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What were the key takeaways from La-Z-Boy's earnings call?

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- **Revenue Growth**: Total delivered sales of $522 million, with Wholesale segment up 2% and Retail segment showing sequential improvement in same-store sales.
- **Strategic Acquisitions**: Completed 15-store acquisition, adding $80 million in annual sales, and exited noncore businesses to focus on core upholstery business.
- **Margin Expansion**: Adjusted operating margin of 7.1%, driven by Wholesale segment efficiency and cost control. Q3 guidance includes 50-75 basis points of margin improvement from supply chain transformation.
- **Cash Flow and Dividends**: Generated $50 million in operating cash flow, triple prior year. Announced 10% dividend increase, marking five consecutive years of growth.
- **Risk Management**: 90% of products manufactured in the U.S., mitigating tariff risks, with nominal pricing adjustments to offset remaining exposure.


**【Management Opening Remarks】**
- Mark Becks provided an overview of the call, emphasizing forward-looking statements and the availability of the earnings release and replay. He highlighted the company's strong financial position and commitment to shareholder returns.

**【CEO Summary Section】**
- **Q2 2026 Results**: Total delivered sales of $522 million, up slightly year-over-year. Retail segment delivered sales increased slightly, with total written sales up 4% and same-store sales improving sequentially. Wholesale segment delivered sales grew 2%, driven by North American La-Z-Boy business.
- **Strategic Initiatives**: Completed acquisition of 15 independent stores, adding $80 million in annual retail sales. Exited noncore businesses (Kincaid casegoods, American Drew casegoods) and announced closure of U.K. manufacturing facility. Consolidated 2 distribution centers as part of a multiyear supply chain transformation.
- **Financial Highlights**: GAAP operating margin of 6.9%, adjusted operating margin of 7.1%. Generated $50 million in operating cash flow, triple the prior year. Announced 10% dividend increase, marking five consecutive years of double-digit growth.
- **Market Positioning**: Named to Forbes' 2026 Best Customer Service list and rolled out new brand identity, generating positive consumer response.

**【CFO Financial Commentary】**
- **Consolidated Results**: GAAP EPS of $0.70, adjusted EPS of $0.71, flat year-over-year. Consolidated adjusted gross margin increased 10 basis points due to lower input costs, partially offset by supply chain friction costs.
- **Segment Performance**: Retail segment margin deleveraged due to lower same-store sales and new store investments. Wholesale segment margin improved 160 basis points, driven by lower warranty expenses and operational efficiency gains.
- **Liquidity and Capital Allocation**: Ended the quarter with $339 million in cash. Generated $50 million in operating cash flow, up from $17 million prior year. Capital expenditures of $20 million for new stores and supply chain investments. Returned $31 million to shareholders via dividends and share repurchases.
- **Q3 Guidance**: Sales expected in the range of $525 million to $545 million (1% to 4% YoY growth). Adjusted operating margin expected to be 5% to 6.5%, reflecting friction costs from portfolio optimization and macroeconomic uncertainty.

**【Q&A Key Highlights】**
- **Geographic Sales**: Canada remains challenging due to trade tariffs, but no significant regional disparities in the U.S.
- **Pricing Strategy**: Implemented nominal pricing adjustments to offset tariffs, with 90% of products manufactured in the U.S. Volume in the North American wholesale business was flat year-over-year.
- **Friction Costs**: Distribution transformation and portfolio optimization initiatives will impact Q3 margins, but long-term benefits include 50-75 basis points of margin improvement.
- **Inventory Management**: Tight working capital management reduced inventory levels, with no impact on in-stock rates.
- **Capital Allocation**: Fiscal 2026 capital spending tilted toward business reinvestment (e.g., distribution transformation, new stores). Dividend increases and share buybacks remain priorities for returning cash to shareholders.


La-Z-Boy Incorporated (LZB) Q2 2026 Earnings Call Transcript

- **Revenue Growth**: Retail sales +2%, Wholesale +1%, despite industry headwinds. 15-store acquisition in Southeast to add $40M in incremental sales.
- **Margin Expansion**: Wholesale margin up 60 bps to 7.5%, driven by cost control. Distribution transformation to deliver 50-75 bps margin improvement over 4 years.
- **Balance Sheet Strength**: $319M cash, no debt. Q1 operating cash flow $36M. Share buybacks and dividend returns $22M.
- **Strategic Momentum**: Named #1 furniture retailer. 15 new stores planned for FY26, 3-4 Joybird openings. Distribution project on track with first hub operational.
- **Challenges**: Retail margin compression (-400 bps), Joybird sales decline (-20%). Consumer environment remains challenging with housing lows and traffic depression.

**【CEO Summary Section】**
- **Retail Segment Growth**: Q1 sales increased 2% (written sales +5%), driven by 13 new company-owned stores over 12 months and a 15-store acquisition in the Southeast (expected to close in October). Total retail footprint expanded to 205 company-owned stores (56% of 368 total network). Joybird sales declined 20%, but physical store performance outperformed online.
- **Wholesale Segment Expansion**: Delivered sales grew 1%, led by core North American La-Z-Boy business. Transitioned to a new Arizona distribution hub, first of 3 centralized hubs aiming to reduce costs and improve agility. Strong cash flow ($36M) and no external debt, with $319M in cash.
- **Strategic Initiatives**: Named #1 in furniture category by Newsweek. Launched updated brand campaign and Lazy Boy rebranding. Distribution transformation project expected to improve wholesale margins by 50-75 bps over 4 years.
- **Challenges**: Same-store sales down 4% in Retail, Joybird sales down 14%, and industry headwinds (housing lows, consumer pressure). Adjusted operating margin pressured to 4.8% due to store investments and de-leverage.

**【CFO Financial Commentary】**
- **Consolidated Results**: Q1 sales $492M (-1% YoY). GAAP EPS $0.44, adjusted EPS $0.47. Retail margin 6.3% (-400 bps YoY), Wholesale margin 7.5% (+60 bps YoY). Consolidated gross margin down 30 bps, SG&A up 150 bps due to store investments.
- **Segment Breakdown**: Retail sales $207M (+2%), Wholesale $353M (+1%). Joybird sales $28M (-20%). Wholesale margin expansion driven by lower warranty and marketing costs. Joybird operating loss widened due to low volume.
- **Liquidity & Capital Allocation**: Generated $36M cash flow. Capital expenditures $18M (stores, manufacturing). Share buybacks $22M (300K shares). Fiscal 2026 capex guidance $90-100M, with focus on distribution transformation and new stores.
- **Guidance**: Q2 sales $510-530M, adjusted margin 4.5-6%. Distribution project to drag margins for 2 years before savings materialize in year 3-4.

**【Q&A Highlights】**
- **Trends & Consumer Sentiment**: Sequential improvement in traffic and written sales in Q1, with early August trends positive but too early to confirm. Wholesale customers prefer La-Z-Boy's North American supply chain stability amid tariff uncertainty.
- **Store Ramp-Up**: New stores typically take 3 years to reach full profitability. Q1 margin pressure from 13 new stores over 12 months. Joybird store openings (3-4 in FY26) focus on physical experience over online.
- **Distribution Project**: Arizona hub transition complete. Project to reduce distribution costs, improve delivery radius (75→150 miles), and enable 30% sq. footage reduction. Marginal drag on margins for 2 years, with savings flowing in year 3-4.
- **Non-Core Businesses**: Evaluating alternatives for underperforming segments (e.g., international wholesale). Focus on core Retail and Wholesale businesses with strong cash flow and balance sheet flexibility.

La-Z-Boy Incorporated (LZB) Q1 2026 Earnings Call Transcript

- **Q4 Sales Beat Guidance**: $571M (+3% YoY), driven by 8% Retail growth and North America Wholesale momentum.
- **Cash Flow Strength**: $187M operating cash flow (+18% YoY), returning $113M to shareholders via buybacks and 10% dividend hike.
- **Store Expansion**: 11 new company-owned stores opened in FY2025, now owning 55% of 366-store network.
- **Joybird Recovery**: FY2025 sales +5%, with 13 stores and 3-4 new openings planned for FY2026.
- **Wholesale Margin Path**: Targeting 10%+ via distribution efficiency ($0.5M/year) and industry recovery.
- **Tariff Mitigation**: Nominal pricing (+low single digits) and inventory moves limit Q1 impact.

**【CEO Summary Section】**
- Fiscal 2025 Q4 delivered sales of $571 million, up 3% YoY, driven by Retail segment growth (+8%) and Wholesale core North America business (+2%).
- Full year consolidated sales reached $2.1 billion (+3% YoY), with Retail segment growing 5% and Wholesale 2%.
- Generated $187 million in operating cash flow (+18% YoY), returning $113 million to shareholders via dividends and buybacks.
- Opened 11 new company-owned stores (most in 20+ years) and acquired 7, now owning 55% of the 366-store network.
- Joybird sales grew 5% YoY, with 13 stores and plans for 3-4 new openings in FY26.

**【CFO Financial Commentary】**
- Q4 adjusted EBITDA of $54 million (+3% YoY), with Retail margin 13.1% and Wholesale 8.5%.
- FY2025 adjusted EBITDA of $161 million (+1% YoY), with gross margin improving 70bps to 38.3%.
- FY2026 Q1 guidance: sales $490-510 million, adjusted margin 5.5-7%, reflecting U.K. transition and distribution network investments.
- Capital allocation: 50% reinvested in business, 50% returned to shareholders (FY25: 48% reinvested, 52% returned).

**【Q&A Key Takeaways】**
- Wholesale margin expansion to 10%+ requires industry normalization and $0.5M/year in distribution efficiency gains.
- Tariff mitigation via nominal pricing (+low single digits) and strategic inventory moves, with minimal Q1 impact.
- Joybird physical stores outperforming digital, with 3-4 new openings in FY26 targeting urban, younger consumers.
- Supply chain resilience demonstrated by 1-week recovery from Arkansas plant damage, supporting consumer delivery timelines.
- Long-term outlook: double-digit Wholesale margins, 400+ store network, and brand refresh to drive DTC growth.

La-Z-Boy Incorporated (LZB) Q4 2025 Earnings Call Transcript

- **Topline Growth**: 4% Q3 sales beat industry trends, driven by 11% Retail and 9% Joybird growth.
- **Margin Expansion**: Non-GAAP margin +20bps to 6.8%, with Joybird breakeven after restructuring.
- **Strategic Momentum**: 362 total stores, 14-16 new openings FY25, and $125M free cash flow.
- **Challenges**: International Wholesale headwinds persist, but core North America business improving.
- **Tariff Resilience**: Agnostic supply chain and pricing actions to offset potential trade disruptions.


**【CEO Opening Remarks】**
- Q3 2025 delivered sales of $522 million, up 4% YoY, driven by 11% growth in the Retail segment and 2% in Wholesale. Joybird sales increased 9%.
- Non-GAAP operating margin expanded 20bps to 6.8%, with Retail same-store sales up 7% and Joybird achieving breakeven profitability.
- Strategic initiatives: 3 new company-owned stores opened, 2 acquired in Ohio, and 2 more to be acquired in Michigan. Total Furniture Galleries network expanded to 362 stores.
- Joybird's Pantone collaboration and Lincoln Park concept store highlight brand innovation and consumer engagement.

**【CFO Financial Review】**
- GAAP diluted EPS: $0.68 (vs. $0.66 prior year). Non-GAAP EPS: $0.68 (vs. $0.67 prior year).
- Gross margin improved 160bps to 34.2%, driven by lower input costs and Retail segment mix. SG&A as % of sales increased 140bps due to Retail expansion.
- Q4 2025 guidance: Sales $545-$565 million, non-GAAP margin 8.5%-9.5%. Free cash flow up 19% YoY to $125 million.
- Capital allocation: 50% reinvested in growth, 50% returned to shareholders via dividends and buybacks.

**【Q&A Key Takeaways】**
- **Sales Trends**: Q3 momentum sustained through November, with February early results mixed due to weather. Q4 outlook cautious but stable.
- **Margins**: Core North America Wholesale margin up 3q in a row; Joybird breakeven after restructuring. International headwinds expected to ease slowly.
- **Tariffs**: Proactive supply chain diversification and pricing strategies to mitigate risks.
- **Joybird Growth**: 3-4 new stores planned for FY26, focusing on profitability alongside expansion.
- **Century Vision**: 400+ store target by mid-2030s, with 54% of network now company-owned.


La-Z-Boy Incorporated (LZB) Q3 2025 Earnings Call Transcript

La-Z-Boy (LZB)-20 Nov 24-2025 Q2 Earnings call transcript

La-Z-Boy (LZB)-21 Aug 24-2025 Q1 Earnings call transcript

La-Z-Boy (LZB)-18 Jun 24-2024 Q4 Earnings call transcript

La-Z-Boy Incorporated (LZB) Q3 2024 Earnings Call Transcript

- **Revenue Growth**: Consolidated sales down 16% YoY, non-GAAP operating income $41M, EPS $0.74.
- **Design Channel**: 30% design sales, 5% avg ticket growth.
- **Supply Chain Restructuring**: 50-60bps gains post 2025Q1 closures.
- **Shareholder Returns**: $18M Q2 cash flow, 10% dividend hike.
- **Q3 Outlook**: $515-535M sales, 7-8% margins, Joybird $0.01-0.03 EPS.

**【Management Opening Remarks】**
- Mark Becks introduced the call, outlining the agenda and key executives (Melinda Whittington, CEO; Robert Lucian, CFO) while emphasizing disciplined execution and strategic initiatives.
- Highlighted the importance of the Long Live the Lazy brand campaign and supply chain restructuring.

**【CEO Commentary】**
- **Revenue Performance**: Consolidated sales decreased 16% YoY to $511M, with non-GAAP operating income of $41M and EPS of $0.74.
- **Segment Breakdown**: Retail segment sales down 15%, Wholesale segment sales down 18%, and Joybird sales down 15%.
- **Gross Margin Improvement**: 340bps YoY driven by cost control and brand campaign success.
- **Strategic Acquisitions**: 2 new stores opened and 1 independent store acquired in Lafayette, LA, contributing to 50% retail network ownership.
- **Holiday Trends**: November sales rebounded post-October softness, with early Q3 reads.

**【CFO Financial Commentary】
- **Cash Flow Management**: $31M Q2 cash flow from operations, $57M YTD, with $333M ending cash and $13M capex.
- **Tax Strategy**: 26.5% effective tax rate vs. 21% statutory rate.
- **Shareholder Returns**: $18M returned via dividends and buybacks.
- **Q3 Guidance**: Sales $515-535M, operating margin 7-8%, EPS $0.01-0.03.

**【Q&A Highlights】**
- **Design Sales Growth**: 30% of revenue from in-home design, 5% avg ticket increase.
- **Supply Chain Restructuring**: 50-60bps productivity gains post-2025Q1 closure of leased facilities.
- **Industry Dynamics**: Proactive M&A with 6 Midwest store agreements, 50% retail ownership.
- **Tax Allocation**: 50% of cash flow reinvested in business, 50% returns to shareholders.


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