The Lovesac Company Reports Third Quarter Fiscal 2026 Financial Results

Rhea-AI Summary

The Lovesac Company (NASDAQ: LOVE) reported Q3 FY26 results for the quarter ended November 2, 2025. Net sales were $150.2M, up 0.2% year‑over‑year, driven by a net addition of 17 showrooms and omni‑channel comps down 1.2%. Gross margin declined 240 bps to 56.1% due to higher inbound transportation and tariff costs. Q3 net loss widened to $10.6M (loss per share $(0.72)) and Adjusted EBITDA was $(6.0)M. Cash was $23.7M versus $61.7M a year earlier; inventory rose to $129.7M. Full‑year FY26 guidance: net sales $685–705M, Adjusted EBITDA $37–43M, net income $2–8M. Q4 guidance: net sales $236–256M, Adjusted EBITDA $51–56M, net income $30–36M.

Positive

• Net sales +0.2% to $150.2M (Q3 FY26)
• Net addition of 17 showrooms year‑to‑date (275 total)
• Full‑year guidance: net sales $685–705M

Negative

• Gross margin down 240 bps to 56.1% (Q3) due to tariffs and freight
• Q3 net loss widened to $10.6M (from $4.9M)
• Cash balance decreased to $23.7M from $61.7M year‑over‑year
• Adjusted EBITDA $(6.0)M in Q3 and $(13.6)M year‑to‑date

Key Figures

Q3 FY26 Net Sales $150.2M Up 0.2% vs Q3 FY25 net sales of $149.9M

Q3 Gross Margin 56.1% Down from 58.5% in Q3 FY25 (240 bps decline)

Q3 Net Loss $10.6M Wider than prior-year net loss of $4.9M

Q3 Adjusted EBITDA -$6.0M Down from positive $2.7M in Q3 FY25

Cash Balance $23.7M As of Nov 2, 2025 vs $61.7M a year earlier

Merchandise Inventory $129.7M Up from $113.4M as of Nov 3, 2024

FY26 Net Sales Guidance $685–705M Updated full-year FY26 outlook vs prior $700–750M range

FY26 Net Income Guidance $2–8M Updated FY26 outlook vs prior $13–22M range

Market Reality Check

$15.18 Last Close

Volume Volume 1,207,693 is 2.24x the 20-day average of 540,321, indicating elevated pre-news activity. high

Technical Shares at $13.74 were trading below the 200-day MA of $17.52, reflecting a pre-existing downtrend.

Peers on Argus 1 Down

Among key peers, several moved higher (e.g., COOK up 16.27%, SNBR up 8.7%, HBB up 4.94%), while LOVE was down 1.51% pre-announcement, suggesting stock-specific pressure rather than a uniform sector move.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Sep 11	Q2 FY26 earnings	Positive	+0.0%	Net sales grew 2.5% and omni-channel comps rose, but margins declined.
Jun 12	Q1 FY26 earnings	Positive	+0.0%	Sales up 4.3% and operating loss improved, with new product launches.
Apr 10	Q4 FY25 earnings	Positive	+0.0%	Higher net income, strong cash balance and positive FY26 guidance range.
Dec 12	Q3 FY25 earnings	Negative	+0.0%	Net sales declined and net loss widened despite better gross margin.

Pattern Detected

Earnings releases have tended to produce large moves, with several cases where positive or growth-oriented updates were followed by sharp post-earnings declines.

Recent Company History

Over the past year, Lovesac’s earnings reports have shown modest net sales growth but pressured margins and recurring losses. Q4 FY25 delivered higher net income of $35.3M and a strong positive price reaction, while Q1 and Q2 FY26 featured net sales growth yet sharp selloffs of -17.98% and -14.84%. The prior Q3 FY25 report, with declining sales and a wider loss, triggered a -31.69% move. Today’s Q3 FY26 release continues the theme of slight top-line growth alongside margin compression and losses, now paired with a meaningfully lowered FY26 outlook versus earlier in the year.

Market Pulse Summary

The stock moved -7.8% in the session following this news. A negative reaction despite mixed fundamentals fits prior patterns where earnings with growth elements still saw sharp selloffs, such as the -17.98% and -14.84% moves after Q1 and Q2 FY26. Q3 FY26 delivered only 0.2% net sales growth to $150.2M, a gross margin drop to 56.1%, and a wider net loss, alongside FY26 guidance cut to $685–705M in sales and $2–8M in net income, giving the market several pressure points to focus on.

Key Terms

adjusted EBITDA financial

"Adjusted EBITDA 1 | $(6.0) | | $2.7 | | (322.9 %) |"

Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.

omni-channel Comparable Net Sales financial

"Omni-channel Comparable Net Sales (1) | (1.2)% | (8.3)% |"

Omni-channel comparable net sales measure the change in a business’s sales from all connected shopping methods (stores, website, mobile app, call centers and third-party partners) on a like-for-like basis, excluding effects from newly opened or closed locations, major acquisitions, and currency swings. For investors, it shows the true underlying demand and how well the company’s integrated sales strategy is working, similar to comparing how much a bakery sold to regular customers across its shop and online before it opened new branches.

gross margin financial

"Gross margin decreased 240 basis points to 56.1% of net sales"

Gross margin is the difference between how much money a company makes from selling its products and how much it costs to produce them, expressed as a percentage of sales. It shows how efficiently a company is turning sales into profit before other expenses like marketing or salaries. Higher gross margin means the company keeps more money from each sale, which is a good sign of financial health.

SG&A financial

"SG&A | $75.0 | | $71.7 | | 4.5 % |"

SG&A stands for Selling, General, and Administrative expenses. It includes the costs a company spends on selling products, running the business day-to-day, and managing staff, like advertising, rent, and salaries. These expenses matter because they affect how much profit a company can make from its sales.

basis points financial

"Gross margin decreased 240 basis points to 56.1% of net sales"

Basis points are a way to measure small changes in interest rates or percentages, where one basis point equals 0.01%. For example, if a loan's interest rate increases by 50 basis points, it's gone up by 0.50%. They help people understand tiny differences in rates that can add up over time, making financial comparisons clearer.

non-GAAP financial

"Adjusted EBITDA is defined as a non-GAAP financial measure"

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

restricted stock units financial

"director received two grants of restricted stock units (RSUs)"

Restricted stock units are a type of company reward where employees are promised shares of stock, but they only fully own these shares after meeting certain conditions, like staying with the company for a set time. They matter because they can become valuable assets and are often used to motivate employees to help the company succeed.

AI-generated analysis. Not financial advice.

Q3 FY26 Net Sales Increased 0.2% to $150.2 Million vs. Q3 FY25

STAMFORD, Conn., Dec. 11, 2025 (GLOBE NEWSWIRE) -- The Lovesac Company (Nasdaq: LOVE) (“Lovesac” or the “Company”), the Designed for Life home and technology brand best known for its Sactionals, The World's Most Adaptable Couch, today announced financial results for the third quarter of fiscal 2026, which ended November 2, 2025.

Shawn Nelson, Chief Executive Officer, stated, “Our focus on secular growth initiatives such as new products and the beginnings of a major evolution in our marketing, enabled slight year-over-year growth in net sales in the third quarter, reflecting market share gains as compared to our category. As we transitioned into our fiscal fourth quarter, we adjusted our marketing strategies and have seen solid growth quarter-to-date, inclusive of the Black Friday and Cyber Monday holiday events. Lovesac is inventing and investing steadily, even through these tough times for our category, while balancing cash flow generation and profitability. Our tall ambitions begin with reaching our goal of three million Lovesac households by 2030: Households that will have ever-more Designed For Life products across ever-more rooms of the house. We are totally focused and committed to this goal that we believe can produce meaningful growth over the next few years—regardless of what happens in the macro environment.”

Key Measures for the Third Quarter of Fiscal 2026 Ending November 2, 2025:
(Dollars in millions, except per share amounts.   Dollar and percentage changes may not recalculate due to rounding.)

	Thirteen weeks ended								Thirty-nine weeks ended
	November 2, 2025			November 3, 2024			% Inc (Dec)		November 2, 2025			November 3, 2024			% Inc (Dec)
Net sales
Showrooms	$102.7			$91.0			12.8%		$308.2			$271.4			13.6%
Internet	$37.3			$44.9			(16.9%)		$113.1			$125.8			(10.1%)
Other	$10.2			$14.0			(27.3%)		$27.7			$41.9			(33.9%)
Total net sales	$150.2			$149.9			0.2%		$449.1			$439.1			2.3%
Gross profit	$84.2			$87.6			(3.9%)		$249.2			$252.1			(1.1%)
Gross margin		56.1%			58.5%		(240) bps			55.5%			57.4%		(190) bps
Total operating expenses	$100.0			$95.4			4.9%		$288.8			$286.0			1.0%
SG&A	$75.0			$71.7			4.5%		$214.2			$213.8			0.2%
SG&A as a % of Net Sales		49.9%			47.9%		200 bps			47.7%			48.7%		(100) bps
Advertising and marketing	$21.1			$19.9			5.7%		$63.2			$61.3			3.1%
Advertising & marketing as a % of Net Sales		14.0%			13.3%		70 bps			14.1%			13.9%		20 bps
Net loss	$(10.6)			$(4.9)			(114.0%)		$(28.0)			$(23.8)			(18.1%)
Basic net loss per common share	$(0.72)			$(0.32)			(125.0%)		$(1.91)			$(1.53)			(24.8%)
Diluted net loss per common share	$(0.72)			$(0.32)			(125.0%)		$(1.91)			$(1.53)			(24.8%)
Adjusted EBITDA1	$(6.0)			$2.7			(322.9%)		$(13.6)			$(6.1)			(123.1%)
Net cash used in operating activities	$(4.9)			$(4.2)			(15.8%)		$(34.1)			$(5.0)			(575.6%)

¹ Adjusted EBITDA is a non-GAAP measure. See “Non-GAAP Information” and “Reconciliation of Non-GAAP Financial Measures” included in this press release.

Percent increase (decrease) except showroom count
	Thirteen weeks ended		Thirty-nine weeks ended
	November 2, 2025	November 3, 2024	November 2, 2025	November 3, 2024
Omni-channel Comparable Net Sales(1)	(1.2)%	(8.3)%	0.4%	(9.1)%
Internet Sales	(16.9)%	12.1%	(10.1)%	3.4%
Ending Showroom Count	275	258	275	258

¹ Omni-channel Comparable Net Sales includes sales at all retail locations and online, open greater than 12 months (including remodels and relocations) and excludes closed showrooms.

Highlights for the Quarter Ended November 2, 2025:

• Net sales increased $0.3 million, or 0.2%, in the third quarter of fiscal 2026 compared to the prior year period primarily driven by the net addition of 17 new showrooms, partially offset by a decrease of 1.2% in omni-channel comparable net sales. During the third quarter of fiscal 2026, we opened 5 additional showrooms and did not close any showrooms.
  
  
• Gross profit decreased $3.4 million, or 3.9% in the third quarter of fiscal 2026 compared to the prior year period. Gross margin decreased 240 basis points to 56.1% of net sales in the third quarter of fiscal 2026 from 58.5% of net sales in the prior year period primarily driven by increases of 320 basis points in inbound transportation and tariff costs and 20 basis points in outbound transportation and warehousing costs, partially offset by an increase of 100 basis points in product margin driven by cost reduction initiatives from our vendors in response to changes in the tariff environment.
  
  
• SG&A expense increased $3.2 million, or 4.5%, in the third quarter of fiscal 2026 compared to the prior year period primarily due to increases in payroll, including an out-of-period expense pertaining to prior periods employee benefits, licenses and registrations, rent, and other overhead costs, partially offset by decreases in legal and professional fees, and equity-based compensation.
  
• Advertising and marketing expense increased $1.1 million, or 5.7% in the third quarter of fiscal 2026 compared to the prior year period, primarily driven by costs associated with the launch of a new product marketing campaign.
• Operating loss was $15.8 million in the third quarter of fiscal 2026 compared to $7.7 million in the prior year period. Operating margin was (10.5)% of net sales in the third quarter of fiscal 2026 compared to (5.1)% of net sales in the prior year period.
  
  
• Net loss was $10.6 million in the third quarter of fiscal 2026 or $(0.72) net loss per common share compared to $4.9 million or $(0.32) net loss per common share in the prior year period. During the third quarter of fiscal 2026, the Company recorded an income tax benefit of $5.0 million, compared to $2.1 million in the prior year period. The change in benefit was primarily driven by a higher net loss before taxes.
  

Highlights for the Year-to-date Period Ended November 2, 2025:

• Net sales increased $9.9 million, or 2.3%, in the year-to-date period ended November 2, 2025 compared to the prior year period primarily driven by an increase of 0.4% in omni-channel comparable net sales and the net addition of 17 new showrooms compared to the prior year period.
  
  
• Gross profit decreased $2.8 million, or 1.1%, in the year-to-date period ended November 2, 2025 compared to the prior year period. Gross margin decreased 190 basis points to 55.5% of net sales in the year-to-date period ended November 2, 2025 from 57.4% of net sales in the prior year period primarily driven by increases of 110 basis points in inbound transportation and tariff costs and 10 basis points in outbound transportation and warehousing costs, and a decrease of 70 basis points in product margin driven by higher promotional discounting.
  
  
• SG&A expense increased $0.4 million, or 0.2%, in the year-to-date period ended November 2, 2025 compared to the prior year period primarily due to increases in payroll, including an out-of-period expense pertaining to prior periods employee benefits, rent, equity-based compensation, and impairment charges related to the Best Buy partnership discontinuation, partially offset by decreases in legal and professional fees, credit card fees, and other overhead costs.
  
  
• Advertising and marketing expense increased $1.9 million, or 3.1% in the year-to-date period ended November 2, 2025 compared to the prior year period primarily driven by costs associated with the launch of a new product marketing campaign.
  
  
• Operating loss was $39.6 million in the year-to-date period ended November 2, 2025 compared to $34.0 million in the prior year period. Operating margin was (8.8)% of net sales in the year-to-date period ended November 2, 2025 compared to (7.7)% of net sales in the prior year period.
  
  
• Net loss was $28.0 million in the year-to-date period ended November 2, 2025 or $(1.91) net loss per diluted share compared to $23.8 million or $(1.53) net loss per diluted share in the prior year period. During the year-to-date period ended November 2, 2025, the Company recorded an income tax benefit of $10.9 million, compared to $8.1 million for the prior year period. The change in benefit was primarily driven by a higher net loss before taxes.
  

Other Financial Highlights as of November 2, 2025:

• The cash and cash equivalents balance as of November 2, 2025 was $23.7 million as compared to $61.7 million as of November 3, 2024. There was no balance on the Company’s line of credit as of November 2, 2025 and November 3, 2024. The Company’s availability under the line of credit was $36.0 million as of November 2, 2025 and November 3, 2024.
  
  
• Total merchandise inventory was $129.7 million as of November 2, 2025 as compared to $113.4 million as of November 3, 2024 primarily related to an increase in freight capitalization of $10.7 million coupled with a planned stock inventory increase of $5.5 million.
  

Outlook:

The Company provides guidance of select information related to the Company’s financial and operating performance, and such measures may differ from year to year. The projections are as of this date and the Company assumes no obligation to update or supplement this information.

The Company currently expects the following for the full year of fiscal 2026:

• Net sales in the range of $685 million to $705 million.
• Adjusted EBITDA¹ in the range of $37 million to $43 million.
• Net income in the range of $2 million to $8 million.
• Diluted income per common share in the range of $0.15 to $0.49 on approximately 16.2 million estimated diluted weighted average shares outstanding.

The Company currently expects the following for the fourth quarter of fiscal 2026:

• Net sales in the range of $236 million to $256 million.
• Adjusted EBITDA¹ in the range of $51 million to $56 million.
• Net income in the range of $30 million to $36 million.
• Diluted income per common share in the range of $1.88 to $2.22 on approximately 16.2 million estimated diluted weighted average shares outstanding.

¹ Adjusted EBITDA is a non-GAAP measure. See “Non-GAAP Information” and “Reconciliation of Non-GAAP Financial Measures” included in this press release.

Conference Call Information:

A conference call to discuss the financial results for the third quarter ended November 2, 2025 is scheduled for today, December 11, 2025, at 8:30 a.m. Eastern Time. Investors and analysts interested in participating in the call are invited to dial (877) 407-3982 (international callers please dial (201) 493-6780) approximately 10 minutes prior to the start of the call. A live audio webcast of the conference call will be available online at investor.lovesac.com.

A recorded replay of the conference call will be available within two hours of the conclusion of the call and can be accessed online at investor.lovesac.com for 90 days.

About The Lovesac Company:

Based in Stamford, Connecticut, The Lovesac Company (NASDAQ: LOVE) is a technology driven company that designs, manufactures and sells unique, high quality furniture derived through its proprietary Designed for Life approach which results in products that are built to last a lifetime and designed to evolve as customers’ lives do. The current product offering is comprised of modular couches called Sactionals, the Sactionals Reclining seat, premium foam beanbag chairs called Sacs, the PillowSac™ Chair, an immersive surround sound home theater system called StealthTech, and an innovative sofa seating solution called Snugg™. As a recipient of Repreve’s 7th Annual Champions of Sustainability Award, responsible production and innovation are at the center of the brand’s design philosophy with products protected by a robust portfolio of utility patents. Products are marketed and sold primarily online directly at www.lovesac.com, supported by a physical retail presence in the form of Lovesac branded showrooms, as well as through shop-in-shops and pop-up-shops with third party retailers. LOVESAC, DESIGNED FOR LIFE, SACTIONALS, SAC, STEALTHTECH, and THE WORLD'S MOST ADAPTABLE COUCH are trademarks of The Lovesac Company and are Registered in the U.S. Patent and Trademark Office.

Non-GAAP Information:

Adjusted EBITDA is defined as a non-GAAP financial measure by the Securities and Exchange Commission (the “SEC”) that is a supplemental measure of financial performance not required by, or presented in accordance with, GAAP. We define “Adjusted EBITDA” as earnings before interest, taxes, depreciation and amortization, adjusted for the impact of certain non-cash and other items that we do not consider in our evaluation of ongoing operating performance. These items include management fees, equity-based compensation expense, write-offs of property and equipment, deferred rent, financing expenses and certain other charges and gains that we do not believe reflect our underlying business performance. We have reconciled this non-GAAP financial measure with the most directly comparable GAAP financial measure within the schedules attached hereto. Statements regarding our expectations as to fiscal 2026 Adjusted EBITDA do not include certain charges and costs. These items include equity-based compensation expense and certain other charges and gains that we do not believe reflect our underlying business performance. We are not able to provide a reconciliation of our non-GAAP financial guidance to the corresponding GAAP measures without unreasonable effort because of the uncertainty and variability of the nature and amount of these future charges and costs. This is due to the inherent difficulty of forecasting the timing of certain events that have not yet occurred and are out of the Company’s control.

We believe that these non-GAAP financial measures not only provide its management with comparable financial data for internal financial analysis but also provide meaningful supplemental information to investors. Specifically, these non-GAAP financial measures allow investors to better understand the performance of our business, facilitate a more meaningful comparison of our actual results on a period-over-period basis and provide for a more complete understanding of factors and trends affecting our business. We have provided this information as a means to evaluate the results of our ongoing operations alongside GAAP measures such as gross profit, operating income (loss) and net income (loss). Other companies in our industry may calculate these items differently than we do. These non-GAAP measures should not be considered as a substitute for the most directly comparable financial measures prepared in accordance with GAAP, such as net income (loss) or net income (loss) per share as a measure of financial performance, cash flows from operating activities as a measure of liquidity, or any other performance measure derived in accordance with GAAP. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.

Cautionary Statement Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other legal authority. Forward-looking statements can be identified by words such as “may,” “continue(s),” “believe,” “anticipate,” “could,” “should,” “intend,” “plan,” “will,” “aim(s),” “can,” “would,” “expect(s),” “expectation(s),” “estimate(s),” “project(s),” “projections,” “forecast(s)”, “positioned,” “approximately,” “potential,” “goal,” “pro forma,” “strategy,” “outlook” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. All statements, other than statements of historical facts, included in this press release under the heading “Outlook” and all statements regarding strategy, future operations and launch of new products, the pace and success of new products, future financial position or projections, future revenue, projected expenses, sustainability goals, prospects, plans and objectives of management are forward-looking statements. These statements are based on management’s current expectations, beliefs and assumptions concerning the future of our business, anticipated events and trends, the economy and other future conditions. We may not actually achieve the plans, carry out the intentions or meet the expectations disclosed in the forward-looking statements and you should not rely on these forward-looking statements. Actual results and performance could differ materially from those projected in the forward-looking statements as a result of many factors. Among the key factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements include: business disruptions or other consequences of economic instability, recession, political instability, civil unrest, armed hostilities and global conflicts, natural and man-made disasters, pandemics or other public health crises, or other catastrophic events; the impact of changes or declines in consumer spending and increases in interest rates and inflation on our business, sales, results of operations and financial condition; cybersecurity and vulnerability to electronic break-ins and other similar disruptions; active pending or threatened litigation; our ability to manage and sustain our growth and profitability effectively, including in our ecommerce business, forecast our operating results, and manage inventory levels; our cash flows, changes in the market price of our common stock, global economic and market conditions and other considerations that could impact the specific timing, price and size of repurchases under our stock repurchase program or our ability to fund any stock repurchases; our ability to improve our products and develop and launch new products; our ability to successfully open and operate new showrooms; our ability to advance, implement or achieve the goals set forth in our ESG Report; our ability to realize the expected benefits of investments in our supply chain and infrastructure; disruption in our supply chain and dependence on foreign manufacturing and imports for our products; execution of our share repurchase program and its expected benefits for enhancing long-term shareholder value; our ability to acquire new customers and engage existing customers; reputational risk associated with increased use of social media; our ability to attract, develop and retain highly skilled associates and employees; system interruption or failures in our technology infrastructure needed to service our customers, process transactions and fulfill orders; any inability to implement and maintain effective internal control over financial reporting; unauthorized disclosure of sensitive or confidential information through breach of our computer system; the ability of third-party providers to continue uninterrupted service; the impact of changes in diplomatic and trade relations, as well as tariffs and the countermeasures and tariff mitigation initiatives; the regulatory environment in which we operate; our ability to maintain, grow and enforce our brand and intellectual property rights and avoid infringement or violation of the intellectual property rights of others; and our ability to compete and succeed in a highly competitive and evolving industry, as well as those risks and uncertainties disclosed under the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our most recent Form 10-K and in our Form 10-Qs filed with the Securities and Exchange Commission, and similar disclosures in subsequent reports filed with the SEC, which are available on our investor relations website at investor.lovesac.com and on the SEC website at www.sec.gov. Any forward-looking statement made by us in this press release speaks only as of the date on which we make it. We disclaim any intent or obligation to update these forward-looking statements to reflect events or circumstances that exist after the date on which they were made.

Investor Relations Contact:
Caitlin Churchill, ICR
(203) 682-8200
InvestorRelations@lovesac.com 

THE LOVESAC COMPANY
CONDENSED BALANCE SHEETS
(unaudited)
(amounts in thousands, except share and per share amounts)		November 2, 2025				February 2, 2025
Assets
Current Assets
Cash and cash equivalents		$	23,722			$	83,734
Trade accounts receivable, net			16,960				16,781
Merchandise inventories, net			129,681				124,333
Prepaid expenses			13,098				14,807
Other current assets			2,525				6,942
Total Current Assets			185,986				246,597
Property and equipment, net			86,726				77,990
Operating lease right-of-use assets			163,081				157,750
Goodwill			144				144
Intangible assets, net			2,104				1,586
Deferred tax asset			26,368				15,277
Other assets			31,105				32,906
Total Assets		$	495,514			$	532,250
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable		$	45,548			$	51,814
Accrued expenses			41,402				51,986
Payroll payable			14,009				9,501
Customer deposits			8,727				11,250
Current operating lease liabilities			22,730				22,662
Sales taxes payable			4,582				7,897
Total Current Liabilities			136,998				155,110
Operating lease liabilities, long-term			168,785				160,361
Income tax payable, long-term			424				424
Line of credit			—				—
Total Liabilities			306,207				315,895
Commitments and Contingencies
Stockholders’ Equity
Preferred Stock $0.00001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of November 2, 2025 and February 2, 2025.			—				—
Common Stock $0.00001 par value, 40,000,000 shares authorized, 14,615,785 shares issued and outstanding as of November 2, 2025 and 14,786,934 shares issued and outstanding as of February 2, 2025.			—				—
Additional paid-in capital			197,549				190,510
Accumulated (deficit) earnings			(8,242	)			25,845
Stockholders' Equity			189,307				216,355
Total Liabilities and Stockholders' Equity		$	495,514			$	532,250

THE LOVESAC COMPANY
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
		Thirteen weeks ended								Thirty-nine weeks ended
(amounts in thousands, except per share data and share amounts)		November 2, 2025				November 3, 2024				November 2, 2025				November 3, 2024
Net sales		$	150,166			$	149,905			$	449,069			$	439,138
Cost of merchandise sold			65,929				62,266				199,854				187,085
Gross profit			84,237				87,639				249,215				252,053
Operating expenses:
Selling, general and administrative expenses			74,964				71,749				214,195				213,826
Advertising and marketing			21,075				19,947				63,150				61,253
Depreciation and amortization			4,002				3,666				11,451				10,924
Total operating expenses			100,041				95,362				288,796				286,003
Operating loss			(15,804	)			(7,723	)			(39,581	)			(33,950	)
Interest and other income, net			206				701				631				2,139
Net loss before taxes			(15,598	)			(7,022	)			(38,950	)			(31,811	)
Income tax benefit			5,047				2,092				10,909				8,060
Net loss		$	(10,551	)		$	(4,930	)		$	(28,041	)		$	(23,751	)
Net loss per common share:
Basic		$	(0.72	)		$	(0.32	)		$	(1.91	)		$	(1.53	)
Diluted		$	(0.72	)		$	(0.32	)		$	(1.91	)		$	(1.53	)
Weighted average shares outstanding:
Basic			14,655,495				15,574,293				14,692,182				15,567,442
Diluted			14,655,495				15,574,293				14,692,182				15,567,442

THE LOVESAC COMPANY
CONDENSED STATEMENT OF CASH FLOWS
(unaudited)
		Thirty-nine weeks ended
(amounts in thousands)		November 2, 2025				November 3, 2024
Cash Flows from Operating Activities
Net loss		$	(28,041	)		$	(23,751	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization of property and equipment			11,223				10,610
Amortization of other intangible assets			228				314
Amortization of deferred financing fees			55				112
Net loss on disposal of property and equipment			279				74
Impairment of long-lived assets			1,541				—
Equity based compensation			8,201				6,687
Non-cash lease expense			20,212				18,741
Deferred income taxes			(11,091	)			(8,316	)
Change in operating assets and liabilities:
Trade accounts receivable			(179	)			(2,652	)
Merchandise inventories			(5,348	)			(15,005	)
Prepaid expenses and other current assets			6,083				(2,983	)
Other assets			1,801				(5,389	)
Accounts payable			(7,695	)			19,332
Accrued expenses and other payables			(9,964	)			2,688
Operating lease liabilities			(18,875	)			(13,888	)
Customer deposits			(2,523	)			8,380
Net cash used in operating activities			(34,093	)			(5,046	)
Cash Flows from Investing Activities
Purchase of property and equipment			(18,211	)			(15,739	)
Payments for patents and trademarks			(534	)			(339	)
Net cash used in investing activities			(18,745	)			(16,078	)
Cash Flows from Financing Activities
Taxes paid for net share settlement of equity awards			(1,162	)			(487	)
Repurchases of common stock			(6,000	)			(3,431	)
Payment of deferred financing costs			(12	)			(303	)
Net cash used in financing activities			(7,174	)			(4,221	)
Net change in cash and cash equivalents			(60,012	)			(25,345	)
Cash and cash equivalents - Beginning			83,734				87,036
Cash and cash equivalents - Ending		$	23,722			$	61,691
Supplemental Cash Flow Data:
Cash paid for taxes		$	9,152			$	8,383
Cash paid for interest		$	91			$	92
Non-cash investing and financing activities:
Asset acquisitions not yet paid for at period end		$	1,956			$	1,344
Leasehold improvements acquired through lease incentive		$	1,824			$	—
Excise tax on share repurchases, accrued but not paid		$	46			$	18

THE LOVESAC COMPANY
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(unaudited)
		Thirteen weeks ended								Thirty-nine weeks ended
(amounts in thousands)		November 2, 2025				November 3, 2024				November 2, 2025				November 3, 2024
Net loss		$	(10,551	)		$	(4,930	)		$	(28,041	)		$	(23,751	)
Interest income, net			(205	)			(701	)			(632	)			(2,139	)
Income tax benefit			(5,047	)			(2,092	)			(10,909	)			(8,060	)
Depreciation and amortization			4,002				3,666				11,451				10,924
EBITDA			(11,801	)			(4,057	)			(28,131	)			(23,026	)
Equity-based compensation (a)			2,436				2,785				8,337				6,748
Loss on disposal of assets (b)			2				12				36				74
Other non-recurring expenses (c)			3,397				3,937				6,182				10,119
Adjusted EBITDA		$	(5,966	)		$	2,677			$	(13,576	)		$	(6,085	)

(a) Represents expenses, such as compensation expense and employer taxes related to RSU equity vesting and exercises associated with stock options and restricted stock units granted to our associates and board of directors. Employer taxes are included as part of selling, general and administrative expenses on the Statements of Operations.

(b) Represents loss on disposal of property and equipment.

(c) Other non-recurring expenses in the thirteen weeks ended November 2, 2025 represents severance, professional fees related to the restatement of previously issued financial statements, an out-of-period expense pertaining to prior periods employee benefits, and expenses associated with other legal matters, partially offset by benefits related to insurance proceeds. Other non-recurring expenses in the thirty-nine weeks ended November 2, 2025 also represents impairment charges and other costs related to the Best Buy partnership discontinuation. Other non-recurring expenses in the thirteen weeks ended November 3, 2024 represents professional fees related to the restatement of previously issued financial statements, infrequent and unusual production costs, and expenses associated with other legal matters. Other non-recurring expenses in the thirty-nine weeks ended November 3, 2024 also includes severance, partially offset by benefits related to insurance proceeds.

FAQ

What were Lovesac (LOVE) Q3 FY26 net sales and comparable sales on November 2, 2025?

Q3 FY26 net sales were $150.2M and omni‑channel comparable net sales declined 1.2%.

How did Lovesac's gross margin and key cost drivers change in Q3 FY26?

Gross margin fell 240 basis points to 56.1%, driven by higher inbound transportation and tariff costs.

What was Lovesac's cash and inventory position as of November 2, 2025 (LOVE)?

Cash and cash equivalents were $23.7M and merchandise inventory was $129.7M.

What guidance did Lovesac provide for full‑year FY26 and Q4 FY26 (LOVE)?

FY26: net sales $685–705M, Adjusted EBITDA $37–43M, net income $2–8M. Q4: net sales $236–256M, Adjusted EBITDA $51–56M, net income $30–36M.

How many Lovesac showrooms were open at the end of Q3 FY26 and how many were added?

Ending showroom count was 275, a net increase of 17 showrooms year‑over‑year.

What was Lovesac's Q3 FY26 net loss and diluted loss per share (LOVE)?

Q3 net loss was $10.6M, or $(0.72) per diluted share.