Tandy Leather 2025 Q3 Earnings Net Loss Widens 924% as Revenue Declines Slightly

Tandy Leather (TLF) reported mixed results for Q3 2025, with revenue declining 0.5% year-over-year to $17.26 million and a net loss widening to $1.35 million. The company maintained qualitative guidance for a "solid" fourth quarter but provided no specific financial targets.

Revenue

Tandy Leather’s total revenue decreased marginally to $17.26 million in Q3 2025, a 0.5% decline from $17.35 million in the prior-year period. The company attributed the softness to temporary disruptions in online order fulfillment during its headquarters and distribution center relocation.

Earnings/Net Income

The company’s net loss expanded sharply to $1.35 million in Q3 2025, a 924.2% increase from a $132,000 loss in 2024 Q3. Earnings per share (EPS) turned to a $0.17 loss, compared to a $0.02 loss a year earlier. The widening loss reflects elevated operating expenses and challenges from the relocation, though gross margins improved to 58.9% from 57.8%.

Price Action

Post-earnings, TLF shares edged up 0.05% in the latest trading day but fell 1.85% over the past week and 1.20% month-to-date. Historically, buying TLF shares on revenue raise announcement days and holding for 30 days has yielded an average annual return of 12.5% over the past three years. This strategy capitalizes on investor optimism on announcement days, with gains consolidating over subsequent weeks as markets digest the news. The consistent performance suggests TLF’s revenue raises are generally well-received by investors, though the recent Q3 results highlight operational headwinds.

CEO Commentary

Johan Hedberg, CEO, emphasized the successful completion of the headquarters and distribution center relocation, stating the company is “well positioned for a solid fourth quarter in both retail and online channels.” He noted year-to-date sales growth and stronger retail store performance despite temporary online fulfillment challenges.

Guidance

The company expects a “solid” fourth quarter but did not provide quantitative guidance. Forward-looking risks include economic conditions, consumer spending, and supply chain uncertainties.

Additional News

1. HQ Relocation & Lease: Tandy Leather finalized the sale of its Fort Worth headquarters in January 2025 for $26.5 million, with proceeds funding a $1.50-per-share special dividend. The company now leases its current space until September 2025 while securing new facilities.

2. Leadership Changes: Johan Hedberg was appointed CEO in January 2025, succeeding Janet Carr, who transitioned to an advisory role. Hedberg brings 30+ years of retail and wholesale experience, most recently as Fiskars Group’s Chief Sales Officer.

3. Dividend & Cash Position: The special dividend of $1.50 per share, payable in February 2025, was funded by the headquarters sale. As of Q3 2025, TLF held $12.0 million in cash, up from $10.0 million a year earlier.