Luvu Brands reported QQ1 2025 revenue of $5.756 million, marking a QoQ increase of 0.3% but a YoY decline of approximately 6.0%. The gross margin expanded modestly to about 26.36%, producing gross profit of $1.518 million, yet operating income remained negative at $0.122 million and EBITDA was essentially breakeven at approximately -$0.013 million. Net income registered a loss of $0.210 million, or -$0.0027 per share, reflecting ongoing fixed cost leverage challenges in a small-scale consumer discretionary business.
From a liquidity and cash flow perspective, the company generated $0.132 million in operating cash flow and $0.131 million in free cash flow for QQ1 2025, with cash and cash equivalents totaling $1.069 million at period end. Total debt stood at $3.944 million, leaving a net debt position of about $2.876 million. The balance sheet shows a solid current asset base of $5.441 million against current liabilities of $4.548 million, producing a current ratio of 1.20 and a quick ratio of 0.54, suggesting manageable near-term liquidity but modest coverage for a rapid deterioration in working capital. The business exhibits elevated inventory levels relative to receivables, contributing to a modest working capital cycle. Management commentary and earnings call transcripts were not provided in the dataset, limiting qualitative color on strategic pivots or guidance.
Overall, LUVU demonstrates revenue stability in a constrained tailwind environment but continues to grapple with profitability on a non-operating scale. The quarter’s cash generation supports a cautious liquidity stance, while balance sheet metrics reflect a leveraged, small-cap profile typical of niche consumer brands. Key questions for investors center on margin normalization, net working capital optimization, and revenue acceleration through product mix, direct-to-consumer channels, or international expansion.