love-20250803

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 August 3, 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 September 8, 2025, there were 14,610,309 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 August 3 , 2025 and February 2, 2025 (unaudited)	1

	Condensed Statements of Operations for the thirteen and twenty-six weeks ended August 3 , 2025 and August 4 , 2024 (unaudited)	2

	Condensed Statements of Changes in Stockholders’ Equity for the thirteen and twenty-six weeks ended August 3, 2025 and August 4, 2024 (unaudited)	3

	Condensed Statements of Cash Flows for the twenty-six weeks ended August 3 , 2025 and August 4 , 2024 (unaudited)	4

	Notes to Financial Statements (unaudited)	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	24

Item 4.	Controls and Procedures	25

Part II. OTHER INFORMATION		26

Item 1.	Legal Proceedings	26

Item 1A.	Risk Factors	26

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26

Item 3.	Defaults Upon Senior Securities	26

Item 4.	Mine Safety Disclosures	26

Item 5.	Other Information	26

Item 6.	Exhibits	27


(amounts in thousands, except share and per share amounts)	August 3, 2025		February 2, 2025
Assets
Current Assets
Cash and cash equivalents	$	34,191	$	83,734
Trade accounts receivable, net	14,072		16,781
Merchandise inventories, net	123,983		124,333
Prepaid expenses	14,273		14,807
Other current assets	3,318		6,942
Total Current Assets	189,837		246,597
Property and equipment, net	84,441		77,990
Operating lease right-of-use assets	165,433		157,750
Goodwill	144		144
Intangible assets, net	1,862		1,586
Deferred tax asset	21,256		15,277
Other assets	30,736		32,906
Total Assets	$	493,709	$	532,250
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable	$	35,996	$	51,814
Accrued expenses	36,490		51,986
Payroll payable	11,438		9,501
Customer deposits	13,553		11,250
Current operating lease liabilities	22,785		22,662
Sales taxes payable	4,881		7,897
Total Current Liabilities	125,143		155,110
Operating lease liabilities, long-term	170,681		160,361
Income tax payable, long-term	424		424
Line of credit	—		—
Total Liabilities	296,248		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 August 3, 2025 and February 2, 2025.	—		—
Common Stock $0.00001 par value, 40,000,000 shares authorized, 14,599,825 shares issued and outstanding as of August 3, 2025 and 14,786,934 shares issued and outstanding as of February 2, 2025.	—		—
Additional paid-in capital	195,154		190,510
Accumulated earnings	2,307		25,845
Stockholders' Equity	197,461		216,355
Total Liabilities and Stockholders' Equity	$	493,709	$	532,250


	Thirteen weeks ended				Twenty-six weeks ended
(amounts in thousands, except per share data and share amounts)	August 3, 2025		August 4, 2024		August 3, 2025		August 4, 2024
Net sales	$	160,530	$	156,590	$	298,903	$	289,233
Cost of merchandise sold	69,922		64,221		133,925		124,819
Gross profit	90,608		92,369		164,978		164,414
Operating expenses:
Selling, general and administrative expenses	72,114		73,674		139,231		142,077
Advertising and marketing	23,481		23,310		42,075		41,306
Depreciation and amortization	3,836		3,756		7,449		7,258
Total operating expenses	99,431		100,740		188,755		190,641
Operating loss	(8,823)		(8,371)		(23,777)		(26,227)
Interest and other income, net	100		694		425		1,438
Net loss before taxes	(8,723)		(7,677)		(23,352)		(24,789)
Income tax benefit	2,073		1,816		5,862		5,968
Net loss	$	(6,650)	$	(5,861)	$	(17,490)	$	(18,821)

Net loss per common share:
Basic	$	(0.45)	$	(0.38)	$	(1.19)	$	(1.21)
Diluted	$	(0.45)	$	(0.38)	$	(1.19)	$	(1.21)

Weighted average shares outstanding:
Basic	14,623,823		15,590,207		14,707,952		15,564,016
Diluted	14,623,823		15,590,207		14,707,952		15,564,016


	Thirteen weeks ended
	Common
	Shares	Amount		Additional Paid-in Capital		Accumulated Earnings (Deficit)		Total Shareholders' Equity
Balance - May 4, 2025	14,549,250	$	—	$	192,267	$	8,947	$	201,214
Net loss	—	—		—		(6,650)		(6,650)
Equity-based compensation	—	—		3,266		—		3,266
Vested restricted stock units	50,575	—		—		—		—
Repurchases of common stock	—	—		—		10		10
Taxes paid for net share settlement of equity awards	—	—		(379)		—		(379)
Balance - August 3, 2025	14,599,825	—		195,154		2,307		197,461

Balance - May 5, 2024	15,525,689	$	—	$	183,891	$	21,441	$	205,332
Net loss	—	—		—		(5,861)		(5,861)
Equity-based compensation	—	—		2,752		—		2,752
Vested restricted stock units	32,993	—		—		—		—

Taxes paid for net share settlement of equity awards	—	—		(81)		—		(81)
Balance - August 4, 2024	15,558,682	$	—	$	186,562	$	15,580	$	202,142


	Twenty-six weeks ended
(amounts in thousands)	August 3, 2025		August 4, 2024
Cash Flows from Operating Activities
Net loss	$	(17,490)	$	(18,821)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization of property and equipment	7,306		7,038
Amortization of other intangible assets	143		220
Amortization of deferred financing fees	37		97
Net loss on disposal of property and equipment	34		62

Impairment of long-lived assets	1,541		—
Equity based compensation	5,767		3,904
Non-cash lease expense	13,374		12,355
Deferred income taxes	(5,979)		(6,082)
Change in operating assets and liabilities:
Trade accounts receivable	2,709		(1,324)
Merchandise inventories	350		10,153
Prepaid expenses and other current assets	4,133		(3,406)
Other assets	2,170		(3,652)
Accounts payable	(16,742)		(543)
Accrued expenses and other payables	(16,430)		846
Operating lease liabilities	(12,438)		(8,718)
Customer deposits	2,303		7,040

Net cash used in operating activities	(29,212)		(831)
Cash Flows from Investing Activities
Purchase of property and equipment	(12,910)		(13,360)
Payments for patents and trademarks	(286)		(142)
Net cash used in investing activities	(13,196)		(13,502)
Cash Flows from Financing Activities
Taxes paid for net share settlement of equity awards	(1,123)		(437)
Repurchases of common stock	(6,000)		—


Payment of deferred financing costs	(12)		(140)

Net cash used in financing activities	(7,135)		(577)
Net change in cash and cash equivalents	(49,543)		(14,910)
Cash and cash equivalents - Beginning	83,734		87,036
Cash and cash equivalents - Ending	$	34,191	$	72,126
Supplemental Cash Flow Data:
Cash paid for taxes	$	9,077	$	8,354
Cash paid for interest	$	71	$	61
Non-cash investing and financing activities:
Asset acquisitions not yet paid for at period end	$	731	$	589
Leasehold improvements acquired through lease incentive	$	1,824	$	—
Excise tax on share repurchases, accrued but not paid	$	48	$	—


	Number of shares	Weighted average grant date fair value
Unvested at February 2, 2025	960,055	$	23.94
Granted	330,314	19.87
Forfeited	(132,570)	31.94
Vested	(29,646)	21.27
Unvested at August 3, 2025	1,128,153	$	21.88


	Number of shares	Weighted average grant date fair value
Unvested at February 4, 2024	812,822	$	31.01
Granted	602,637	21.24
Forfeited	(431,779)	33.58

Unvested at August 4, 2024	983,680	$	23.89


	Number of shares	Weighted average grant date fair value
Unvested at Unvested at February 2, 2025	328,947	$	24.96
Granted	357,277	19.64
Forfeited	(13,160)	22.83
Vested	(155,176)	26.32
Unvested at Unvested at August 3, 2025	517,888	$	20.94


	Number of shares	Weighted average grant date fair value
Unvested at Unvested at February 4, 2024	219,586	$	32.91
Granted	233,693	21.73
Forfeited	(14,413)	27.68
Vested	(97,455)	33.83
Unvested at Unvested at August 4, 2024	341,411	$	25.22

SEC Form 10-Q filed by The Lovesac Company