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Jun 30, 2022
Purple Q2 2022 Earnings Report
Purple's financial performance declined due to macroeconomic headwinds and reduced advertising spend.
Key Takeaways
Purple Innovation reported a decrease in net revenue and a shift to a net loss for Q2 2022. The company faced challenges due to a shift in demand away from home-related categories, the impact of inflation on consumer discretionary spending, and an intentional reduction in advertising spend.
Net revenue decreased by 21.1% to $144.1 million compared to the second quarter of 2021.
Gross margin declined to 33.9% compared to 44.7% in the prior year period.
Operating loss was $(12.1) million, compared to $(2.5) million in the prior year period.
Net loss was $(8.3) million, compared to net income of $2.6 million in the prior year period.
Purple
Purple
Forward Guidance
The Company is amending its 2022 outlook and now expects full year 2022 net revenue to be between $570 million and $590 million. Adjusted EBITDA for 2022 is now expected to be between $(15) million and $(5) million.
Positive Outlook
- Second half 2022 gross margins are expected to improve compared with second quarter 2022 levels.
- Company expects to exit the year with gross margins between 37% to 38%.
Challenges Ahead
- Full year 2022 net revenue is expected to be between $570 million and $590 million, compared with its prior range of $650 million to $690 million.
- Adjusted EBITDA for 2022 is now expected to be between $(15) million and $(5) million, compared with its prior range of $21 million to $27 million.