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Oct 30, 2022
Lovesac Q3 2023 Earnings Report
Reported a net sales increase of 15.5% and comparable sales growth of 8.9% driven by growth across showrooms and other channels, partially offset by a decline in the internet channel.
Key Takeaways
Lovesac reported a 15.5% increase in net sales and 8.9% comparable sales growth in Q3 2023. Growth was driven by showrooms and other channels, but partially offset by a decline in internet sales. The company is focused on managing expenses and prioritizing critical spending amid inflationary pressures.
Net sales increased by 15.5% due to growth in Showroom and 'Other' channels, offset by a decline in the Internet channel.
Showroom net sales increased by 19.0%, driven by a comparable showroom sales increase of 18.5% and the addition of new showrooms and kiosks.
Internet net sales decreased by 6.3% due to a shift back to in-person shopping.
Gross profit increased by 8.5% to $63.6 million, primarily due to the increase in net sales.
Lovesac
Lovesac
Forward Guidance
The company anticipates continued inflationary pressure and is focused on tight expense management. Early signs point to strong cash flow generation for the fourth quarter holiday season.
Positive Outlook
- Well-executed and balanced omni-channel strategy
- Innovative products
- Continued momentum from inflecting brand awareness
- Customer adoption bolstered by industry-leading in-stock position
- Vast addressable market at $46.2 billion for couch + home audio categories
Challenges Ahead
- Challenging backdrop
- Continued inflationary pressure on consumers
- Tight expense management
- Careful prioritization of critical spending
- Operating loss of $11.6 million