Good Times Restaurants Inc. (Nasdaq: GTIM), the operator of the popular Bad Daddy’s Burger Bar and Good Times Burgers & Frozen Custard brands, has released its financial results for the second quarter of fiscal 2025, highlighting a mixed quarter marked by revenue declines, evolving marketing strategies, and targeted efforts to improve operational performance.
For the quarter ended March 2025, the company reported total revenues of $34.3 million, representing a decrease of 3.3% compared to the same quarter in fiscal 2024. Comparable sales at company-owned Bad Daddy’s Burger Bar locations fell by 3.7%, while same-store sales at Good Times locations dropped by 3.6% year-over-year. On a year-to-date basis, same-store sales are down 1.1% and 1.9% for the Bad Daddy’s and Good Times brands, respectively.
The company also reported a net loss attributable to common shareholders of $0.6 million for the quarter. Adjusted EBITDA, a non-GAAP financial measure used by the company to assess operational performance, came in at $1.0 million. As of the end of the quarter, the company held $2.7 million in cash and had $2.6 million in long-term debt on its books. Additionally, 54,835 shares of common stock were repurchased during the reporting period under the company’s stock buyback program.
Despite the financial setbacks, Good Times Restaurants CEO Ryan M. Zink remains cautiously optimistic and pointed to sequential improvements in sales throughout the quarter. However, he acknowledged that March sales were still below expectations, with Bad Daddy’s experiencing a same-store sales decline of 2.2% and Good Times seeing a smaller decline of 0.4%.
Bad Daddy’s Brand Performance and Strategic Initiatives
Zink noted that despite lower sales, the company’s cost management discipline at Bad Daddy’s helped preserve profitability. The brand delivered a restaurant-level operating profit margin of 13.6%, matching the performance of the prior year, a notable achievement considering the deleveraging impact of reduced average unit volumes.
To drive traffic and refresh the menu, Bad Daddy’s reintroduced its Birria Burger, originally launched the previous year, just in time for Cinco de Mayo and National Burger Month. This item is now being offered alongside two new additions: the Elote Street Corn Dip and the Churro Shake, all available through mid-August.
Zink also highlighted the recent introduction of the Smash n’ Stack burger, a new entry into their lineup of smashed-patty burgers. This double bacon cheeseburger is competitively priced at $11.95 and is positioned as a strong value offering with a half-pound of beef. The menu rollout builds upon the chain’s transition to an à la carte pricing model implemented five years ago. However, Zink noted that recent tests of a bundled pricing approach, where sides are included, have yielded encouraging results. The company now plans to transition all locations to this revised pricing strategy by the end of the June quarter.
In a bid to bolster visibility and attract new customers, Bad Daddy’s also began testing connected TV and streaming video advertising in two of its regional markets—northern Colorado and the northern suburbs of Atlanta. The early response has been promising, leading to an expansion of the campaign across additional locations during the June quarter.
Good Times Brand Faces Competitive Pressure and Internal Changes
In contrast, the Good Times Burgers & Frozen Custard brand continues to face headwinds. Zink attributed the decline in both sales and profit margins to aggressive discounting by competitors. To combat this, the brand is reassessing its advertising strategy, particularly the use of radio, which has shown diminishing returns. Similar to Bad Daddy’s, Good Times will experiment with streaming and connected TV ads in the hopes of generating incremental sales.
To spearhead improvement initiatives, the company recently appointed Craig Soto as Director of Operations for the Good Times brand. Soto has been tasked with enhancing restaurant-level execution to improve food quality, service consistency, and overall guest experience. Together with the culinary team, Soto has launched a comprehensive menu review, aimed at assessing modern appeal, operational feasibility, and profit contribution of each item.
Additionally, the brand’s restaurant remodel program is progressing steadily. According to Zink, two-thirds of the system has already been remodeled, and further updates are planned throughout the remainder of the fiscal year. Two specific locations requiring extensive renovation work are expected to be remodeled in fiscal 2026.
Organizational and Financial Adjustments to Strengthen Performance
Beyond the restaurant operations, Good Times Restaurants is taking steps at the corporate level to enhance organizational effectiveness. The company’s long-time purchasing leader is set to retire at the end of the June quarter. That role will be filled by an internal candidate with deep experience in product and operations, ensuring continuity and a smooth transition.
Zink also mentioned a streamlining of leadership, including a reduction in the number of multi-unit leaders at Bad Daddy’s, and a potential similar adjustment at Good Times. The goal is to improve efficiency while strengthening supervision and leadership at the immediate above-store level.
In terms of capital allocation, Zink noted that the company has decided to pause stock repurchases temporarily, choosing instead to direct cash flow toward debt reduction and liquidity accumulation. This decision is part of a broader effort to ensure a more resilient balance sheet amid a challenging operating environment.
