The Topgolf Venu 1Q23 Takeaways:
The company recorded better-than-expected revenue and adjusted EBITDA, which management commented was driven by the continued momentum at their Topgolf venues. This segment outperformed expectations from both a revenue and a profitability standpoint while seeing margin improvement because of operational efficiencies. Own venues delivered 11% SSS growth, driven by continued brand momentum, increased digital access through PIE, their inventory management system, and a new marketing initiatives. They opened one venue during 1Q23 in Charleston, South Carolina, and have seen strong business trends there since opening. The company remains on track to open 11 new owned and operated venues in 2023, with one scheduled to open in 2Q23 and the balance coming in 2H23. Management commented that their 1Q23 results have made them increasingly confident in their ability to drive long-term same-venue sales growth, and they are now guiding higher venue profitability expectations. "As a result, we remain confident in our Topgolf earnings forecast for this year and have increased confidence in our ability to continue to deliver sustained same-venue sales growth throughout business cycles, something we recognize we must prove to the markets and we hope that our six consecutive quarters have delivered same venue sales growth is starting to do. With this increased confidence in 2023 and the higher venue economic expectations announced today, our confidence in delivering on or exceeding our previously announced long-term economic targets has of course, also increased." - Management said. Our traffic data indicates that Topgolf saw tremendous growth in 1Q23. Topgolfs traffic in January was up 28.5% YoY, up 16.2% in February, and up 6.3% in March. We are starting to see a slowing in their traffic data as traffic in March was only up 2.9%. This compares to PLAY traffic in January was up 26.4% YoY, (-2.9%) in February, and (-9.9) in March.
These trends look very similar to what we are seeing in the restaurant space as well as macroeconomic data has also been deteriorating since the start of the year.
Top Golf traffic appear to be holding up better than Dave & Busters
Restaurant Traffic
May sales started out with a big WoW deceleration in to (-13.3%) in the first week of May from (-7.3%) in April
May sales started out better for the Quick Service Segment with a acceleration WoW to (-1.26%) in the first week of May from (-3.1%) in April
