La-Z-Boy reported a modest quarterly decline in consolidated revenue with meaningful margin dynamics by segment. Consolidated sales dipped 1% year over year to $492.2 million, reflecting strength in Retail and Wholesale offset by weaker Joybird performance. Adjusted operating margin stood at 4.8% (GAAP 4.5%), with Wholesale margin at 7.5% (versus 6.9% prior year), driven by lower warranty and marketing costs and ongoing gross margin expansion in core North America Wholesale. Retail margin faced de-leverage pressures from new store openings and elevated fixed costs, contributing to Retail adjusted margin of 6.3% (vs. 10.3% prior year). The company advanced the Century Vision agenda, highlighted by the first centralized Arizona distribution hub and a planned 15-store Gulf Coast/Southeast acquisition expected to add roughly $40 million in consolidated sales and access to key growth markets (Florida, Georgia, Tennessee).
La-Z-Boy also reiterated a disciplined capital allocation framework: maintaining a fortress balance sheet with $319 million in cash and no external debt, extending the revolver to 2030, and signaling near-term capital will be deployed toward investments in new stores, acquisitions, and the distribution transformation. Management guided for Q2 revenue of $510β$530 million and adjusted operating margin of 4.5β6%, signaling an expected near-term margin drag from transition costs that should ease as the distribution transformation matures (progress anticipated in year 3β4). ν¬μμ should monitor consumer demand dynamics, store productivity ramp, ongoing Joybird performance, and the progress of the wholesale distribution transformation as primary determinants of profitability in the coming quarters.