Lovesac (LOVE) Fiscal Q2 2027 Earnings Call: Tariff Benefit and Product Outlook
Source Tradingkey
Key takeaways
- Fiscal Q2 2027 net sales increased 0.4% to $161.2 million, the company’s highest second-quarter revenue on record, while omnichannel comparable sales declined 1.9%.
- Gross margin rose 1,200 basis points to 68.4%, primarily due to $20 million of IEPA tariff refunds recognized in cost of merchandise sold. Excluding tariff recoveries, gross margin was approximately 56%, down 40 basis points.
- Net income reached $7.4 million, or $0.51 per diluted share, versus a $6.7 million loss, or $0.45 per share, a year earlier. The tariff refunds contributed a net benefit of $0.86 per diluted share.
- Demand remained stronger for configurations above $6,000, including larger Sactionals setups, premium fabrics and new features. The below-$6,000 segment improved but did not return to growth.
- Management expects several product launches to have limited impact in late Q3 and a more meaningful contribution in Q4. This timing shift, along with ongoing pricing tests, informed a more conservative outlook.
- Lovesac guided to fiscal 2027 net sales of $690 million to $710 million and Adjusted EBITDA of $31.5 million to $35.5 million.
Core financial data
| Metric | Fiscal Q2 2027 | Year-over-year change / context |
|---|---|---|
| Net sales | $161.2 million | Up 0.4% |
| Omnichannel comparable sales | — | Down 1.9% |
| Showroom net sales | $114.1 million | Up 4.6% |
| Internet net sales | $40.2 million | Down 5.3% |
| Gross margin | 68.4% | Up 1,200 bps, primarily due to tariff refunds |
| Gross margin excluding tariff recoveries | Approximately 56% | Down 40 bps |
| SG&A expense | $72.3 million | Up 0.3%; 44.8% of sales |
| Advertising and marketing expense | $22.8 million | Down $0.7 million; ratio improved 50 bps |
| Operating income | $10.9 million | Versus an $8.8 million operating loss |
| Net income | $7.4 million | Versus a $6.7 million net loss |
| Diluted EPS | $0.51 | Versus a loss of $0.45; included a $0.86 tariff-refund benefit |
| Adjusted EBITDA | Loss of $1.3 million | Excludes the $20 million tariff-refund benefit |
| Cash and cash equivalents | $68.8 million | No outstanding debt |
| Inventory | $130.2 million | Versus $124.0 million a year earlier |
| Operating cash flow | Use of $11.4 million | Improved from a use of $29.2 million |
Disclaimer: For information purposes only. Past performance is not indicative of future results.
Recommended Articles
After its strongest August since 2017, Bitcoin (BTC) has faced renewed volatility in September as hawkish Fed signals and strong jobs data pressure risk assets.Yet, the daily chart has flashed a key b
The US Treasury walked into the bond market on Wednesday with $6 billion. It was triple its usual size, and the biggest such offer in years. The market took one look and sold.While yields were suppose
President Donald Trump said Wednesday that oil prices will not fall until right after the November midterm elections. He tied relief at the pump to an Iran war he expects Tehran to abandon once Americ
Altcoin perpetual futures carried more open interest than Bitcoin’s on September 6, the first such flip since December 2024, according to Coinalyze data. That crossover comes even as Bitcoin’s own ral
US stocks fell for a third straight session on Wednesday. Rising Treasury yields and another jump in oil prices weighed on sentiment.The Dow Jones Industrial Average dropped 405.41 points, or 0.77%, t
