Purple Innovation Earnings Call Transcripts
Fiscal Year 2026
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Q1 2026 revenue declined 8.1% year-over-year, mainly due to e-commerce softness and an accounting adjustment, but showroom comps rose 7% and wholesale grew excluding the adjustment. Gross margin was 36.8%, pressured by floor model investments, while full-year revenue guidance was lowered to $465–$485 million, with EBITDA guidance unchanged.
Fiscal Year 2025
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Q4 2025 saw 9% revenue growth and improved profitability, with full-year adjusted EBITDA turning positive. 2026 guidance calls for $500M-$520M revenue and $20M-$30M adjusted EBITDA, driven by premium products and expanded wholesale, despite a challenging market.
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Revenue returned to growth at $118.8M, with gross margin up to 42.8% and positive Adjusted EBITDA. Showroom and wholesale segments outperformed, while e-commerce improved sequentially. Full-year guidance was reiterated, and the company remains focused on innovation and retail expansion.
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Q2 revenue declined 12.6% year-over-year but improved sequentially, with strong demand for new products and expanding retail partnerships. Gross margin was temporarily impacted by tariffs and ramp-up costs, but recovery is expected by year-end. Full-year guidance is reaffirmed.
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Revenue declined 13% year-over-year to $104.2 million, but gross margin and adjusted EBITDA improved due to cost savings and showroom strength. Expanded Mattress Firm partnership is expected to add $70 million in annual revenue, offsetting tariff and macro headwinds.
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Premium sleep products business achieved Q4 profitability after cost restructuring and manufacturing consolidation, with gross margins above 40%. 2025 growth will come from new products, expanded wholesale and Costco presence, and a strong direct-to-consumer channel. Stabilized discounts and efficiencies position the company for improved cash flow and EBITDA.
Fiscal Year 2024
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Q4 2024 marked a return to adjusted EBITDA profitability and positive cash flow, driven by gross margin gains, cost savings, and operational improvements. Despite revenue declines, showroom and product innovation outperformed, and 2025 guidance anticipates margin expansion and sequential growth, with no industry recovery assumed.
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Q3 revenue declined 15% year-over-year amid industry softness, but adjusted gross margin improved to 40.5% and operational restructuring is driving significant cost savings. The company expects to finish the year at the low end of guidance and targets positive cash flow and adjusted EBITDA in 2025, supported by ongoing efficiency gains.
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Q2 saw 2% sales growth and a major gross margin improvement to 40.7%, despite a tough market. Revenue guidance for 2024 was lowered by $50 million, but Adjusted EBITDA guidance was reaffirmed, with profitability expected in Q4. Operational efficiencies and showroom performance drove results.
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Demand in the mattress sector remains soft, but new premium products and expanded marketing are driving above-market growth and improved margins. Omni-channel expansion, especially in stores and wholesale, is supporting brand reach, while manufacturing capacity and liquidity position the company for sustained profitability in the second half of the year.