Thu, Sep 12, 12:31 PM (124 days ago)
In the second quarter of fiscal 2025, The Lovesac Company reported a slight increase in net sales to $156.6 million, driven by new showroom openings, despite a 5.4% decline in omni-channel comparable sales. The gross profit remained stable at $92.4 million, but gross margin decreased to 59.0%. Operating expenses surged 15.4% to $100.7 million, primarily due to rising payroll and equity-based compensation, resulting in an operating loss of $8.4 million. The net loss widened to $5.9 million, compared to a loss of $0.6 million in the prior year. For the first half of the fiscal year, total net sales fell 2.2% to $289.2 million, with comparable sales down 10%. Gross profit increased slightly, reflecting improved inbound transportation costs, but SG&A expenses rose 18%. Cash flows from operations turned negative at $0.8 million, contrasting with $27.3 million in the prior year, influenced by higher net losses and working capital changes. As of August 4, 2024, cash and equivalents stood at $72.1 million, with no outstanding borrowings on a $36 million credit line. The company initiated a $40 million share repurchase program in June 2024.