RCI Hospitality is the largest publicly traded operator of adult entertainment nightclubs in the U.S., running 59 clubs across 15 states under brands like Rick's Cabaret, Tootsie's Cabaret, and Club Onyx, with heavy concentration in Texas. Nightclubs account for roughly 83% of revenue, generating income from alcohol sales, cover charges, room rentals, and licensing fees paid by entertainers. A key feature of the model is that entertainers work as independent contractors and pay the club licensing fees to perform, a high-margin revenue stream with no direct cost of goods sold — this drives segment gross margins near 89%. RCI's secondary business is Bombshells, a military-themed restaurant and bar chain with 11 locations in Texas, generating roughly 14% of revenue at much lower margins typical of casual dining. RCI also operates a small Media segment that publishes the only national trade magazine for the adult nightclub industry and runs related trade shows and websites. RCI grows primarily by acquiring clubs from aging owner-operators at 3x–5x EBITDA multiples, targeting full cash-on-cash payback in 3–5 years. In December 2024, RCI launched a "Back-to-Basics" strategy targeting $400M in revenue and $75M in free cash flow by FY29, allocating roughly 40% of free cash flow to nightclub acquisitions and 60% to buybacks, debt reduction, and dividends. RCI is also exploring a sale of the Bombshells segment, including its owned real estate.