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Sep 30, 2020
Purple Q3 2020 Earnings Report
Reported record third quarter results driven by strong demand and increased manufacturing capacity.
Key Takeaways
Purple Innovation reported a 59.4% increase in net revenue to $187.1 million and a 120.9% increase in operating income to $24.3 million compared to the third quarter of 2019. The company's cash and cash equivalents increased to $98.0 million as of September 30, 2020.
Net revenue increased by 59.4% to $187.1 million compared to the third quarter of 2019.
Operating income increased by 120.9% to $24.3 million compared to the prior year period.
Gross margin improved to 47.2% compared to 45.0% in the year ago period.
Cash and cash equivalents increased to $98.0 million as of September 30, 2020.
Purple
Purple
Forward Guidance
The Company expects year-over-year quarterly growth rates similar to Q3 in revenue and adjusted EBITDA balanced with a modest channel shift toward wholesale and the planned Q4 investments in people, capacity, showrooms and infrastructure.
Positive Outlook
- Expects year-over-year quarterly growth rates similar to Q3 in revenue
- Expects year-over-year quarterly growth rates similar to Q3 in adjusted EBITDA
- Planned Q4 investments in people
- Planned Q4 investments in capacity
- Planned Q4 investments in showrooms and infrastructure
Challenges Ahead
- Q4 is historically a more promotional quarter, with increased marketing expense
- Modest channel shift toward wholesale
- Company continues to manage supply chain challenges from supply of foam and coils
- Supply chain issues could limit its ability to manufacture
- Supply chain issues could limit its ability to fulfill a portion of demand in the fourth quarter