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- **Revenue Growth**: 5.9% YoY increase, driven by retail sales and new product lines.
- **Gross Margin Expansion**: 320 basis points improvement to 56.2%, supported by cost control and pricing strategies.
- **Tariff Management**: Implementing surcharges and exploring integrated pricing to mitigate 20-50% tariffs on imports.
- **Operational Efficiency**: 590 basis point reduction in SG&A expenses, with strong Q4 cash flow potential.
- **New Product Momentum**: Custom Studio orders up 35%, outdoor sales +18%, and Copenhagen collection performing well.

**【Management Opening Remarks】**
- Earnings release for Q3 2025 was issued on October 8, 2025, with a transcript available on the investor website.
- Forward-looking statements are subject to risks, including those outlined in the 10-K filing.

**【CEO Commentary】**
- **Revenue Growth**: Consolidated revenue increased 5.9% YoY ($4.5 million), driven by a 9.8% rise in company-owned retail sales and 1% growth in open market wholesale sales.
- **Gross Margin Improvement**: Improved 320 basis points to 56.2%, due to better wholesale margins and cost optimization.
- **Tariff Impact**: Implemented surcharges on imported goods from Vietnam (20%) and India (50%), with plans to integrate tariffs into product pricing.
- **New Product Success**: Custom Studio orders up 35%, Copenhagen and Newbury collections performed well, and outdoor sales grew 18%.
- **Cost Control**: Reduced SG&A expenses by 590 basis points as a percentage of sales, driven by operational efficiency and fixed cost leverage.

**【CFO Financial Commentary】**
- **Financial Highlights**: 
  - Operating income of $600,000 (0.7% of sales) vs. -$6.4 million YoY.
  - Diluted EPS of $0.09 vs. -$0.52 YoY.
  - Liquidity remains strong at $52.6 million in cash, with no debt.
- **Wholesale Performance**: Shipments to retail stores up 9.2%, with 9.6% growth in Lane Venture shipments.
- **Retail Efficiency**: Conversion rates improved 18%, offsetting website traffic decline.
- **Capital Allocation**: $1.7 million in dividends and $400,000 in share buybacks, with 2026 capex reduced to $5-7 million.

**【Q&A Highlights】**
- **Sales Trends**: August was the strongest month, with Labor Day sales momentum continuing into September.
- **Tariff Strategy**: Considering rolling tariffs into product prices to simplify surcharges.
- **Gross Margin Outlook**: 55-56% range expected, with cautious optimism for slight improvements.
- **Market Share**: Domestic manufacturing (80% of shipments) may provide competitive advantage.
- **Cash Flow**: Q4 typically strong for cash generation, with hopes to cover dividend in future quarters.

Bassett Furniture Industries (BSET)-9 Oct 25-2025 Q3 Earnings call transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

BSET

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