RCI Hospitality Holdings, Inc. — 3Q26 Earnings Summary

Financial Performance

• Total revenues for the quarter ended June 30, 2026, were $73.9 million, an increase from $71.1 million in the prior-year period.
• GAAP EPS was $0.83, compared to $0.46 in the prior year; Non-GAAP EPS was $0.90, compared to $0.77 in the prior year.
• Net income attributable to common stockholders was $6.4 million, up from $4.1 million in the prior year.
• Adjusted EBITDA was $16.9 million, representing 22.9% of revenues, compared to $15.3 million (21.6% of revenues) in the prior year.
• Net cash provided by operating activities was $11.3 million, down from $13.8 million in the prior year.
• Free cash flow was $10.6 million, down from $13.3 million in the prior year.
• Impairments and other charges, net were immaterial ($0.0 million) compared to $2.3 million in the prior year.
• Debt declined to $240.1 million at June 30, 2026, a decrease of $8.6 million from March 31, 2026, and $1.2 million from the prior year.
• Weighted average shares outstanding declined 13.0% to 7.65 million due to share buybacks.

Business Segments and Product Lines

• Nightclubs: Revenues increased 1.0% to $63.0 million. Same-store sales grew 4.7% across 52 clubs, while four newly acquired, opened, or reformatted clubs generated $4.0 million in sales. Service revenue increased 7.6%, while food, merchandise, and other declined 1.4%, and alcoholic beverages declined 4.2%. Operating income was $19.6 million (31.2% margin) compared to $17.9 million (28.6% margin) in the prior year.
• Bombshells: Revenues increased 25.4% to $10.8 million. Three new locations (Denver, CO; Lubbock, TX; Rowlett, TX) generated $2.6 million in sales, while nine same-store locations produced $8.2 million. Alcoholic beverage sales increased 33.6% and food and other sales increased 16.6%. Operating income was $759,000 (7.0% margin) compared to $67,000 (0.8% margin) in the prior year.
• Corporate: Expenses totaled $7.3 million, down from $9.1 million in the prior year, representing 9.9% of total revenues compared to 12.9%. Non-GAAP expenses were also $7.3 million, down from $8.7 million.
• High-profile professional basketball and soccer events benefited activity in both Nightclubs and Bombshells segments.

Other Key Points

• The company utilized its strong cash position to continue buying back shares and reducing debt.
• Results reflected lower impairment and insurance costs compared to the prior year.
• The company adopted Accounting Standards Update (ASU) 2023-07, requiring enhanced reportable segment disclosures, which resulted in recast prior-year segment information.
• The company hosts an X Spaces conference call at 4:30 PM ET on the day of the release.
• The company operates more than 60 locations and is the country's leading company in adult nightclubs and sports bars-restaurants.