La-Z-Boy delivered a solid third quarter in fiscal 2025, highlighted by a 4% year-over-year revenue increase to $521.8 million and a non-GAAP operating margin of 6.8%, up 20 basis points from the prior year. GAAP diluted EPS was $0.68, with net income of $28.4 million. The company demonstrated robust operating cash flow ($57.0 million in the quarter) and finished the period with $315 million of cash and no externally funded debt, signaling strong liquidity and financial flexibility to fund growth initiatives, share repurchases, and strategic investments.
Management attributes the outperformance to continued progress on Century Vision, including a higher mix of higher-margin retail sales, accretive company-owned store openings, and a stabilized Joybird performance that reached breakeven profitability. Retail delivered sales rose 11% year-over-year driven by same-store growth, while Joybird improved to breakeven on operating profit as it leverages an omni-channel approach. Wholesale delivered sales increased 2%, aided by a favorable product and channel mix in North America, offset by a transition in the international business. The company reiterated its guidance for Q4: delivered sales around $545 million and non-GAAP operating margins of 8.5%–9.5%, implying a modest second-half acceleration as store openings ramp and international headwinds gradually abate.
Key strategic takeaways include: (i) continued expansion of the La-Z-Boy Furniture Galleries network toward a target of 400+ stores (197 company-owned and 362 total as of the quarter), (ii) ongoing strategic partnerships and channel expansion to broaden brand reach, (iii) margin discipline and cost improvements within the North American wholesale core, and (iv) a deliberate plan to manage international transitions (UK with DFS) while pursuing margin recovery over time. The near-term risks center on macro softness in housing, tariff dynamics, and execution tempo for international partnerships. Overall, the quarter reinforces La-Z-Boy’s ability to grow and improve profitability within a challenged furniture cycle, supported by a strong balance sheet and disciplined capital allocation.