love-20250504

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 4, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to


Commission File Number: 001-38555

THE LOVESAC COMPANY (Exact name of registrant as specified in its charter)


Delaware						32-0514958
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


421 Atlantic Street
Stamford, Connecticut						06901
(Address of principal executive offices)						(Zip Code)

Registrant’s telephone number, including area code: (888) 636-1223

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.00001 par value per share

LOVE

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files) ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the Registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of June 9, 2025, there were 14,549,118 shares of common stock, $0.00001 par value per share, outstanding.


		Page
PART I. FINANCIAL INFORMATION		1

Item 1.	Financial Statements	1

	Condensed Balance Sheets as of May 4, 2025 and February 2, 2025 (unaudited)	1

	Condensed Statements of Operations for the thirteen weeks ended May 4, 2025 and May 5, 2024 (unaudited)	2

	Condensed Statements of Changes in Stockholders’ Equity for the thirteen weeks ended May 4, 2025 and May 5, 2024 (unaudited)	3

	Condensed Statements of Cash Flows for the thirteen weeks ended May 4, 2025 and May 5, 2024 (unaudited)	4

	Notes to Financial Statements (unaudited)	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	22

Item 4.	Controls and Procedures	22

Part II. OTHER INFORMATION		23

Item 1.	Legal Proceedings	23

Item 1A.	Risk Factors	23

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23

Item 3.	Defaults Upon Senior Securities	23

Item 4.	Mine Safety Disclosures	23

Item 5.	Other Information	23

Item 6.	Exhibits	25


(amounts in thousands, except share and per share amounts)	May 4, 2025		February 2, 2025
Assets
Current Assets
Cash and cash equivalents	$	26,900	$	83,734
Trade accounts receivable, net	13,022		16,781
Merchandise inventories, net	124,926		124,333
Prepaid expenses	12,977		14,807
Other current assets	3,628		6,942
Total Current Assets	181,453		246,597
Property and equipment, net	85,267		77,990
Operating lease right-of-use assets	164,272		157,750
Goodwill	144		144
Intangible assets, net	1,719		1,586
Deferred tax asset	18,914		15,277
Other assets	31,971		32,906
Total Assets	$	483,740	$	532,250
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable	$	25,019	$	51,814
Accrued expenses	42,453		51,986
Payroll payable	7,137		9,501
Customer deposits	11,639		11,250
Current operating lease liabilities	22,599		22,662
Sales taxes payable	4,218		7,897
Total Current Liabilities	113,065		155,110
Operating lease liabilities, long-term	169,037		160,361
Income tax payable, long-term	424		424
Line of credit	—		—
Total Liabilities	282,526		315,895
Commitments and Contingencies (see Note 6)
Stockholders’ Equity
Preferred Stock $0.00001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of May 4, 2025 and February 2, 2025.	—		—
Common Stock $0.00001 par value, 40,000,000 shares authorized, 14,549,250 shares issued and outstanding as of May 4, 2025 and 14,786,934 shares issued and outstanding as of February 2, 2025.	—		—
Additional paid-in capital	192,267		190,510
Accumulated earnings	8,947		25,845
Stockholders' Equity	201,214		216,355
Total Liabilities and Stockholders' Equity	$	483,740	$	532,250


	Thirteen weeks ended
(amounts in thousands, except per share data and share amounts)	May 4, 2025		May 5, 2024
Net sales	$	138,373	$	132,643
Cost of merchandise sold	64,003		60,598
Gross profit	74,370		72,045
Operating expenses:
Selling, general and administrative expenses	67,117		68,403
Advertising and marketing	18,594		17,996
Depreciation and amortization	3,613		3,502
Total operating expenses	89,324		89,901
Operating loss	(14,954)		(17,856)
Interest and other income, net	325		744
Net loss before taxes	(14,629)		(17,112)
Income tax benefit	3,789		4,152
Net loss	$	(10,840)	$	(12,960)

Net loss per common share:
Basic	$	(0.73)	$	(0.83)
Diluted	$	(0.73)	$	(0.83)

Weighted average shares outstanding:
Basic	14,792,080		15,537,823
Diluted	14,792,080		15,537,823


	Thirteen weeks ended
	Common
	Shares	Amount		Additional Paid-in Capital		Accumulated Earnings (Deficit)		Total Shareholders' Equity
Balance - February 2, 2025	14,786,934	$	—	$	190,510	$	25,845	$	216,355
Net loss	—	—		—		(10,840)		(10,840)
Equity-based compensation	—	—		2,501		—		2,501
Vested restricted stock units	68,641	—		—		—		—
Repurchases of common stock	(306,325)	—		—		(6,058)		(6,058)
Taxes paid for net share settlement of equity awards	—	—		(744)		—		(744)
Balance - May 4, 2025	14,549,250	—		192,267		8,947		201,214

Balance - February 4, 2024	15,489,364	$	—	$	183,095	$	34,401	$	217,496
Net loss	—	—		—		(12,960)		(12,960)
Equity-based compensation	—	—		1,152		—		1,152
Vested restricted stock units	36,325	—		—		—		—

Taxes paid for net share settlement of equity awards	—	—		(356)		—		(356)
Balance - May 5, 2024	15,525,689	$	—	$	183,891	$	21,441	$	205,332


	Thirteen weeks ended
(amounts in thousands)	May 4, 2025		May 5, 2024
Cash Flows from Operating Activities
Net loss	$	(10,840)	$	(12,960)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization of property and equipment	3,545		3,391
Amortization of other intangible assets	68		111
Amortization of deferred financing fees	19		36
Net loss on disposal of property and equipment	21		43


Equity based compensation	2,501		1,152
Non-cash lease expense	6,684		6,104
Deferred income taxes	(3,637)		(4,185)
Change in operating assets and liabilities:
Trade accounts receivable	3,759		6,287
Merchandise inventories	(593)		3,727
Prepaid expenses and other current assets	5,137		(1,067)
Other assets	935		(1,685)
Accounts payable	(27,228)		(2,856)
Accrued expenses and other payables	(15,720)		(5,075)
Operating lease liabilities	(6,417)		(3,874)
Customer deposits	389		3,837

Net cash used in operating activities	(41,377)		(7,014)
Cash Flows from Investing Activities
Purchase of property and equipment	(8,577)		(7,296)
Payments for patents and trademarks	(124)		(8)
Net cash used in investing activities	(8,701)		(7,304)
Cash Flows from Financing Activities
Taxes paid for net share settlement of equity awards	(744)		(356)
Repurchases of common stock	(6,000)		—


Payment of deferred financing costs	(12)		—

Net cash used in financing activities	(6,756)		(356)
Net change in cash and cash equivalents	(56,834)		(14,674)
Cash and cash equivalents - Beginning	83,734		87,036
Cash and cash equivalents - Ending	$	26,900	$	72,362
Supplemental Cash Flow Data:
Cash paid for taxes	$	—	$	10
Cash paid for interest	$	40	$	30
Non-cash investing and financing activities:
Asset acquisitions not yet paid for at period end	$	519	$	2,142
Leasehold improvements acquired through lease incentive	$	1,824	$	—
Excise tax on share repurchases, accrued but not paid	$	58	$	—


	Number of shares	Weighted average grant date fair value
Unvested at February 2, 2025	1,289,002	$	24.20
Granted	649,743	19.69
Forfeited	(121,782)	32.24
Vested	(106,772)	25.97
Unvested at May 4, 2025	1,710,191	$	21.80


	Number of shares	Weighted average grant date fair value
Unvested at February 4, 2024	1,032,408	$	31.41
Granted	478,082	18.86
Forfeited	(369,098)	34.47
Vested	(56,161)	33.89
Unvested at May 5, 2024	1,085,231	$	24.71


	Thirteen weeks ended
Showroom Count:	May 4, 2025	May 5, 2024
Showrooms open at beginning of period	257	230
Showrooms opened	11	24
Showrooms closed	(1)	(8)
Showrooms open at end of period(1)	267	246
Showroom remodels	1	—


Condensed Statement of Cash flow Data:
	Thirteen weeks ended
(amounts in thousands)	May 4, 2025		May 5, 2024
Net cash used in operating activities	$	(41,377)	$	(7,014)
Net cash used in investing activities	(8,701)		(7,304)
Net cash used in financing activities	(6,756)		(356)
Net change in cash and cash equivalents	(56,834)		(14,674)
Cash and cash equivalents at the end of the period	26,900		72,362


	Total Number of Shares Purchased	Average Price Paid Per Share (1)		Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Program (2)
					(in thousands)
February 3, 2025 to March 2, 2025	—	$	—	—	$	20,084
March 3, 2025 to April 6, 2025	—	$	—	—	$	20,084
April 7, 2025 to May 4, 2025	306,325	$	19.57	306,325	$	14,090
Total	306,325			306,325


	The Lovesac Company

	By:	/s/ Shawn Nelson
		Shawn Nelson
Date: June 12, 2025		Chief Executive Officer
		(Principal Executive Officer)

	By:	/s/ Keith Siegner
		Keith Siegner
Date: June 12, 2025		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

SEC Form 10-Q filed by The Lovesac Company