments. Other operating costs rose to 16% of sales, up 80 basis points, due mainly to higher repair and maintenance and utility expenses.
Bad Daddy’s restaurant-level operating profit, a non-GAAP measure, was approximately $2.4 million, or 9.9% of sales, down from $3.4 million, or 13.2%, a year earlier. August attributed the decline to higher labor and food costs and the impact of lower sales on fixed costs.
Good Times: price restraint and operations focus amid cost inflation
At the Good Times concept, August said company-owned restaurant sales decreased about $0.3 million to $9.7 million in the quarter, while full-year sales increased $1.2 million to $39.2 million compared with fiscal 2024. Same-store sales decreased 6.6% in the quarter, with 27 restaurants in the comparable base. Average menu price was “approximately the same” as the prior-year quarter.
Zink emphasized that the company has been cautious on pricing. He said Good Times has taken about 1% of menu price increases since January 2024 and remains sensitive to further increases given what he characterized as the quick-service burger segment’s recent reputation challenges around value. August said the company implemented a small menu price increase for the first quarter of fiscal 2026 and expects only modest increases, with any changes likely to be “very targeted adjustments” to specific items rather than broad price hikes.
August said Good Times food and packaging costs rose to 32.1% of sales, up 120 basis points, driven by record high beef prices as well as higher bacon and egg costs. Labor costs increased to 35.9% from 33.9% a year earlier, reflecting higher wage rates and weaker productivity due to sales deleverage. Other operating costs increased to 15% of sales, up 110 basis points, due to higher delivery, technology, and utility expenses.
Good Times restaurant-level operating profit fell by $0.4 million to $0.8 million and declined 420 basis points as a percentage of sales to 8%, which August said reflected elevated costs “throughout the P&L.”
Operational initiatives and marketing plans
Zink highlighted operational changes at Good Times under Director of Operations Craig Soto, including adjusting general manager schedules to better match peak revenue periods. He said the goal is to improve awareness and execution during dinner and late-night dayparts. Zink also said the company has made progress in restaurant-level training and is preparing to roll out “true cook-to-order” for burger products with minimal impact on speed of service.
On promotions, Zink said the company remains averse to large-scale discounting because of its impact on profitability. Instead, he said Good Times plans “highly targeted value promotions” beginning in the spring, with expanded offerings through its GT Rewards loyalty program and a refreshed mobile app designed to simplify mobile ordering.
At Bad Daddy’s, Zink cited momentum from product promotions and described a shift in approach. He said a fall promotion featuring a “giant shareable Bavarian Pretzel” performed well and could become a core menu item, and that a holiday Chocolate Cookie Cheesecake, made in-house, addressed a long-standing customer request and could also be added to the core menu. After a winter promotion anchored by a Mediterranean Power Bowl and two regional burger features, Zink said Bad Daddy’s expects to move to a “burger of the month” platform to simplify messaging, sharpen execution, and focus on familiar items while maintaining scratch-made quality.
Profitability, cash and outlook commentary
August said combined general and administrative expense was $2.4 million in the quarter, or 7% of total revenue, down 70 basis points year over year. She said the decrease was driven by lower multi-unit supervision costs, legal and professional services, outsourced accounting fees, and health insurance underwriting costs, partially offset by higher recruiting and training costs. The company expects G&A to run 6% to 7% in fiscal 2026.
Net loss attributable to common shareholders was $3,000, or $0.00 per share, compared with net income of $0.2 million, or $0.02 per share, in the prior-year quarter. Adjusted EBITDA was negative $74,000 compared with $1.3 million in the fourth quarter of fiscal 2024. The company ended the quarter with $2.6 million in cash and $2.3 million of long-term debt.
No analysts asked questions during the call. In closing remarks, Zink said the first quarter of fiscal 2026 is “shaping to mark improvement in same-store sales and in Adjusted EBITDA,” citing a “robust” product and promotional roadmap and continued operating improvements aimed at delivering better guest experiences.
About Good Times Restaurants (NASDAQ:GTIM)
Good Times Restaurants International, Inc (NASDAQ: GTIM) owns, develops, operates and franchises quick-service restaurants under the Good Times Burger & Frozen Custard brand. The company’s restaurants feature a signature menu built around hand-pressed, fresh-never-frozen beef burgers, homemade buns, fresh-cut fries, handcrafted milkshakes and frozen custard desserts. Good Times supplements its core offerings with seasonal items and limited-time promotions designed to appeal to a variety of customer tastes.
Founded in 1987 and headquartered in Lakewood, Colorado, Good Times has expanded through a mix of company-owned locations and franchising agreements.
Featured Articles
- Five stocks we like better than Good Times Restaurants
- Do not delete, read immediately
- INVESTOR ALERT: Tiny “$3 AI Wonder Stock” on the Verge of Blasting Off
- Can Any Expenses Be Deducted From Capital Gains Tax?
- Buffett, Gates and Bezos Quietly Dumping Stocks—Here’s Why
- Forget AI, This Will Be the Next Big Tech Breakthrough
