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Dec 30, 2024
Purple Q4 2024 Earnings Report
Purple Innovation, Inc. reported its financial results for the fourth quarter and full year ended December 31, 2024, showing a return to positive Adjusted EBITDA and cash flow in the fourth quarter.
Key Takeaways
Purple Innovation, Inc. achieved a significant milestone in Q4 2024, returning to positive Adjusted EBITDA and generating positive cash flow after eight quarters, driven by disciplined execution, operational improvements, and strategic cost-saving initiatives.
Returned to positive Adjusted EBITDA and cash flow in the fourth quarter for the first time in eight quarters.
GAAP Gross Margin improved significantly to 42.9% in Q4 2024, an increase of 970 basis points year-over-year.
Adjusted Gross Margin expanded to 44.9% in Q4 2024, an improvement of over 810 basis points year-over-year.
Generated incremental liquidity with a new $19.0 million Term Loan increase to support continued investments in innovation and advertising.
Purple
Purple
Forward Guidance
For 2025, Purple Innovation, Inc. expects full year revenue to be in the range of $465 million to $485 million and adjusted EBITDA to be in the range of flat to positive $10 million. The Company anticipates sequential improvement in quarterly revenue and adjusted EBITDA performance throughout the year.
Positive Outlook
- Anticipated return to positive Adjusted EBITDA for the full year 2025.
- Expected sequential improvement in quarterly revenue and adjusted EBITDA performance.
- Continued focus on driving cost savings beyond the 2024 restructuring plan.
- Plans to bring new products to market from a robust innovation pipeline, including Rejuvenate 2.0 launch in Q2.
- Confidence in building on a strong foundation and driving improved profitability.
Challenges Ahead
- Full year 2025 revenue guidance of $465 million to $485 million is lower than 2024 actual revenue of $487.9 million.
- First quarter 2025 adjusted EBITDA is expected to be negative, in the range of $(6) million to $(9) million.
- Continued industry softness is a factor in revenue decline.
- Cycling the 2023 launch of new mattress lines impacts revenue comparison.
- The company is unable to provide a quantitative reconciliation for the full year 2025 Adjusted EBITDA outlook due to inherent difficulties in forecasting certain adjusting items.