Shares of Ark Restaurants Corp. ARKR have gained 1.3% since the company reported its earnings for the quarter ended March 29, 2025. This underperformed the broader S&P 500 Index, which advanced 4.6% over the same period. However, the stock’s performance over the past month has been notably strong, surging 34.1%, handily outpacing the S&P 500’s 11.8% increase.

Quarterly Financial Overview

For the second quarter of fiscal 2025, Ark Restaurants posted total revenues of $39.7 million, down 5.9% from $42.3 million in the year-ago period. When excluding revenues from the now-closed El Rio Grande and the Tampa Food Court, the decline narrows significantly, with revenues down 1.1% to $39.7 million from $40.1 million last year.

Despite a modest improvement in same-store sales — up 0.4% year over year, excluding revenues from El Rio Grande and the Tampa Food Court — profitability deteriorated sharply. The company reported a net loss attributable to Ark Restaurants of $9.3 million, or $(2.57) per share compared with a net loss of $1.4 million, or $(0.40) per share, in the same quarter last year. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

The loss was primarily driven by a $3.4 million goodwill impairment and a full valuation allowance of $4.8 million against deferred tax assets, both of which are non-cash items. Adjusted EBITDA, which excludes these charges, was a loss of $0.7 million compared with a loss of $0.3 million in the prior-year period.

Other Key Business Metrics

Cost efficiencies were mixed across categories. Food and beverage costs declined 5.4% to $11.5 million from $12.1 million, and payroll expenses also dropped 7.1% to $14.4 million from $15.5 million. However, general and administrative expenses rose 5.8% to $3.3 million from $3.1 million, and depreciation and amortization fell 33.7% to $5.6 million from $5.8 million. Occupancy costs and other operating expenses also declined 4.3% to $0.7 million from $1.1 million. Operating loss was $4.6 million compared with a $1.2 million loss in the prior-year quarter, primarily due to impairments and legal costs associated with a lease dispute.

On the balance sheet, Ark Restaurants reported $11.1 million in cash and $4.3 million in total debt as of March 29, 2025. Management noted this debt will be refinanced under a new facility with increased capacity of $15–$20 million.

On a segmental basis, CEO Michael Weinstein noted on the earnings call that Las Vegas operations showed marked improvement, with greater efficiency driving significantly better weekly cash flows. Florida restaurants reported revenue gains compared to the prior year, while operations in Alabama remained stable. The company also highlighted signs of improvement at its Washington, D.C., location following management changes.