Purple Innovation Reports Fourth Quarter and Full Year 2025 Results

Rhea-AI Summary

Purple Innovation (NASDAQ: PRPL) reported fourth-quarter 2025 revenue of $140.7M, up ~9.1%, and GAAP net loss of $3.2M. Adjusted EBITDA was $8.8M in Q4 and $1.9M for full-year 2025. Full-year revenue was $468.7M, down 3.9%.

Gross margin improved to 40.2% for 2025 and 41.9% in Q4. Cash totaled $24.3M at year-end. 2026 guidance: revenue $500–$520M and adjusted EBITDA $20–$30M; Q1 2026 revenue guide of $100–$105M with adjusted EBITDA of $(7)–$(4)M.

Positive

• Q4 revenue +9.1% to $140.7M
• Q4 adjusted EBITDA of $8.8M
• Full-year adjusted EBITDA positive at $1.9M
• Full-year gross margin improved to 40.2%
• Q4 gross margin of 41.9%

Negative

• GAAP net loss of $3.2M in Q4
• Full-year net loss of $51.4M
• Cash declined to $24.3M from $29.0M

Key Figures

Q4 2025 net revenue: $140.7M Q4 2025 gross margin: 41.9% Q4 2025 net loss: $3.2M +5 more

8 metrics

Q4 2025 net revenue $140.7M Fourth quarter 2025 net revenue, up ~9.1% YoY

Q4 2025 gross margin 41.9% Fourth quarter 2025 gross profit as % of revenue

Q4 2025 net loss $3.2M Fourth quarter 2025 GAAP net loss attributable to PRPL

Q4 2025 adjusted EBITDA $8.8M Fourth quarter 2025 adjusted EBITDA

FY 2025 net revenue $468.7M Full year 2025 net revenue, down 3.9% vs 2024

FY 2025 gross margin 40.2% Full year 2025 gross margin, up 310 bps YoY

FY 2025 adjusted EBITDA $1.9M Full year 2025 adjusted EBITDA vs $(20.8)M last year

Cash & equivalents $24.3M Cash and cash equivalents as of December 31, 2025

Market Reality Check

Price: $0.6484 Vol: Volume 407,012 is 1.7x th...

high vol

$0.6484 Last Close

Volume Volume 407,012 is 1.7x the 20-day average of 239,457, showing elevated trading into these results. high

Technical Shares at 0.6484 are trading below the 200-day MA of 0.81 and remain 48.54% under the 52-week high.

Peers on Argus

Sector peers showed mixed moves: IRBT -30.4%, NVFY -4.78%, KEQU -0.41%, while HO...

Sector peers showed mixed moves: IRBT -30.4%, NVFY -4.78%, KEQU -0.41%, while HOFT +6.28% and VIRC +0.48%. With no peers in the momentum scanner and conflicting peer directions, the setup points to company-specific trading around PRPL’s earnings rather than a broad household-furniture move.

Previous Earnings Reports

5 past events · Latest: Nov 04 (Positive)

Same Type Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Nov 04	Q3 2025 earnings	Positive	-11.0%	Profitability turnaround with better margins and lower operating expenses.
Jul 29	Q2 2025 earnings	Neutral	-3.8%	Revenue decline but adjusted EBITDA improvement and guidance reaffirmed.
May 06	Q1 2025 earnings	Positive	+10.2%	Margin expansion, smaller net loss and major Mattress Firm expansion.
Mar 13	FY 2024 earnings	Positive	+35.6%	Return to positive adjusted EBITDA and detailed 2025 outlook.
Nov 04	Q3 2024 earnings	Negative	-12.0%	Revenue decline and sizable net loss despite improving adjusted EBITDA.

Pattern Detected

Earnings releases often move PRPL meaningfully, with most past reactions aligning with the news tone but one notable negative divergence on an otherwise improving quarter.

Recent Company History

Recent earnings for Purple Innovation show a multi-quarter push toward improved profitability. Q3 2024 featured revenue declines but narrowing adjusted EBITDA losses amid restructuring. By Q4 2024, the company returned to positive adjusted EBITDA and issued 2025 guidance. Throughout 2025, Q1 and Q2 maintained guidance despite revenue pressure, while Q3 2025 highlighted a profitability turnaround with better gross margins and lower operating expenses. Today’s Q4 and full-year 2025 results extend that narrative with positive adjusted EBITDA for the year and gross margin above 40%.

Historical Comparison

+3.8% avg move · In the past five earnings releases, PRPL saw an average move of 3.8%, with most reactions aligning t...

earnings

+3.8%

Average Historical Move earnings

In the past five earnings releases, PRPL saw an average move of 3.8%, with most reactions aligning to improving but volatile profitability trends.

Across these earnings, Purple moved from revenue declines with large losses toward improved gross margins, lower operating expenses, and returning to positive adjusted EBITDA, while repeatedly reaffirming or maintaining full‑year guidance.

Market Pulse Summary

This announcement highlights Purple Innovation’s transition to positive full‑year adjusted EBITDA of...

Analysis

This announcement highlights Purple Innovation’s transition to positive full‑year adjusted EBITDA of $1.9M and a gross margin above 40%, even as 2025 revenue declined to $468.7M. Q4 revenue growth of 9.1% and adjusted EBITDA of $8.8M underscore momentum in wholesale channels and cost controls. Historically, earnings have triggered notable stock moves, so investors may watch how 2026 guidance of $500–$520M revenue and $20–$30M adjusted EBITDA compares to future quarters and macro demand trends.

Key Terms

gaap, adjusted ebitda, gross margin, basis points

4 terms

gaap financial

"GAAP Net Loss of $3.2 Million in Fourth Quarter"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

adjusted ebitda financial

"Delivers $8.8 Million in Adjusted EBITDA in Fourth Quarter"

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.

gross margin financial

"Full Year Adjusted EBITDA Positive; Gross Margin Exceeds 40% Target"

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.

basis points financial

"Gross margin was up against a period when it rose 970 basis points"

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.

AI-generated analysis. Not financial advice.

Revenue Increases 9% in Fourth Quarter
GAAP Net Loss of $3.2 Million in Fourth Quarter
Delivers $8.8 Million in Adjusted EBITDA in Fourth Quarter
Full Year Adjusted EBITDA Positive; Gross Margin Exceeds 40% Target

LEHI, Utah, March 31, 2026 /PRNewswire/ -- Purple Innovation, Inc. (NASDAQ: PRPL) ("Purple"), a comfort innovation company whose mattresses promise to give you "less pain, better sleep," today announced results for the fourth quarter and full year ended December 31, 2025.

"2025 marked an important inflection point for Purple," said Rob DeMartini, CEO of Purple Innovation. "In the fourth quarter, we delivered revenue growth of approximately 9%, delivered gross profit expansion, and generated $8.8 million in adjusted EBITDA. We also finished the year profitable on an adjusted EBITDA basis, a significant milestone that reflects the structural improvements we have made across the business."

DeMartini continued, "Over the past year, we strengthened our foundation through disciplined cost actions and manufacturing consolidation, while reinforcing our premium positioning. Rejuvenate 2.0 continued to outperform, our expanded Mattress Firm partnership and Costco programs drove meaningful wholesale growth, and our showroom fleet delivered improved profitability. As we enter 2026, we are operating from a stronger margin profile and a more efficient cost structure, supported by what we believe is a clear and disciplined strategy to scale profitably."

Fourth Quarter 2025 Financial Results
Fourth quarter 2025 net revenue was $140.7 million, representing growth of approximately 9.1% compared to the fourth quarter of 2024. Growth was driven primarily by the wholesale channel, reflecting a full quarter of expanded Mattress Firm placements and continued momentum with Costco, partially offset by a decline in e-commerce.

Gross profit for the fourth quarter increased to $59.0 million or 41.9% of net revenue, compared to $55.3 million or 42.9% in the prior-year period. Gross margin was up against a period when it rose 970 basis points, driven by sourcing initiatives and the profitable liquidation of inventories.  On a two-year basis, gross margin rose 870 basis points, reflecting direct material savings, plant efficiencies, restructuring benefits, and volume leverage.

Fourth quarter operating expenses were $61.2 million, down 2.9% from $63.0 million in the prior year quarter. The improvement was primarily driven by ongoing benefits from restructuring and cost-saving initiatives, partially offset by strategic alternatives costs. 

Net loss attributable to Purple Innovation, Inc. for the fourth quarter was $3.2 million, an improvement from $(8.5) in the prior year.

Adjusted EBITDA for the fourth quarter was $8.8 million, an improvement from $2.9 million last year, driven primarily by revenue growth and disciplined cost management.

Full Year 2025 Financial Results
Full year 2025 net revenue was $468.7 million, a decline of 3.9% compared to the full year 2024. The reduction was driven primarily by ecommerce headwinds, partially offset by expanded partnerships in the wholesale channel.

Gross profit for the full year increased to $188.6 million, compared to $181.1 million in the prior-year period. Gross margin was 40.2%, up 310 basis points from last year, reflecting the continued impact of our restructuring initiatives, sourcing savings, and manufacturing efficiencies.

Full year operating expenses were $231.6 million, down 15.3% from $273.3 million in the prior year, driven by restructuring actions and productivity initiatives. 

Net loss attributable to Purple Innovation, Inc. for the full year was $(51.4) million, an improvement from $(97.9) in the prior year.

Adjusted EBITDA for the full year was $1.9 million, a significant improvement from $(20.8) million last year.

Balance Sheet
As of December 31, 2025, the Company had cash and cash equivalents of $24.3 million compared to $29.0 million as of December 31, 2024.

Net inventories as of December 31, 2025, totaled $59.7 million, down 9.2% compared to September 30, 2025, and an increase of 5.0% compared to December 31, 2024.

2026 Outlook
For 2026, the Company currently expects full year revenue to be in the range of $500 to $520 million and adjusted EBITDA in the range of $20 to $30 million.

For the first quarter, the Company anticipates total revenue to be in the range of $100 to $105 million and adjusted EBITDA to be approximately $(7) to $(4) million.

Conference Call and Webcast Information
Purple Innovation, Inc. will host a live conference call to discuss financial results today, March 25, 2026, at 8:30 a.m. Eastern Time.  To access the call dial 800-715-9871 (domestic) or 646-307-1963 (international). The call is also being webcast and can be accessed on the investor relations section of the Company's website, investors.purple.com. After the conference call, a webcast replay will remain available on the investor relations section of the Company's website for 30 days.

About Purple
Purple exists to help people get the best sleep of their lives — by reducing pain, deepening sleep, and unlocking the potential for brighter dawns and better days. At the center of that mission is our signature innovation, the GelFlex Grid®. Originally developed in medical settings to support the body in its most vulnerable moments, the GelFlex Grid delivers a one-of-a-kind combination of pressure relief, alignment, and temperature balance that helps people fall asleep easier, stay asleep longer, and wake up with less pain.

That same comfort technology extends beyond mattresses into pillows, bedding, and cushions designed to make everyday life feel a little lighter and a lot more comfortable. Because when pain eases and sleep improves, everything else gets better too — your energy, your outlook, and your ability to show up for the moments that matter.

Less pain. Better sleep.

Learn more at www.purple.com

Forward Looking Statements
Certain statements made in this release that are not historical facts are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Statements based on historical data are not intended and should not be understood to indicate the Company's expectations regarding future events. Forward-looking statements provide current expectations or forecasts of future events or determinations. These statements include, but are not limited to, statements regarding our innovation pipeline, the timing of new product collection launches, our ability to improve profitability and optimize our business, the expansion of and benefits to us from our commercial relationship with Mattress Firm, the impact of other commercial relationships, including those with Walmart, Costco, and other traditional and non-traditional partners, our ability to drive profitable growth and create shareholder value, and our outlook for revenue and adjusted EBITDA for the first quarter and full year 2026.  These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Factors that could influence the realization of forward-looking statements include, among others: changes in economic, financial and end-market conditions in the markets in which we operate; fluctuations in raw material prices and cost of labor; the financial condition of our customers and suppliers; competitive pressures, including the need for technology improvement, successful new product development and introduction; changes in consumer demand, including pullbacks in consumer spending; disruptions to our manufacturing processes; and the risk factors outlined in the "Risk Factors" section of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 25, 2026, and in our other filings made with the SEC. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures
EBITDA, adjusted EBITDA, adjusted gross profit, adjusted operating expenses, adjusted net income, and adjusted net income per diluted share are non-GAAP financial measures that remove the impact of certain non-cash and non-recurring costs. Management believes that the use of such non-GAAP financial measures provides investors with additional useful information with respect to the impact of various adjustments, which we view as a better measure of our operating performance. Refer to the attached table for the reconciliation of such non-GAAP financial measures to the most comparable GAAP financial measure.

With respect to the Company's Adjusted EBITDA outlook for the first quarter and full year 2026, a quantitative reconciliation to the corresponding GAAP information cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted, including but not limited to warrant liabilities and stock based compensation. For the same reasons, the Company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results.

Investor Contact:
Stacy Turnof, Edelman Smithfield
stacy.turnof@edelmansmithfield.com
917-362-2581

PURPLE INNOVATION, INC. Consolidated Balance Sheets (in thousands, except for par value)
		December 31,
		2025				2024
Assets
Current assets:
Cash and cash equivalents		$	24,345			$	29,011
Accounts receivable, net			41,272				33,057
Inventories			59,725				56,863
Prepaid expenses			5,487				6,023
Other current assets			5,891				1,414
Total current assets			136,720				126,368
Property and equipment, net			77,961				93,874
Operating lease right-of-use assets			67,271				75,516
Intangible assets, net			6,346				8,890
Other long-term assets			7,961				3,197
Total assets		$	296,259			$	307,845
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	40,312			$	40,639
Accrued compensation			7,673				9,415
Customer prepayments			5,276				6,411
Accrued rebates and allowances			13,416				10,013
Accrued warranty liabilities – current portion			7,141				6,114
Operating lease obligations – current portion			17,366				15,661
Other current liabilities			10,339				12,750
Total current liabilities			101,523				101,003
Related party debt			111,305				55,394
Accrued warranty liabilities, net of current portion			19,570				26,091
Operating lease obligations, net of current portion			75,616				87,072
Warrant liabilities			16,150				16,067
Other long-term liabilities			1,764				2,009
Total liabilities			325,928				287,636
Commitments and contingencies (Note 13)
Stockholders' equity (deficit):
Class A common stock; $0.0001 par value, 210,000 shares authorized; 108,246 and           107,545 issued and outstanding at December 31, 2025 and 2024, respectively			11				11
Class B common stock; $0.0001 par value, 90,000 shares authorized; 163 and 165      issued and outstanding at December 31, 2025 and 2024, respectively			—				—
Additional paid-in capital			595,582				594,053
Accumulated deficit			(625,280)				(573,866)
Total stockholders' equity (deficit) attributable to Purple Innovation, Inc.			(29,687)				20,198
Noncontrolling interest			18				11
Total stockholders' equity (deficit)			(29,669)				20,209
Total liabilities and stockholders' equity (deficit)		$	296,259			$	307,845

 

PURPLE INNOVATION, INC. Consolidated Statements of Operations (in thousands, except per share amounts)
		Three Months Ended December 31,								Year Ended December 31,
		2025				2024				2025				2024
Revenues, net		$	140,688			$	128,975			$	468,725			$	487,877
Cost of revenues:
Cost of revenues			81,709				71,113				279,171				291,303
Cost of revenues - restructuring related charges			—				2,583				995				15,442
Total cost of revenues			81,709				73,696				280,166				306,745
Gross profit			58,979				55,279				188,559				181,132
Operating expenses:
Marketing and sales			39,678				45,485				147,040				171,263
General and administrative			18,879				14,006				63,557				69,117
Research and development			2,607				2,390				9,604				12,962
Restructuring, impairment and other related charges			—				1,092				11,387				19,973
Total operating expenses			61,164				62,973				231,588				273,315
Operating loss			(2,185)				(7,694)				(43,029)				(92,183)
Other income (expense):
Interest expense			(8,342)				(4,481)				(28,766)				(17,510)
Other income, net			1,477				(64)				3,289				11,548
Loss on extinguishment of debt			—				—				—				(3,394)
Change in fair value – warrant liabilities			5,883				3,615				17,202				3,504
Total other income (expense), net			(982)				(930)				(8,275)				(5,852)
Net loss before income taxes			(3,167)				(8,624)				(51,304)				(98,035)
Income tax benefit (expense)			(59)				113				(207)				(63)
Net loss			(3,226)				(8,511)				(51,511)				(98,098)
Net loss attributable to noncontrolling interest			(14)				(32)				(97)				(201)
Net loss attributable to Purple Innovation, Inc.		$	(3,212)			$	(8,479)			$	(51,414)			$	(97,897)
Net loss per share:
Basic		$	(0.03)			$	(0.08)			$	(0.48)			$	(0.91)
Diluted		$	(0.03)			$	(0.08)			$	(0.48)			$	(0.91)
Weighted average common shares outstanding:
Basic			108,246				107,528				108,081				107,139
Diluted			108,409				107,710				108,245				107,324

 

PURPLE INNOVATION, INC. Consolidated Statements of Cash Flows (in thousands)
		Year Ended December 31,
		2025				2024
Cash flows from operating activities:
Net loss		$	(51,511)			$	(98,098)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			24,064				35,355
Non-cash interest			13,416				7,229
Paid-in-kind interest			15,804				9,679
Non-cash restructuring, impairment and other related charges			3,775				20,238
Loss on extinguishment of debt			—				3,394
Loss on disposal of property and equipment			318				770
Change in fair value – warrant liabilities			(17,202)				(3,504)
Stock-based compensation			1,729				2,815
Changes in operating assets and liabilities:
Accounts receivable			(8,215)				4,745
Inventories			(2,862)				5,989
Prepaid expenses and other assets			3,141				2,345
Operating leases, net			(2,917)				(2,412)
Accounts payable			61				(6,376)
Accrued compensation			(1,742)				4,351
Customer prepayments			(1,135)				693
Accrued rebates and allowances			(97)				(3,230)
Accrued warranty liabilities			(5,494)				(3,386)
Other accrued liabilities			(4,963)				1,553
Net cash used in operating activities			(33,830)				(17,850)
Cash flows from investing activities:
Sale of property and equipment			464				—
Purchase of property and equipment			(8,079)				(7,244)
Investment in intangible assets			(664)				(286)
Net cash used in investing activities			(8,279)				(7,530)
Cash flows from financing activities:
Proceeds from related party loan			39,000				61,000
Payments on term loan			—				(25,000)
Payments on revolving line of credit			—				(5,000)
Payments for debt issuance costs			(1,557)				(3,466)
Net cash provided by financing activities			37,443				27,534
Net increase (decrease) in cash and cash equivalents			(4,666)				(2,154)
Cash and cash equivalents, beginning of the year			29,011				26,857
Cash and cash equivalents, end of the period		$	24,345			$	29,011

 

PURPLE INNOVATION, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(In thousands)

Management believes that the use of the following non-GAAP financial measures provides investors with additional useful information with respect to the impact of various adjustments, which we view as a better measure of our operating performance. These non-GAAP financial measures are EBITDA, adjusted EBITDA, adjusted gross profit, adjusted operating expenses, adjusted net loss and adjusted net loss per diluted share. Other companies may calculate these non-GAAP measures differently than we do. These non-GAAP measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for our financial results prepared in accordance with GAAP.

Reconciliation of GAAP Net Income (Loss) to Non-GAAP EBITDA and Adjusted EBITDA

A reconciliation of GAAP net income (loss) to the non-GAAP measures of EBITDA and adjusted EBITDA is provided below. EBITDA represents net income (loss) before interest expense, income tax expense, other income, net, and depreciation and amortization. Adjusted EBITDA represents EBITDA excluding costs incurred due to changes in the fair value of the warrant liability, debt extinguishment, stock-based compensation expense, restructuring related expenses, loss on project write-off, nonrecurring legal fees, strategic alternative costs, executive interim and search costs, severance cost, showroom opening and closing costs and non-operating facility expense. We believe EBITDA and Adjusted EBITDA provide additional useful information with respect to the impact of various adjustments and provide meaningful measures of our operating performance.

		Three Months Ended  December 31,								Year Ended December 31,
		2025				2024				2025				2024
GAAP net loss		$	(3,226)				(8,511)				(51,511)				(98,098)
Interest expense			8,342				4,481				28,766				17,510
Income tax expense			59				113				207				63
Other income, net			(1,477)				64				(3,289)				(11,548)
Depreciation and amortization			4,406				7,907				24,064				35,355
EBITDA			8,104				3,828				(1,763)				(56,718)
Adjustments:
Change in fair value - warrant liability			(5,883)				(3,615)				(17,202)				(3,504)
Loss on extinguishment of debt			—				—				—				3,394
Stock-based compensation expense			464				685				1,729				2,815
Restructuring related charges			—				1,378				6,850				25,047
Loss on project write-off			—				—				—				1,355
Non-recurring legal fees			81				42				1,531				982
Strategic alternative costs			5,317				—				7,275				—
Executive interim and search costs			—				233				—				3,616
Severance costs			148				146				1,800				1,232
Showroom opening and closing costs			—				174				147				956
Non-operating facility expense			614				—				1,578				—
Adjusted EBITDA		$	8,845			$	2,871			$	1,945			$	(20,825)

Reconciliation of GAAP Gross Profit to Adjusted Gross Profit 

A reconciliation of GAAP gross profit to the non-GAAP measures of adjusted gross profit is provided below. Adjusted gross profit represents net revenue less adjusted cost of revenue. Adjusted cost of revenues represents cost of revenues excluding restructuring charges recorded in cost of revenues. We believe adjusted gross margin provides additional useful information with respect to the impact of the restructuring and provides meaningful measures of our operating performance.

(in thousands)		Three Months Ended December 31,								Year Ended  December 31,
		2025				2024				2025				2024
Revenues, net		$	140,688			$	128,975			$	468,725			$	487,877
Total cost of revenues			81,709				73,696				280,166				306,745
Restructuring charges in cost of revenues			—				(2,583)				(995)				(15,442)
Adjusted cost of revenues			81,709				71,113				279,171				291,303
Adjusted gross profit		$	58,979			$	57,862			$	189,554			$	196,574
Adjusted gross profit %			41.9 %				44.9 %				40.4 %				40.3 %

Reconciliation of GAAP Operating Expenses to non-GAAP Adjusted Operating Expenses 

Our presentation of adjusted operating expenses assumes adjustments for certain nonrecurring items that we do not believe directly reflects our current core operations. Adjusted operating expenses is a supplemental measure of operating performance that does not represent, and should not be considered, alternatives to net loss and earnings per share, as calculated in accordance with GAAP. We believe adjusted operating expenses supplements GAAP measures and enables us to more effectively evaluate our performance period-over-period. A reconciliation of operating expenses, the most directly comparable GAAP measure, to adjusted operating expenses is set forth below:

(in thousands, except per share amounts)		Three Months Ended December 31,								Year Ended December 31,
		2025				2024				2025				2024
Total operating expenses		$	61,164			$	62,973			$	231,588			$	273,315
Restructuring, impairment and other related charges			—				(1,092)				(11,387)				(19,973)
Strategic alternative costs			(5,317)				—				(7,275)				—
Adjusted operating expenses		$	55,847			$	61,881			$	212,926			$	253,342

Reconciliation of GAAP Net Loss to non-GAAP Adjusted Net Loss and Adjusted Net Loss per Diluted Share 

Our presentation of adjusted net loss assumes that all net loss is attributable to Purple Innovation, Inc. (i.e. there is no allocation of net loss to noncontrolling interests), which assumes the full exchange at the beginning of the period of all outstanding Paired Securities for shares of Class A common stock of Purple Innovation, Inc., adjusted for certain nonrecurring items that we do not believe directly reflect our core operations. Adjusted net loss per share, diluted, is calculated by dividing adjusted net loss by the total shares of Class A common stock outstanding plus any dilutive warrants, options and restricted stock as calculated in accordance with GAAP and assuming the full exchange of all outstanding Paired Securities as of the beginning of each period presented. Adjusted net loss and adjusted net loss per diluted share, are supplemental measures of operating performance that do not represent, and should not be considered, alternatives to net loss and earnings per share, as calculated in accordance with GAAP. We believe adjusted net loss and adjusted net loss per diluted share, supplement GAAP measures and enable us to more effectively evaluate our performance period-over-period. A reconciliation of net loss, the most directly comparable GAAP measure, to adjusted net loss and the computation of adjusted net loss per diluted share, are set forth below:

(in thousands, except per share amounts)		Three Months Ended December 31,								Year Ended December 31,
		2025				2024				2025				2024
Net loss		$	(3,226)			$	(8,511)			$	(51,511)			$	(98,098)
Income tax expense, as reported			59				113				207				63
Revenue reduction due to SGI Contract			941				—				2,508				—
Change in fair value – warrant liabilities			(5,883)				(3,615)				(17,202)				(3,504)
Loss on extinguishment of debt			—				—				—				3,394
Restructuring related charges			—				3,675				12,382				35,415
Gain on insurance proceeds			—				(7,301)				—				(11,601)
Strategic alternative costs			5,317				—				7,275				—
Adjusted net loss before income taxes			(2,792)				(15,639)				(46,341)				(74,331)
Adjusted income tax benefit(1)			723				4,051				12,002				19,252
Adjusted net loss		$	(2,069)			$	(11,588)			$	(34,339)			$	(55,079)
Adjusted net loss per share, diluted		$	(0.02)			$	(0.11)			$	(0.32)			$	(0.51)
Adjusted weighted-average shares outstanding, diluted(2)			108,409				107,710				108,245				107,324

(1) Represents the estimated effective tax rate of 25.9% for the three and twelve months ended December 31, 2025 and 2024, applied to adjusted net income before income taxes. The estimated effective tax rates are what the Company would be subject to and consist of the combined federal statutory tax rate and the Company's blended state tax rates.

(2) Assumes options and restricted stock units calculated in accordance with GAAP and the full exchange of all outstanding Paired Securities for shares of Class A common stock as of the beginning of the period.

A reconciliation of net income (loss) per share, diluted, to adjusted net loss per diluted share is set forth below for the three and twelve months ended December 31, 2025 and 2024:

		For the Three Months Ended
		December 31, 2025												December 31, 2024
		Net Loss				Weighted Average Shares, Diluted				Net Income per Share, Diluted				Net Loss				Weighted Average Shares, Diluted				Net Income per Share, Diluted
Net loss attributable to Purple Innovation Inc.(1)		$	(3,212)				108,409				(0.03)			$	(8,479)				107,710			$	(0.08)
Assumed exchange of shares(2)			(14)				—								(32)				—
Net loss			(3,226)												(8,511)
Adjustments to arrive at adjusted loss before taxes(3)			434												(7,128)
Adjusted loss before taxes			(2,792)												(15,639)
Adjusted income tax benefit(4)			723												4,051
Adjusted net loss		$	(2,069)				108,409				(0.02)			$	(11,588)				107,710			$	(0.11)

(1) Represents net loss attributable to Purple Innovation, Inc. and the associated weighted average diluted shares, of Class A common stock outstanding. For the three months ended December 31, 2025, the Paired Securities are included in the beginning weighted average shares, diluted.

(2) Assumes the full exchange of all outstanding Paired Securities for shares of Class A common stock as of the beginning of the period if not already included in weighted average diluted shares in footnote (1) above. Also assumes the addition of net income attributable to noncontrolling interests corresponding with the assumed exchange of the Paired Securities for shares of Class A common stock.

(3) Represents the total impact of all adjustments identified in the adjusted net income table above to arrive at adjusted income before income taxes. Also assumes the dilutive warrants, options and restricted stock as calculated in accordance with GAAP.

(4) Represents the estimated effective tax rate of 25.9% for the three months ended December 31, 2025 and 2024, applied to adjusted net income before income taxes. The estimated effective tax rates are what the Company would be subject to and consist of the combined federal statutory tax rate and the Company's blended state tax rates assuming no valuation allowance.

 

		For the Year Ended
		December 31, 2025												December 31, 2024
		Net Income				Weighted Average Shares, Diluted				Net Income per Share, Diluted				Net Income				Weighted Average Shares, Diluted				Net Income per Share, Diluted
Net loss attributable to Purple      Innovation Inc.(1)		$	(51,414)				108,245				(0.48)			$	(97,897)				107,324			$	(0.91)
Assumed exchange of shares(2)			(97)				—								(201)				—
Net loss			(51,511)												(98,098)
Adjustments to arrive at adjusted loss           before taxes(3)			5,170												23,767
Adjusted loss before taxes			(46,341)												(74,331)
Adjusted income tax benefit(4)			12,002												19,252
Adjusted net loss		$	(34,339)				108,245				(0.32)			$	(55,079)				107,324			$	(0.51)

(1) Represents net loss attributable to Purple Innovation, Inc. and the associated weighted average diluted shares, of Class A common stock outstanding. For the year ended December 31, 2025, the Paired Securities are included in the beginning weighted average shares, diluted.

(2) Assumes the full exchange of all outstanding Paired Securities for shares of Class A common stock as of the beginning of the period if not already included in weighted average diluted shares in footnote (1) above. Also assumes the addition of net income attributable to noncontrolling interests corresponding with the assumed exchange of the Paired Securities for shares of Class A common stock.

(3) Represents the total impact of all adjustments identified in the adjusted net income table above to arrive at adjusted income before income taxes. Also assumes the dilutive warrants, options and restricted stock as calculated in accordance with GAAP.

(4) Represents the estimated effective tax rate of 25.9% for the year ended December 31, 2025 and 2024, applied to adjusted net income before income taxes. The estimated effective tax rates are what the Company would be subject to and consist of the combined federal statutory tax rate and the Company's blended state tax rates assuming no valuation allowance.

 

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SOURCE Purple Innovation, LLC

FAQ

What were Purple Innovation (PRPL) fourth-quarter 2025 results?

Purple reported Q4 2025 revenue of $140.7M and a GAAP net loss of $3.2M, with adjusted EBITDA of $8.8M. According to Purple, revenue rose ~9.1% driven by wholesale growth, while e-commerce weakness partially offset gains.

How did Purple Innovation perform for full-year 2025 (PRPL)?

Full-year 2025 revenue was $468.7M, down 3.9%, with a net loss of $51.4M and adjusted EBITDA of $1.9M. According to Purple, gross margin expanded to 40.2% due to sourcing, restructuring, and manufacturing efficiencies.

What guidance did Purple Innovation (PRPL) give for 2026 revenue and earnings?

Purple expects 2026 revenue of $500–$520M and adjusted EBITDA of $20–$30M. According to Purple, this outlook reflects improved margins and cost structure following 2025 restructuring and wholesale expansion.

What is Purple Innovation's cash and inventory position at year-end 2025 (PRPL)?

As of December 31, 2025, Purple had $24.3M in cash and cash equivalents and net inventories of $59.7M. According to Purple, cash declined from $29.0M year-over-year while inventories rose 5.0% versus December 31, 2024.

What drove Purple Innovation's Q4 2025 margin improvement (PRPL)?

Q4 margin gains came from sourcing savings, profitable inventory liquidation, and plant efficiencies, producing a 41.9% gross margin. According to Purple, restructuring benefits and volume leverage also supported the margin expansion.