Financial research concept

Entertainment Venue Entertainment Cost Rate

measures direct entertainment product costs as a percentage of entertainment revenue.

By Lee BaileyPublished Sep 26, 2026

Research context

See what supports this page, how current it is, and where comparable or historical context is available.

Research date: Sep 26, 2026Use the dated article and cited sources for the definition, examples, and stated limitations.
Operating-model context: 17 connected conceptsPart of the reviewed Entertainment Venue Store Economics; issuer definitions remain distinct where disclosed.
Company examples: 1 reviewed companyRelationships reflect supported examples, not a normalized cross-company KPI ranking.

The denominator is entertainment revenue, not company revenue
Lower redemption cost helped the rate improve
A low direct product cost does not equal a high store margin
Part of the Entertainment Venue Store Economics
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Entertainment venue entertainment cost rate measures direct entertainment product costs as a percentage of entertainment revenue.

Dave & Buster's reported $107.1 million of entertainment cost in fiscal 2025, equal to 8.1% of entertainment revenue, versus 8.5% in fiscal 2024.

The denominator is entertainment revenue, not company revenue

Dave & Buster's separately reports food-and-beverage product cost against food-and-beverage revenue. The 8.1% entertainment rate therefore cannot be compared directly with store payroll or other store operating expense rates, which use total revenue as their denominator.

This denominator discipline is essential when reconstructing venue economics.

Lower redemption cost helped the rate improve

Management attributed the improvement primarily to vendor cost savings and lower redemptions following ticket-payout adjustments and redemption-center pricing changes. Tariff pressure in the second half of fiscal 2025 partly offset those benefits.

That explanation shows why the rate is not simply a function of game pricing. Prize economics, payout settings, vendor costs, and tariffs can all change the direct cost attached to entertainment revenue.

A low direct product cost does not equal a high store margin

Entertainment revenue still has to support payroll, occupancy, maintenance, marketing, utilities, depreciation, and other operating costs.

Use this metric with entertainment revenue mix, payroll rate, and other store operating expense rate to understand the broader store cost structure.

Primary source: Dave & Buster's fiscal 2025 Form 10-K.

Part of the Entertainment Venue Store Economics

Connects entertainment and dining revenue mix with product-cost rates, comparable-store performance, new-store development and maturation, operating-cost leverage, pre-opening expense, and capital reinvestment for large-format entertainment venues.

Browse the full operating model in Company Analysis →

Where this concept fits

Revenue mix, direct product costs, and store-level operating leverageCurrent relationship
Entertainment and food-and-beverage revenue mix show what customers spend on inside the venue. Their direct product cost rates preserve different denominators, while payroll and other store operating expense rates show additional store-level cost intensity against total revenue.
Entertainment Cost RateCurrent conceptEntertainment Revenue Entertainment Revenue Mix Food & Beverage Cost Rate Food & Beverage Revenue Food & Beverage Revenue Mix Operating Payroll Rate Other Store Operating Expense Rate
Seasoned-store performance, noncomparable exposure, and new-store maturation
Comparable-store sales growth measures the seasoned base, while comparable and noncomparable operating weeks expose the time contribution behind each population. The comparable-store base count and honeymoon effect help distinguish mature-store performance from early new-store sales patterns.
Comparable Store Base Count Comparable Store Operating Weeks Comparable Store Sales Growth New Store Honeymoon Effect Noncomparable Store Operating Weeks
Footprint expansion, launch expense, and capital reinvestment
Ending company-owned store count and new-store openings show the physical venue base and expansion flow. Pre-opening costs capture launch expense before operations begin, while capital expenditures show cash invested in new stores, remodels, games, technology, and other property and equipment.
Capital Expenditures Company-Owned Store Count New Store Openings Pre-Opening Costs

See It in Company Research

These companies are examples of how the concept is reported or discussed in public filings. Definitions can differ by issuer; these links open company research rather than a normalized metric comparison.

PLAYOpen operating-model research →17 of 17 reviewed concepts in Entertainment Venue Store EconomicsRevenue mix, direct product costs, and store-level operating leverage8 of 8 bridge concepts supportedContinue through this bridge:Entertainment Revenue Entertainment Revenue Mix Food & Beverage Cost Rate Food & Beverage Revenue Food & Beverage Revenue Mix Operating Payroll Rate Other Store Operating Expense Rate

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Compare entertainment product economics

Compare direct game and redemption costs separately from payroll, occupancy, and broader store expenses.

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