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Investing.com -- Lovesac (NASDAQ:LOVE) stock declined 12% after the home furnishings company issued second quarter guidance that fell short of analyst expectations.
The Lovesac Company reported a first-quarter loss of $0.73 per share, which was better than the analyst estimate of an $0.80 loss. Revenue for the quarter came in at $138.37 million, slightly below the consensus estimate of $138.61 million but up 4.3% compared to the same quarter last year.
The company’s outlook for the current fiscal year disappointed investors. Lovesac forecasts full-year earnings per share between $0.80 and $1.36, with the midpoint aligning with the consensus of $1.08. Revenue is expected to be in the range of $700-750 million, compared to analyst estimates of $719.7 million.
For the second quarter, Lovesac projects revenue between $157-166 million, in line with the consensus of $162.3 million. However, the company expects a second-quarter loss per share of $0.58 to $0.83, significantly worse than analysts’ expectations of a $0.27 loss per share.
Despite the stock decline, Lovesac reported some positive developments in the first quarter. The company achieved a 2.8% increase in omni-channel comparable net sales and opened a net of 10 new showrooms. Gross profit increased by 3.2% to $74.4 million, though gross margin decreased slightly to 53.7% from 54.3% YoY due to higher promotional discounting.
The company also highlighted the recent launch of its third "Designed For Life Platform," called EverCouch, which expands its product line into armchairs, loveseats and sofas, potentially doubling its total addressable market.
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