Shares of Dave & Buster's Entertainment (NASDAQ: PLAY) soared 5% in pre-market trading on Tuesday following the company's Q4 2024 earnings call, where management outlined a comprehensive turnaround strategy and reported improving business trends.

While the entertainment and dining chain faced challenges in Q4, with comparable store sales declining 9.4% year-over-year, investors appear encouraged by the company's plans to address recent missteps and return to growth. Interim CEO Kevin Sheehan emphasized a "back to basics" approach, which includes reintroducing TV advertising, bringing back popular promotions like the "Eat & Play Combo," and rolling out new games to drive traffic.

The company also reported "markedly better" results in March and April 2025, with improvements in both traffic and food and beverage sales. This positive momentum, combined with a more disciplined capital expenditure plan for fiscal 2025, seems to have boosted investor confidence. Dave & Buster's plans to limit capital expenditures to $220 million in the upcoming fiscal year, focusing on high-return investments in new stores, game refreshes, and targeted remodels. The company's commitment to generating free cash flow while maintaining growth initiatives appears to be resonating with the market.