Vera Bradley’s QQ3 2025 results reflect a challenging period of strategic transformation under Project Restoration, with a sharp revenue decline year over year and a resulting net loss. Consolidated net revenues totaled $80.6 million, down from $115.0 million in the prior-year quarter, and the company reported a net loss of $12.8 million ($0.46 per share) versus $6.1 million net income last year. Management highlighted meaningful progress on brand repositioning, customer acquisition, and cost discipline, describing several “green shoots” including a 700 basis-point Ipsos awareness increase since 2021, stronger engagement with higher-income households, and improving performance in digital channels and select partnerships. However, gross margin remained under pressure from promotional activity, with non-GAAP gross margin at 54.1% (vs 54.8% a year ago), and SG&A deleveraging on a lower top-line base contributed to an ≈$10.5 million operating loss for the quarter.
Management reiterated that the strategic shift is ongoing and that the near-term focus remains on reducing low-margin revenue, optimizing inventory and sourcing, and expanding higher-margin initiatives such as heritage prints, elevated price-point offerings, and IP collaborations. The company provided conservative guidance for fiscal 2025, projecting revenue of about $385 million, gross margin around 52.5%, and an operating loss of about $9 million, with an EPS around a $0.25 loss. End-of-year cash is guided to roughly $35 million with inventory down about 5% from the prior year and about 10% lower on a unit basis. The commentary underscored progress in direct-to-consumer, digital spend efficiency, and ongoing discussions with potential brand partners which, if realized, could broaden Vera Bradley’s addressable market and improve margins over time.