“Traffic remains challenged. And I think you hear that across virtually all of the companies that have reported recently. What we definitely see is traffic strengthening around those major holidays.”
— Melinda Whittington
03Detailed Report
LZB
Company LZB
Period
Q1 2025
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 13, 2026
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Executive Summary
- Quarter highlights: La-Z-Boy reported consolidated delivered sales of $496 million for QQ1 2025, up 3% year over year, with the Wholesale segment delivering a 5% increase to external customers. Non-GAAP operating margin stood at 6.6% and non-GAAP diluted EPS was $0.62, supported by robust operating cash flow of $52 million and shareholder distributions totaling about $42 million. The company ended the period with roughly $342 million in cash and indicated no external debt, reinforcing balance-sheet flexibility as Century Vision unfolds.
- Market backdrop and strategic posture: Management reiterated that the furniture/home furnishings market remains challenged by elevated mortgage rates, housing costs, and macro uncertainty, yet remains confident that Century Vision — including accelerating store growth, brand expansion (La-Z-Boy and Joybird), and supply-chain enhancements — can drive above-market growth and double-digit operating margins over the long term. The company signaled ongoing acquisitions and new-store openings (one store closed within QQ1 and two additional independent-store deals signed for Florida, with closing in Q2).
- Outlook and near-term dynamics: For the second quarter, management guided $495M–$515M in sales and 6%–7% non-GAAP operating margin, acknowledging near-term margin compression from negative same-store sales and mix shifts toward lower-margin wholesale channels. They expect 12–15 new La-Z-Boy Furniture Galleries stores to open in the year, with further investment in Century Vision initiatives. Management also signaled ongoing macro risk to full-year industry demand, but remained committed to outperforming the market through brand and channel initiatives, cost discipline, and capital allocation geared to reinvestment and shareholder value.
Key Performance Indicators
Revenue
Increasing
495.53M
QoQ: -10.48% | YoY: 2.88%
Gross Profit
Increasing
213.34M
43.05% margin
QoQ: -11.14% | YoY: 3.70%
Operating Income
Decreasing
32.37M
QoQ: -36.90% | YoY: -6.24%
Net Income
Decreasing
26.16M
QoQ: -33.45% | YoY: -4.80%
EPS
Decreasing
0.62
QoQ: -32.61% | YoY: -3.13%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue and profitability:
- QQ1 2025 revenue: $495.532 million (reported as $496 million in call materials), YoY growth +2.88%; QoQ decline not explicit in the data provided (3Q to QQ1 context referenced in comments).
- Gross profit: $213.343 million; gross margin 43.05% (0.4305). YoY gross profit up 3.70%; QoQ down 11.14%.
- Operating income: GAAP $32.37 million; non-GAAP $33.00 million; GAAP operating margin 6.53%; non-GAAP 6.60%.
- Net income and earnings: Net income $26.159 million; net margin 5.28%. GAAP diluted EPS $0.61; non-GAAP diluted EPS $0.62 (unchanged YoY).
- Cash flow and capital deployment: Operating cash flow $52.32 million; free cash flow $36.70 million. Capital expenditures $16.20 million; acquisitions $7.00 million. Dividends paid and share repurchases totaled ~$42.0 million (dividends $8.37M; repurchases ~$33.67M). Cash and cash equivalents at period end: $342.27 million. Net debt (per the balance sheet): $141.99 million.
- Balance sheet health: Total assets $1,917.62 million; total liabilities $907.14 million; total stockholders’ equity $999.21 million. Current ratio 1.90; quick ratio 1.28; cash ratio 0.78. Debt mix includes short-term debt of approximately $154.49 million and long-term debt of approximately $407.01 million (reported ranges in the file show inter-period consistency with net debt of ~$142 million).
- Operational momentum: Company-owned Furniture Galleries network ended QQ1 at 356 stores (188 company-owned), representing 53% of the network; the company aims to reach roughly 400 total stores over the next several years and to grow the company-owned share.
- Segment highlights: Wholesale delivered sales $351 million (+5% YoY); Retail delivered sales $202 million (-3% YoY). Wholesale margin improved to 6.9% (vs. 6.8% prior year), driven by gross-margin expansion; Retail margin declined to 10.3% (vs. 14.1% prior year) due to fixed-cost deleverage and investment in growth initiatives. Joybird delivered $35 million, down 3% YoY, with ongoing profitability focus.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
495.53M
2.88%
-10.48%
Gross Profit
213.34M
3.70%
-11.14%
Operating Income
32.37M
-6.24%
-36.90%
Net Income
26.16M
-4.80%
-33.45%
EPS
0.62
-3.13%
-32.61%
Key Financial Ratios
Gross Profit Margin
Good
43.10%
Gross profit margin is healthy and competitive within industry standards
Operating Profit Margin
Fair
6.53%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Fair
5.28%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
1.36%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
2.62%
Return on equity suggests inefficient capital allocation
Current Ratio
Healthy
1.90
Current ratio shows adequate liquidity to meet short-term obligations
Debt to Equity
Moderate
0.49
Debt-to-equity indicates balanced capital structure with manageable debt
P/E Ratio
Fair Value
17.50x
P/E ratio in line with market averages
Price to Book
Fair Value
1.83x
Price-to-book ratio reasonable for profitable companies
Management Insights Available for Members
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