The ONE Group (NASDAQ:STKS) Misses Q3 Sales Expectations

Core Insights - The One Group Hospitality (NASDAQ:STKS) missed Wall Street's revenue expectations in Q3 CY2025, reporting a 7.1% year-on-year decline in sales to $180.2 million, which was below the analyst estimates of $191.1 million [1][8] - The company's full-year revenue guidance was lowered to $822.5 million at the midpoint, which is 1.5% below analysts' estimates and reflects a 3.5% decrease from previous guidance [1][8] - The GAAP loss per share was reported at $2.75, significantly missing the consensus estimate of -$0.44 [1][8] Company Overview - The One Group Hospitality operates upscale dining establishments, including STK Steakhouse and Kona Grill, and also provides hospitality services for hotels and resorts [3] Revenue Performance - The One Group's revenue for the past 12 months stands at $820.6 million, indicating it is a small restaurant chain that may face disadvantages compared to larger competitors but has potential for faster growth due to more opportunities for new restaurant openings [5] - The company experienced a remarkable annualized revenue growth of 43.4% over the last six years, normalized for COVID-19 impacts, indicating strong demand [6] Financial Highlights - Q3 CY2025 results included an adjusted EBITDA of $10.56 million, which was below analyst expectations of $16.75 million, resulting in a 5.9% margin [8] - The operating margin fell to -4.4%, down from 2.1% in the same quarter last year, and same-store sales declined by 5.9% year-on-year [8] Future Outlook - Analysts project a revenue growth of 5.3% over the next 12 months, which represents a deceleration compared to the previous six years, suggesting potential demand challenges for the company's menu offerings [9]