Grabbing a bite of this temaki right near the support zone feels like a steal—or better yet, a delicious one. If you look back at my April article , you'll see that we've lockedAnalyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no busine ...

Financial Performance - Kura Sushi USA reported quarterly earnings of 5 cents per share, exceeding the analyst consensus estimate of a loss of 1 cent per share [1] - The company achieved quarterly sales of $73.965 million, surpassing the analyst consensus estimate of $71.832 million [1] - Kura Sushi raised its FY2025 sales guidance from a range of $275 million to $279 million, now set at $281 million [1] Management Commentary - Hajime Uba, President and CEO, expressed satisfaction with the third quarter's performance, highlighting the rollout of a new reservation system, exploration of new market opportunities, and development of the IP pipeline [2] - Uba emphasized the team's efforts to capitalize on the summer season and prepare for a strong fiscal 2026 [2] Stock Performance and Analyst Ratings - Following the earnings announcement, Kura Sushi shares fell by 13.2%, trading at $75.00 [2] - Roth Capital analyst George Kelly reiterated a Buy rating and raised the price target from $89 to $106 [8] - Lake Street analyst Mark Smith maintained a Buy rating and increased the price target from $62 to $98 [8] - Barclays analyst Jeffrey Bernstein kept an Equal-Weight rating and raised the price target from $71 to $75 [8]

Kura Sushi (KRUS) came out with quarterly earnings of $0.05 per share, beating the Zacks Consensus Estimate of a loss of $0.02 per share. This compares to break-even earnings per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +350.00%. A quarter ago, it was expected that this company would post a loss of $0.08 per share when it actually produced a loss of $0.14, delivering a surprise of -75%.Over the last four quarters, the compa ...

Financial Data and Key Metrics Changes - Total sales for the fiscal third quarter were $74 million, compared to $63.1 million in the prior year period, representing a growth of approximately 17.5% [15][20] - Comparable sales growth was negative 2.1%, with traffic down 2.9% and price/mix up 0.8% [8][15] - Cost of goods sold as a percentage of sales improved to 28.3% from 29.2% in the prior year quarter [9][17] - Labor costs as a percentage of sales increased to 33.1% from 32.6% in the prior year quarter due to wage inflation [17][19] - Restaurant level operating profit margin was 18.2%, down from 20% in the prior year quarter [9][19] - Adjusted EBITDA increased to $5.4 million from $4.5 million in the prior year quarter, a 20% increase [20] Business Line Data and Key Metrics Changes - The company opened three new restaurants during the third quarter and two more subsequent to the quarter end, achieving its unit development guidance of 14 new restaurants for the fiscal year [9][10] - The class of 2025 restaurants has performed well, with many exceeding expectations shortly after opening [10] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were flat, while the Southwest market saw a decline of 2.5% [15][17] - The company is focusing on smaller DMAs, with successful openings in Bakersfield, California, and plans for further expansion into markets like Des Moines, Richmond, and Tulsa [11] Company Strategy and Development Direction - The company is implementing a new reservation system, which has been rolled out across all restaurants ahead of schedule, and is expected to drive operational efficiencies and improve customer experience [7][13] - There is a renewed focus on intellectual property collaborations, with seven to eight lined up for fiscal 2026, which is a record for the company [11][12] - The company aims to achieve a 50-50 split between new and existing markets by fiscal 2027, with ongoing development in previously unexplored DMAs [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sequential improvement in comparable sales performance each month of the quarter [8][15] - The company is confident in achieving a 20% plus operating margin in fiscal 2026, supported by a strong pipeline of IP collaborations and the reservation system [46][47] - Management noted that labor inflation is expected to moderate in the upcoming quarter, which should help with labor cost leverage [32] Other Important Information - The company has $93 million in cash and no debt at the end of the fiscal third quarter [20] - General and administrative expenses as a percentage of sales were reduced to 11.8% from 14% in the prior year quarter, attributed to lower public company costs and operational efficiencies [18][19] Q&A Session Summary Question: Can you elaborate on the new reservation system and its impact on same-store sales? - Management noted that the reservation system rollout began in late February and showed sequential improvement in sales performance, particularly in May when the first IP campaign was introduced [25][26][29] Question: What are the expectations regarding labor costs and inflation? - The company expects mid to low single-digit labor inflation in Q4, which should improve labor cost leverage if sales are positive [31][32] Question: Can you provide insights on tariff implications and their impact on costs? - Management indicated that they do not foresee a significant impact from tariffs on food and beverage costs, and they are negotiating with suppliers to share any potential cost increases [40][41][42] Question: What is the outlook for restaurant margins moving forward? - Management acknowledged that achieving a 20% margin in fiscal 2025 is challenging but remains confident in reaching that target in fiscal 2026 due to improved sales and operational efficiencies [44][46] Question: How is the company managing general and administrative expenses? - The company is focused on maintaining tight control over hiring and operational efficiencies, which has led to a reduction in G&A expenses as a percentage of sales [79][81] Question: Can you discuss the performance of new store openings? - The class of 2025 openings has been strong, particularly in the Pacific Northwest, and management is optimistic about future openings in new markets [56][57] Question: What are the expectations for the light rice initiative? - The light rice option has been well-received in test markets, and management is confident it will drive increased sales and customer satisfaction [122][124]

Financial Data and Key Metrics Changes - Total sales for the fiscal third quarter were $74 million, compared to $63.1 million in the prior year period, representing a year-over-year increase [14] - Comparable restaurant sales performance was negative 2.1%, with traffic down 2.9% and price and mix positive 0.8% [14] - Cost of goods sold as a percentage of sales improved to 28.3% from 29.2% in the prior year quarter [15] - Labor costs as a percentage of sales increased to 33.1% from 32.6% in the prior year quarter due to wage inflation [15] - Net income was $565,000 or $0.05 per share, compared to a net loss of $558,000 or negative $0.05 per share in the prior year quarter [18] - Adjusted EBITDA increased to $5.4 million from $4.5 million in the prior year quarter, marking a 20% increase [19] Business Line Data and Key Metrics Changes - The company opened three new restaurants during the third quarter and two additional units after the quarter ended, achieving its unit development guidance of 14 new restaurants for the fiscal year [7][8] - Restaurant level operating profit margin was 18.2%, down from 20% in the prior year due to increased labor and occupancy costs [18] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were flat, while the Southwest market experienced a decline of 2.5% [15] - The company is focusing on smaller DMAs, with successful openings in Bakersfield, California, and plans for further expansion into markets like Des Moines, Richmond, and Tulsa [10] Company Strategy and Development Direction - The company aims to achieve a 50-50 split between new and existing markets by fiscal 2027, with ongoing development in previously unexplored DMAs [10] - A new light rice option was introduced to enhance customer experience and potentially drive sales [12] - The company is revamping its marketing strategy with a record number of collaborations planned for fiscal 2026 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sequential improvement in comparable sales performance each month of the quarter [6] - The implementation of the reservation system is expected to drive operational efficiencies and improve customer experience [12] - Management remains cautious about raising guidance too early, reflecting on past experiences [29] Other Important Information - The company has $93 million in cash and no debt at the end of the fiscal third quarter [19] - General and administrative expenses as a percentage of sales are expected to be below 13% for the fiscal year [20] Q&A Session Summary Question: Inquiry about the new reservation system and its impact on same-store sales - Management noted sequential improvement in sales throughout the quarter, with the reservation system rollout contributing positively [25][28] Question: Clarification on tariff implications and cost structure - Management indicated that they are currently assessing the impact of tariffs, with 45% of their basket sourced from Japan, Korea, and Vietnam [40][42] Question: Discussion on restaurant margins and future outlook - Management acknowledged the difficulty in achieving a 20% margin for fiscal 2025 but remains confident in returning to that level in fiscal 2026 [46][48] Question: Insights on new store productivity and market expansion - The company reported that the Class of 2025 openings are performing strongly, particularly in the Pacific Northwest [57] Question: Update on technology initiatives and operational efficiencies - Management highlighted the potential of the robotic dishwasher and ongoing improvements to the reservation system to enhance operational efficiency [109][110]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed financial statements for the period ended May 31, 2025, detailing asset growth to **$419.4 million**, a **17.3%** quarterly sales increase yielding **$0.6 million** net income, and significant financing inflows despite a **$4.2 million** nine-month net loss [Condensed Balance Sheets](index=4&type=section&id=Condensed%20Balance%20Sheets) Balance Sheet Highlights (as of May 31, 2025) | Metric | May 31, 2025 (in thousands) | August 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $47,132 | $50,986 | | Total current assets | $72,026 | $61,335 | | Property and equipment – net | $164,909 | $138,589 | | Total assets | $419,373 | $328,522 | | **Liabilities & Equity** | | | | Total current liabilities | $38,548 | $34,499 | | Total liabilities | $192,369 | $165,984 | | Total stockholders' equity | $227,004 | $162,538 | - Total assets increased by **27.7%** to **$419.4 million**, primarily due to growth in property and equipment and the addition of **$45.9 million** in short-term and long-term investments[9](index=9&type=chunk) - Total stockholders' equity grew by **39.7%** to **$227.0 million**, mainly as a result of a follow-on public offering which increased additional paid-in capital[9](index=9&type=chunk)[14](index=14&type=chunk) [Condensed Statements of Operations](index=5&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) Statement of Operations Summary | Metric | Three Months Ended May 31, 2025 (in thousands) | Three Months Ended May 31, 2024 (in thousands) | Nine Months Ended May 31, 2025 (in thousands) | Nine Months Ended May 31, 2024 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Sales | $73,965 | $63,082 | $203,315 | $171,848 | | Operating Loss | $(162) | $(1,169) | $(6,225) | $(5,700) | | Net Income (Loss) | $565 | $(558) | $(4,177) | $(3,603) | | Diluted EPS | $0.05 | $(0.05) | $(0.35) | $(0.32) | - For the third quarter of fiscal 2025, sales grew **17.3%** year-over-year, and the company shifted from a net loss to a net income of **$565 thousand**[11](index=11&type=chunk) - For the nine months ended May 31, 2025, sales increased by **18.3%** year-over-year, but the net loss widened to **$4.2 million** from **$3.6 million** in the prior year period[11](index=11&type=chunk) [Condensed Statements of Cash Flows](index=9&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) Cash Flow Summary (Nine Months Ended May 31) | Cash Flow Activity | 2025 (in thousands) | 2024 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $15,338 | $14,943 | | Net cash used in investing activities | $(84,183) | $(27,257) | | Net cash provided by financing activities | $64,991 | $2,022 | | **Decrease in cash and cash equivalents** | **$(3,854)** | **$(10,292)** | - Cash from financing activities surged to **$65.0 million** due to net proceeds of **$64.4 million** from a follow-on public offering[18](index=18&type=chunk)[21](index=21&type=chunk) - Cash used in investing activities increased significantly to **$84.2 million**, driven by **$70.2 million** in purchases of investments and **$36.7 million** for property and equipment[18](index=18&type=chunk) [Notes to Condensed Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) - In November 2024, the company completed a follow-on public offering, raising net proceeds of **$64.4 million** to be used for general corporate purposes, including capital expenditures[21](index=21&type=chunk) - The company pays its parent, Kura Japan, a royalty fee of **0.5%** of net sales. For the nine months ended May 31, 2025, total payments to Kura Japan for royalties, equipment, and other services amounted to **$5.2 million**[40](index=40&type=chunk)[41](index=41&type=chunk) - The company has settled several employee wage claims for a total of approximately **$7.2 million** since August 2024 and is currently facing a new putative class action lawsuit filed in December 2024[49](index=49&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk) - The revolving credit agreement with Kura Japan was extended in April 2025, pushing the availability period to April 10, 2028. As of May 31, 2025, the full **$45.0 million** credit line remains available with no outstanding balance[45](index=45&type=chunk)[46](index=46&type=chunk) [Management's Discussion and Analysis (MD&A)](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reports an **18.3%** increase in nine-month sales to **$203.3 million** driven by new restaurants, despite a **1.7%** decline in comparable sales, with liquidity bolstered by a **$64.4 million** offering to support expansion [Overview and Business Trends](index=22&type=section&id=Overview%20and%20Business%20Trends) - The company expanded its footprint by opening **13** new restaurants in the first nine months of fiscal 2025, bringing the total to **76** restaurants across 20 states and Washington, D.C[64](index=64&type=chunk) - The company plans to open a total of **15** new restaurants in fiscal year 2025 and anticipates that revenue, operating costs, and G&A expenses will increase accordingly to support this growth[64](index=64&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Q3 FY2025 vs. Q3 FY2024 Performance | Metric | Q3 2025 (in millions) | Q3 2024 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Sales | $74.0 | $63.1 | +$10.9 | +17.3% | | Operating Loss | $(0.2) | $(1.2) | +$1.0 | -86.1% | | Net Income (Loss) | $0.6 | $(0.6) | +$1.2 | +201.3% | Nine Months FY2025 vs. Nine Months FY2024 Performance | Metric | YTD 2025 (in millions) | YTD 2024 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Sales | $203.3 | $171.8 | +$31.5 | +18.3% | | Operating Loss | $(6.2) | $(5.7) | -$0.5 | -9.2% | | Net Loss | $(4.2) | $(3.6) | -$0.6 | +15.9% | - For the nine months ended May 31, 2025, food and beverage costs as a percentage of sales decreased to **28.6%** from **29.5%** YoY, due to menu price increases and supply chain initiatives[77](index=77&type=chunk)[89](index=89&type=chunk) - Labor costs as a percentage of sales for the nine-month period increased to **33.6%** from **32.5%** YoY, primarily due to higher wage rates[77](index=77&type=chunk)[90](index=90&type=chunk) [Key Performance Indicators (KPIs)](index=29&type=section&id=Key%20Performance%20Indicators) Non-GAAP Performance Metrics (Nine Months Ended May 31) | Metric | 2025 (in millions) | 2024 (in millions) | | :--- | :--- | :--- | | Adjusted EBITDA | $11.7 | $9.1 | | Adjusted EBITDA Margin | 5.7% | 5.3% | | Restaurant-level Operating Profit | $36.4 | $33.9 | | Restaurant-level Operating Profit Margin | 17.9% | 19.7% | Comparable Restaurant Sales Performance | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended May 31 | (2.1)% | 0.6% | | Nine Months Ended May 31 | (1.7)% | 2.4% | - For the nine months ended May 31, 2025, the comparable restaurant sales decrease of **1.7%** was composed of a **4.2%** decline in traffic offset by a **2.5%** positive price/mix[88](index=88&type=chunk) - The company opened **12** restaurants in the first nine months of fiscal 2025, compared to **13** in the same period of fiscal 2024, ending the period with **76** total restaurants[114](index=114&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) - The company believes its cash on hand, cash from operations, and investments are sufficient to fund needs for at least the next 12 months[116](index=116&type=chunk) - In November 2024, a public offering of common stock generated net proceeds of **$64.4 million**, strengthening the company's capital resources[119](index=119&type=chunk) - As of May 31, 2025, the company had no outstanding balance on its **$45.0 million** revolving credit line with Kura Japan, which was recently extended to 2028[116](index=116&type=chunk)[118](index=118&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes to its market risk exposure, including commodity price fluctuations and interest rate changes, since its last Annual Report on Form 10-K - No material changes to market risk were reported for the nine months ended May 31, 2025[132](index=132&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of May 31, 2025, with no material changes to internal control over financial reporting identified during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of the end of the quarter[134](index=134&type=chunk) - No changes occurred in the company's internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[135](index=135&type=chunk) [PART II. OTHER INFORMATION](index=38&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company refers to Note 8 for legal matters, detailing **$7.2 million** in employee wage claim settlements and an ongoing putative class action lawsuit with an unestimable potential loss - Details on legal proceedings are incorporated by reference from Note 8 of the financial statements[137](index=137&type=chunk) - The company has settled multiple employee claims related to wage laws for approximately **$7.2 million** and is defending a new putative class action complaint in California[49](index=49&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) The company highlights no material changes to overall risk factors but emphasizes vulnerability to food and supply costs, particularly due to sole reliance on Kura Japan for proprietary rice vinegar and potential supply chain disruptions - The company's profitability is vulnerable to changes in food and supply costs and the availability of key products[139](index=139&type=chunk) - A specific dependency risk is noted, as Kura Japan is the sole supplier of the company's proprietary rice vinegar[139](index=139&type=chunk) - Supply chain disruptions could force menu changes, cause shortages, and lead to significant reductions in sales[140](index=140&type=chunk) [Other Items (Items 2, 3, 4, 5)](index=38&type=section&id=Other%20Items) This section reports no unregistered equity sales or senior security defaults, and discloses that the CEO and CDO adopted Rule 10b5-1 trading plans for potential stock sales beginning January 2026 - No unregistered sales of equity securities or defaults on senior securities were reported during the period[141](index=141&type=chunk)[142](index=142&type=chunk) - In May 2025, CEO Hajime Uba and CDO Robert Kluger adopted Rule 10b5-1 trading plans for potential future sales of company stock, scheduled to commence no earlier than January 16, 2026[144](index=144&type=chunk)[146](index=146&type=chunk)

[Q3 2025 Financial Highlights](index=1&type=section&id=Fiscal%20Third%20Quarter%202025%20Highlights) Kura Sushi reported total sales of $74.0 million, a significant increase from the previous year, achieved a net income of $0.6 million, and opened three new restaurants, despite a 2.1% decrease in comparable restaurant sales Q3 2025 Key Performance Indicators (vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | | :--- | :--- | :--- | | Total Sales | $74.0 million | $63.1 million | | Comparable Restaurant Sales | -2.1% | N/A | | Operating Loss | $0.2 million | $1.2 million | | Net Income (Loss) | $0.6 million | $(0.6) million | | Diluted EPS | $0.05 | $(0.05) | | Adjusted Net Income | $0.6 million | $4 thousand | | Restaurant-level Operating Profit* | $13.5 million | N/A | | Adjusted EBITDA* | $5.4 million | N/A | | New Restaurants Opened | 3 | N/A | - CEO Hajime Uba expressed satisfaction with the quarter's results, highlighting progress in the new reservation system, exploration of new market opportunities, and strategy for Bikkurapon collaborations to prepare for fiscal 2026[4](index=4&type=chunk) [Detailed Financial Analysis (Q3 2025)](index=1&type=section&id=Review%20of%20Fiscal%20Third%20Quarter%202025%20Financial%20Results) The company's total sales grew due to new restaurant openings, though comparable sales declined, while the operating loss narrowed significantly and the company swung to a net profit, with improved food and beverage expenses as a percentage of sales, but increased labor costs [Sales and Profitability](index=1&type=section&id=Sales%20and%20Profitability) Total sales increased by 17.3% to $74.0 million, primarily driven by the opening of thirteen new restaurants, partially offset by a 2.1% decrease in comparable restaurant sales, leading to a turnaround from a prior-year net loss to a net income of $0.6 million Q3 Sales and Profitability Comparison (in millions) | Metric | Q3 2025 | Q3 2024 | Change | | :--- | :--- | :--- | :--- | | Total Sales | $74.0 | $63.1 | +17.3% | | Comparable Restaurant Sales | -2.1% | N/A | N/A | | Operating Loss | $(0.2) | $(1.2) | +82.9% | | Net Income (Loss) | $0.6 | $(0.6) | Turnaround to Profit | - The **2.1% decrease** in comparable restaurant sales was composed of a **2.9% decrease** in traffic, partially offset by a **0.8% increase** from price and product mix[5](index=5&type=chunk) [Cost Structure Analysis](index=1&type=section&id=Cost%20Structure%20Analysis) Food and beverage costs improved to 28.3% of sales from 29.2% year-over-year, while labor costs rose to 33.1% of sales from 32.6%, and General and Administrative (G&A) expenses decreased to 11.8% of sales from 14.0% Cost as a Percentage of Sales | Cost Category | Q3 2025 | Q3 2024 | | :--- | :--- | :--- | | Food and Beverage | 28.3% | 29.2% | | Labor and Related | 33.1% | 32.6% | | Other Costs | 14.7% | 14.1% | | General & Administrative | 11.8% | 14.0% | - The decrease in G&A expenses as a percentage of sales was primarily due to sales leverage and a reduction in professional fees and litigation expenses[9](index=9&type=chunk) - Occupancy expenses increased in absolute terms to **$5.5 million** from **$4.3 million**, driven by the opening of thirteen new restaurants since Q3 2024[7](index=7&type=chunk) [Restaurant Development](index=2&type=section&id=Restaurant%20Development) Kura Sushi continued its expansion by opening three new restaurants during the third quarter in Arizona, Washington, and Texas, with two additional restaurants opened subsequent to the quarter's end, bringing the total to 78 locations - **Three new restaurants** were opened during Q3 2025 in: - Scottsdale, Arizona - Lynnwood, Washington - McKinney, Texas[12](index=12&type=chunk) - Subsequent to the quarter end (May 31, 2025), **two more restaurants** were opened in The Woodlands, Texas and Salt Lake City, Utah[12](index=12&type=chunk) [Fiscal Year 2025 Outlook](index=2&type=section&id=Fiscal%20Year%202025%20Outlook) The company updated its full-year guidance for fiscal 2025, projecting total sales of approximately $281 million, planning to open 15 new restaurants, and expecting general and administrative expenses to be below 13.0% of sales Updated FY 2025 Guidance | Metric | Guidance | | :--- | :--- | | Total Sales | Approx. $281 million | | New Restaurants | 15 (annual unit growth > 20%) | | Avg. Net Capex per Unit | Approx. $2.5 million | | G&A Expenses (% of Sales) | Below 13.0% (excl. legal settlements) | [Financial Statements](index=6&type=section&id=Financial%20Statements) This section provides the detailed, unaudited financial statements for the third quarter and nine months ended May 31, 2025, including the income statement, selected balance sheet and operating data, and reconciliations of GAAP to non-GAAP measures [Statements of Operations](index=6&type=section&id=Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) For the three months ended May 31, 2025, the company reported sales of $74.0 million and a net income of $0.6 million, or $0.05 per diluted share, a significant improvement from the same period in 2024, which saw sales of $63.1 million and a net loss of $0.6 million Consolidated Statements of Operations (in thousands, for Three Months Ended May 31) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Sales | $73,965 | $63,082 | | Total operating expenses | $74,127 | $64,251 | | **Operating loss** | **$(162)** | **$(1,169)** | | Income (loss) before income taxes | $620 | $(498) | | **Net income (loss)** | **$565** | **$(558)** | | Diluted EPS | $0.05 | $(0.05) | [Selected Balance Sheet and Operating Data](index=7&type=section&id=Selected%20Balance%20Sheet%20Data%20and%20Selected%20Operating%20Data) As of May 31, 2025, the company held $47.1 million in cash and cash equivalents and had total assets of $419.4 million, with the total number of restaurants growing to 76, while restaurant-level operating profit margin was 18.2% and Adjusted EBITDA margin slightly increased to 7.3% Selected Balance Sheet Data (in thousands) | Account | May 31, 2025 | August 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $47,132 | $50,986 | | Total assets | $419,373 | $328,522 | | Total liabilities | $192,369 | $165,984 | | Total stockholders' equity | $227,004 | $162,538 | Selected Operating Data (for Three Months Ended May 31) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Restaurants at end of period | 76 | 63 | | Comparable restaurant sales | (2.1)% | 0.6% | | Adjusted EBITDA | $5,410 | $4,451 | | Restaurant-level operating profit | $13,492 | $12,604 | | Restaurant-level operating profit margin | 18.2% | 20.0% | [Reconciliation of Non-GAAP Measures](index=8&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) The company provides reconciliations for its non-GAAP metrics, showing Adjusted Net Income of $0.6 million, Adjusted EBITDA of $5.4 million, and Restaurant-level operating profit of $13.5 million for Q3 2025 Reconciliation to Adjusted EBITDA (Q3 2025, in thousands) | Line Item | Amount | | :--- | :--- | | Net income | $565 | | Interest income, net | $(782) | | Income tax expense | $55 | | Depreciation and amortization | $3,559 | | **EBITDA** | **$3,397** | | Stock-based compensation | $1,293 | | Non-cash lease expense | $720 | | Litigation | $— | | **Adjusted EBITDA** | **$5,410** | Reconciliation to Restaurant-level Operating Profit (Q3 2025, in thousands) | Line Item | Amount | | :--- | :--- | | Operating loss | $(162) | | Add: Depreciation & amortization | $3,559 | | Add: Stock-based compensation | $1,293 | | Add: Pre-opening costs | $404 | | Add: Non-cash lease expense | $720 | | Add: General & administrative | $8,741 | | Less: Corp-level stock comp | $(1,063) | | **Restaurant-level operating profit** | **$13,492** |

Core Insights - Kura Sushi USA, Inc. reported financial results for the fiscal third quarter ended May 31, 2025, highlighting a total sales increase to $74.0 million from $63.1 million in the same quarter of 2024, despite a 2.1% decrease in comparable restaurant sales [5][10][11]. Financial Performance - Total sales reached $74.0 million, a 17.5% increase from $63.1 million in Q3 2024 [5][10]. - Comparable restaurant sales decreased by 2.1%, driven by a 2.9% decline in traffic and a 0.8% increase in price/mix [5][10]. - Net income was $0.6 million, or $0.05 per diluted share, compared to a net loss of $0.6 million, or $(0.05) per diluted share, in Q3 2024 [9][10]. - Adjusted net income was $0.6 million, or $0.05 per diluted share, compared to an adjusted net income of $4,000, or $0.00 per diluted share, in Q3 2024 [11][31]. - Restaurant-level operating profit was $13.5 million, representing 18.2% of sales, down from $12.6 million, or 20.0% of sales, in Q3 2024 [11][30]. - Adjusted EBITDA was $5.4 million, an increase from $4.5 million in Q3 2024 [11][33]. Cost Structure - Food and beverage costs as a percentage of sales decreased to 28.3% from 29.2% in Q3 2024, attributed to menu price increases and supply chain initiatives [6]. - Labor and related costs increased to 33.1% of sales from 32.6% in Q3 2024, primarily due to rising wage rates [6]. - Occupancy and related expenses rose to $5.5 million from $4.3 million in Q3 2024, mainly due to the opening of thirteen new restaurants [7]. - General and administrative expenses were $8.7 million, slightly down from $8.9 million in Q3 2024, with a decrease in percentage of sales to 11.8% from 14.0% [8]. Restaurant Development - The company opened three new restaurants during the fiscal third quarter of 2025, located in Scottsdale, Arizona; Lynnwood, Washington; and McKinney, Texas [12]. - Following the quarter, two additional restaurants were opened in The Woodlands, Texas, and Salt Lake City, Utah [12]. Fiscal Year 2025 Outlook - For the full fiscal year of 2025, the company anticipates total sales of approximately $281 million and plans to open 15 new restaurants, maintaining an annual unit growth rate above 20% [18].

Core Insights - The article emphasizes the investment philosophy focused on small cap companies, highlighting the importance of identifying mispriced securities through understanding financial drivers and utilizing DCF model valuation [1] Group 1: Investment Philosophy - The investment approach is not confined to traditional categories such as value, dividend, or growth investing, but rather considers all prospects of a stock to assess risk-to-reward [1] Group 2: Market Focus - The investment strategy encompasses markets in the US, Canada, and Europe, indicating a broad geographical focus for potential investment opportunities [1]

Kura Sushi USA, Inc. KRUS will release earnings results for the third quarter, before the opening bell on Tuesday, July 8.Analysts expect the Irvine, California-based company to report quarterly loss at 1 cent per share. KRUS projects to report quarterly revenue of $71.82 million, compared to $63.08 million a year earlier, according to data from Benzinga Pro.On April 8, Kura Sushi USA reported a quarterly loss of 14 cents per share which missed the analyst consensus estimate of loss of 13 cents per share. T ...