Bowlero Corp reported a strong top-line performance in QQ2 2025, with revenue of $339.9 million, up 19.7% year-over-year and 13.3% quarter-over-quarter. Gross profit reached $144.1 million, yielding a gross margin of 42.4%, while EBITDA stood at $121.4 million and operating income at $62.2 million, translating to margins of 35.7% and 18.3% respectively. Net income was $13.3 million, or $0.07 per share, and free cash flow (FCF) was $61.1 million with operating cash flow of $86.6 million, supported by capital expenditures of $25.5 million. The company generated positive cash flow and meaningful margin expansion versus prior year, signaling improving operational leverage across its center network.
However, Bowlero continues to operate with a highly leveraged balance sheet. Total debt stands at $2.595 billion and net debt at $2.516 billion, while stockholders’ equity is negative at approximately $(86.4) million. Liquidity metrics show a current ratio of 0.64, quick ratio of 0.56, and cash ratio of 0.39, underscoring balance sheet risk amid elevated interest costs (interest expense of $49.4 million) and sizable long-term indebtedness. Despite robust FCF generation, the leverage burden may constrain near-term strategic flexibility and capex cadence. Management commentary (not provided in the data) would be critical to confirm any de-leveraging plans, capital allocation priorities, and longer-term growth initiatives.
Looking ahead, the QQ2 performance implies continued demand for Bowlero’s bowling entertainment format, with room to improve profitability through center optimization and cost discipline. The key questions for investors are: Can Bowlero accelerate deleveraging given 2025 FCF generation? How will refinancing efforts and capex plans influence balance sheet health? And how do Bowlero’s growth opportunities compare with peers in the entertainment and family recreation space as consumer spending evolves?