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Introduction & Market Context
Lucky Strike Entertainment Corp (NYSE:LUCK) presented its Q3 2025 investor presentation on May 8, 2025, highlighting its position as a leading player in the $100 billion-plus out-of-home entertainment market. The company, which recently rebranded from Bowlero Corp, continues to leverage its acquisition strategy to drive growth across its expanding portfolio of entertainment venues.
The presentation comes after Lucky Strike reported a strong start to fiscal year 2025, with a 15% increase in total revenue reaching $260 million for Q1 2025, and adjusted EBITDA rising 21% to $62.9 million. The company’s stock closed at $9.57 on May 7, 2025, down 2.15% for the day, with a 52-week trading range of $7.70 to $14.92.
Acquisition Strategy & Value Creation
Lucky Strike’s investor presentation emphasized its "secret sauce" for value creation, showcasing a consistent track record of high-return acquisitions. The company detailed three major acquisition success stories that have generated substantial returns over time.
As shown in the following slide, the company’s investment thesis is built around four key pillars: industry leadership, value creation through deals, operational excellence, and management expertise:
The AMF acquisition in 2013 stands as one of the company’s most successful deals. Lucky Strike acquired AMF for an enterprise value of $310 million, contributing just $20 million in equity funding. Through implementation of best practices and cost control measures, the company achieved a 4% revenue CAGR over 11 years despite closing 18% of centers. The 4-Wall EBITDA margin improved dramatically from 26% to 41%, creating an estimated $1.3-1.5 billion in value, representing a 70x+ multiple on invested capital over 11 years.
The following chart illustrates the significant margin improvement achieved with the AMF acquisition:
Similarly, the Brunswick (NYSE:BC) Zone acquisition in 2014 demonstrates Lucky Strike’s effective strategy. The company purchased 85 Brunswick locations for $260 million, immediately entering a sale-leaseback for $200 million to reduce the net purchase price to $60 million. Revenue grew at a 4% CAGR over 10 years despite closing 14% of centers, while the 4-Wall EBITDA margin doubled from 22% to 43%. This created an estimated $800 million to $1 billion in enterprise value, translating to a 15x multiple on invested capital over 10 years.
A more recent example is the Bowl America acquisition in 2021. Lucky Strike acquired 17 locations for $44 million, then sold six underperforming locations for $25 million, resulting in a net purchase price of $19 million. In 2023, the company entered a sale-leaseback with Vici for $63 million. Despite selling 35% of the centers, revenue grew at a 19% CAGR over the first three years, with 4-Wall EBITDA margin improving from 41% to 43%. The estimated value creation exceeds $160 million.
Financial Performance Highlights
Lucky Strike has demonstrated consistent revenue growth, with a compound annual growth rate of 11% from fiscal year 2019 to 2024. Revenue increased from $672 million in FY19 to $1.15 billion in FY24, as shown in the following chart:
The company’s growth strategy has added over 80 locations through acquisitions and new builds from 2018 to 2024. These additions represent $523 million in investment, generating approximately $140 million in EBITDA at a 3.7x multiple. The geographic distribution of these new locations has further strengthened Lucky Strike’s national footprint.
Average unit volumes have also shown consistent growth, increasing from $2.4 million in FY19 to $3.3 million in FY24, representing a 7% CAGR. This growth in per-location revenue reflects the company’s ability to increase wallet share and drive higher average revenue per customer.
Growth Initiatives & Expansion
Lucky Strike currently operates 367 locations across North America, with a diversified portfolio that includes Bowlero, Lucky Strike, AMF/Other, and Boomers branded venues. The company’s recent acquisition of Boomers has provided a platform for expanding into family entertainment centers (FECs), while also adding water parks to its portfolio.
The company’s self-funding model leverages sale-leasebacks to finance acquisitions and drive superior returns. This approach involves acquiring locations with land at 4-7x EBITDAR, improving EBITDAR margins in the first year through operational optimizations, and then executing sale-leasebacks at 12-15x multiples for approximately 50% of EBITDAR. This strategy enables Lucky Strike to continuously add to its unencumbered land portfolio while funding future acquisitions.
Recent acquisitions include Raging Waves, which has shown early success with 88,000 season passes sold compared to 39,000 in the prior year. The company is investing $2-3 million in capital expenditures before the FY25 season to drive revenue per capita increases through improved food offerings and enhanced event sales.
The acquisition of Boomers included water parks such as Big Kahuna’s in Destin, Florida, and Shipwreck Island in Panama City Beach, Florida, further diversifying Lucky Strike’s entertainment portfolio beyond bowling centers.
Forward Outlook
Lucky Strike’s presentation reinforces the company’s commitment to its acquisition-driven growth strategy, with a robust pipeline supporting continued unit growth. The company’s focus on operational excellence and margin improvement has consistently delivered superior returns on invested capital.
In its recent earnings call, Lucky Strike increased its fiscal year 2025 revenue guidance by $10 million, reflecting confidence in its growth trajectory. The company maintains a strong liquidity position of $355 million and a manageable net debt of $1.1 billion.
While the presentation highlights the company’s successes, management acknowledged in the earnings call that some challenges exist, including softness in corporate bookings due to economic uncertainties and seasonal impacts from the Boomers acquisition, which is expected to drag EBITDA by a few million dollars each in Q2 and Q3.
Nevertheless, Lucky Strike’s strategic acquisitions, operational enhancements, and data-driven approach position the company for continued growth in the competitive out-of-home entertainment market. With eleven of fourteen Lucky Strike locations exceeding expectations and event bookings for December pacing 10% higher year-over-year, the company appears well-positioned to maintain its momentum through fiscal year 2025.
Full presentation:
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