Purple Innovation Stock Plunges 11.11% as Q3 Earnings Miss and Mattress Market Softness Weigh

The share price fell to its lowest level since July 2025 today, with an intraday decline of 11.11%.

Purple Innovation’s stock slump reflects investor disappointment over its Q3 2025 earnings report, despite a narrowed net loss and positive adjusted EBITDA. The company reported revenue of $118.8 million, missing estimates by $4.44 million, while non-GAAP earnings of -$0.08 per share beat forecasts. A 10% drop in e-commerce revenue, coupled with industry-wide softness in the mattress market, underscored persistent challenges. However, a 700-basis-point sequential gross margin improvement to 42.8% and a $200,000 adjusted EBITDA turnaround highlighted operational progress.

Strategic initiatives, including the successful launch of the Rejuvenate 2.0 mattress and an expanded partnership with Mattress Firm, offered partial optimism. The latter added 9,200 retail slots in Q3, with projections of 12,000 by early 2026. Cost-cutting measures, which reduced annual fixed costs by $25–30 million, supported liquidity improvements, with cash reserves rising to $32.4 million. Yet, lingering risks—such as Q4 margin compression from promotional activity and macroeconomic headwinds—weighed on sentiment. Analysts remain cautious, assigning a “Hold” rating amid mixed earnings revisions and a challenging industry backdrop.