Improved Profitability and Return to Net Income
Net income of $0.1M ($0.01 per share) in Q2 FY2026 versus a net loss of $0.6M (-$0.06 per share) in Q2 FY2025. Adjusted EBITDA increased to $1.4M from $1.0M year-over-year (~+40%). Good Times restaurant-level operating profit rose $0.1M to $0.9M, representing 10.1% of sales (+150 basis points year-over-year). Bad Daddy's restaurant-level operating profit remained stable at $3.3M (13.8% of sales).
Material Cost Improvements
Food and beverage/packaging costs declined ~100–110 basis points for both concepts: Bad Daddy's F&B costs 29.6% (-110 bps) and Good Times food & packaging 29.7% (-100 bps) versus prior year. Labor efficiency improved with Bad Daddy's labor at 34.1% (-20 bps) and Good Times labor at 35.0% (-60 bps), contributing to margin gains.
Loyalty Program Traction
GT Rewards now generates 7% of sales, up from just under 4% prior to switching loyalty engines to Thanx in December. Membership is growing at ~5% per month (roughly a 75% annualized growth rate at current clip), supporting repeat sales and marketing plans.
Successful Product & Marketing Initiatives
Hired Cultivator as creative/advertising agency; tested a $2 Bambino promotion with strong same-store sales and traffic improvement and planned system-wide rollout in June. Reintroduced popular menu items (cheese curbs) and announced summer custard spoon benders and Bad Daddy's monthly 'drops' program, aiming to drive traffic and frequency.
Tighter G&A and Strengthened Balance Sheet Metrics
Combined G&A decreased to $2.2M or 6.6% of revenues (down 90 bps YOY) with guidance of 6–7% for the full year. Company finished quarter with $2.7M cash and only $1.0M long-term debt; management highlighted reduced leverage and improved liquidity posture.