Financial Data and Key Metrics Changes - The company reported strong growth in the second quarter, with a significant contribution from ticket sales despite a slight decline in traffic [32][34] - Operating margin expanded by 180 basis points year to date, with gross margin improvements also noted [37][39] Business Line Data and Key Metrics Changes - The company is focusing on evolving its ticket through price and assortment changes, indicating room for growth in this area [32] - Managed care customers are underdeveloped, with the company aiming to increase its customer count in this segment [34] Market Data and Key Metrics Changes - The consumer base is evolving, with a shift from a lower-income cash pay market to a more diverse demographic, including managed care and progressive customers [11][30] - The company has seen resilience in lower-income consumers, with some signs of acceleration in purchase cycles [4][5] Company Strategy and Development Direction - The company is pivoting its business model to better serve existing consumers by redefining value, particularly for managed care members [12][51] - Significant management changes have been made to enhance operational efficiency and adapt to market demands [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about consumer health, noting that consumers are gravitating towards higher-end products [53][54] - The company is focused on maintaining its position as a value leader while adapting to changing consumer expectations [12][51] Other Important Information - The company has implemented a remote care technology strategy to address doctor scarcity and improve patient access [19][45] - A new brand identity campaign has been launched, receiving positive initial consumer feedback [15] Q&A Session Summary Question: What are the expectations for the consumer environment in the second half? - Management is optimistic about consumer health, noting stability and increased traffic in managed care segments [53][54] Question: How is pricing affected by higher tariff costs? - The company has had minimal tariff exposure and has not seen significant consumer pushback on price increases [56][57] Question: What are the expectations for inventory growth into the second half? - The company operates a showroom-based inventory model, allowing for efficient inventory management [60] Question: What is the outlook for margins in the coming years? - Management is focused on expanding operating margins through strategic initiatives and cost control measures [39][61] Question: Will there be more market share consolidation in 2026? - Management expects consolidation to continue at a similar pace, influenced by private equity activity [63][65]

Athleisure brand Athleta shares higher today but down about 20% over the past three months and management saying on the call tariffs could significantly affect operating margins and financial outlook. Gap not alone. Other names like Best Buy, Walmart, Target also flagging trade headwinds and rising costs in the recent reports.But my next guest says some retailers are passing along prices quietly and that consumers aren't pushing back. Joining me now is Loop Capital's Anthony Chakumba. Anthony, thank you so ...

Company Overview - National Vision Holdings (NASDAQ: EYE) operates as a holding company for discount eyeglass stores, with America's Best being its most recognized brand [1] Brand Refresh - America's Best has recently undergone a brand refresh, indicating a strategic move to enhance its market presence and appeal to consumers [1] Investment Focus - The company is positioned within the retail sector, specifically targeting growth opportunities in the eyeglass market, which may present long-term investment potential [1]

Core Message - National Vision Holdings, Inc. is launching a rebranding campaign for America's Best, emphasizing the commitment to affordable and high-quality eye care for all Americans under the slogan "Every Eye Deserves Better" [2][4]. Group 1: Brand Reintroduction - The rebranding is described as a complete reinvention of America's Best, featuring a new logo and visual identity that reflects both sophistication and approachability [2]. - The new visual design incorporates elements of American heritage, including a fashionable reinterpretation of American stripes and colors, along with a nod to the brand's owl mascot [2]. Group 2: Marketing Strategy - The launch includes a film that showcases the importance of clear vision in everyday life, aiming to connect emotionally with both existing and potential customers [3][4]. - The media strategy for the campaign involves placements across major cable and streaming platforms such as Disney, Tubi, YouTube, and Google [4]. Group 3: Company Overview - National Vision Holdings, Inc. operates over 1,200 stores across 38 states and Puerto Rico, focusing on making quality eye care and eyewear more accessible [5]. - The company manages multiple retail brands, including America's Best and Eyeglass World, and offers an e-commerce platform for eye care products [5].

Group 1 - The individual investor focuses on managing personal capital accumulated over the years, utilizing a diverse range of investment strategies including fundamental, technical, and momentum investing [1] - The investor aims to leverage the strengths of various investment approaches to refine their investment process [1] - The purpose of writing on Seeking Alpha is to track the performance of investment ideas and connect with like-minded investors [1] Group 2 - There is no stock, option, or similar derivative position held by the analyst in any mentioned companies, nor are there plans to initiate such positions within the next 72 hours [2] - The article reflects the author's personal opinions and is not influenced by compensation from any company [2] - Seeking Alpha does not provide recommendations or advice regarding the suitability of investments for particular investors [3]

Core Insights - National Vision Holdings, Inc. (EYE) reported second-quarter 2025 adjusted earnings of 18 cents per share, an increase from 15 cents a year ago, surpassing the Zacks Consensus Estimate by 38.5% [1][7] - The company’s GAAP earnings from continuing operations were 11 cents per share, compared to a loss of 1 cent per share in the same quarter last year [1] - Following the earnings announcement, EYE's shares rose by 1.2% [1] Revenue Performance - Net revenues from continuing operations in the second quarter reached $486.4 million, exceeding the Zacks Consensus Estimate by 3.9% [3] - This represents a 7.7% increase from the previous year, driven by comparable store sales growth of 6.5% year over year [3] - Adjusted comparable store sales growth was reported at 5.9% [3] - The company opened eight new America's Best stores, bringing the total store count to 1,240, a 2% increase year over year [3] Margin Analysis - Gross profit for the second quarter increased by 10.8% to $286 million, with gross margin expanding by 2,166 basis points despite a 3.5% rise in the cost of revenues [4] - SG&A expenses rose by 6.8% year over year to $247.2 million [4] - The adjusted operating margin improved to 8%, an increase of 206 basis points year over year [4] Financial Position - At the end of the second quarter, National Vision had cash and cash equivalents of $48.5 million, down from $80 million at the end of the first quarter [5] - Cumulative net cash flow from operating activities was $86.5 million, compared to $75.4 million a year ago [5] Future Outlook - National Vision raised its fiscal 2025 revenue outlook to a range of $1.93 billion to $1.97 billion, up from the previous estimate of $1.92 billion to $1.95 billion [8] - The adjusted EPS estimate for fiscal 2025 is now projected to be between 62 cents and 70 cents, an increase from the previous range of 59 cents to 67 cents [8] - The 53rd week of fiscal 2025 is expected to contribute approximately $35 million to net revenues and nearly $3 million to adjusted operating income [6] Overall Assessment - National Vision achieved better-than-expected results in the second quarter, with both earnings and revenues surpassing estimates [9] - The company has recorded ten consecutive quarters of positive comparable store sales growth, supported by higher average ticket sales and strength in its managed care cohort [9] - Margin expansion during the quarter is viewed positively, alongside successful execution of transformation and cost reduction initiatives [10]

Financial Performance - National Vision reported revenue of $486.42 million for the quarter ended June 2025, reflecting a year-over-year increase of 7.7% [1] - The earnings per share (EPS) for the quarter was $0.18, up from $0.15 in the same quarter last year, indicating a positive trend in profitability [1] - The reported revenue exceeded the Zacks Consensus Estimate of $468.11 million by 3.91%, showcasing a strong performance against market expectations [1] Key Metrics - Adjusted comparable store sales growth was 5.9%, significantly higher than the two-analyst average estimate of 2.8% [4] - Net revenue from the Owned & Host segment, Eyeglass World, was $49.11 million, surpassing the average estimate of $47.15 million, although it represented a slight year-over-year decline of 0.8% [4] - Net revenue from the Owned & Host segment, America's Best, reached $416.78 million, exceeding the average estimate of $405.28 million, with a year-over-year growth of 9.2% [4] Stock Performance - Over the past month, shares of National Vision have returned -5.4%, contrasting with the Zacks S&P 500 composite's increase of 1.2% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - The company reported a net revenue increase of 7.7%, driven by adjusted comparable store sales growth of 5.9% and growth from new store sales [25][32] - Adjusted EPS increased to $0.18 per share from $0.15 per share a year ago, reflecting nearly 20% growth in adjusted EPS compared to the prior year [30][32] - Adjusted operating income was $23.8 million compared to $14.1 million in the prior year, with adjusted operating margin increasing by 180 basis points to 4.9% [29][30] Business Line Data and Key Metrics Changes - The managed care business delivered low double-digit comparable sales growth, supported by strong growth in both ticket and traffic [10][12] - The cash pay business continued to show positive comparable sales growth in the low single-digit range, driven by ticket increases [10][11] - The company opened eight new America's Best stores and closed five, ending the quarter with a total of 1,240 stores [26] Market Data and Key Metrics Changes - The company experienced a 6.6% increase in average ticket, reflecting the impact of price increases implemented in late 2024 and Q1 of this year [27] - The average plan for managed care consumers pays $130, with only 20% of frames priced over $99 at the end of last year, moving to approximately 40% this year [13][63] Company Strategy and Development Direction - The company is focused on modernizing its branding and enhancing customer experience through a new CRM platform and refreshed marketing strategies [8][20] - The strategy involves heightened segmentation, personalization, and digitization in messaging, product assortment, and consumer experience [12][19] - The company is also expanding its addressable market by targeting progressive lens wearers and customers bringing prescriptions from other providers [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's transformation initiatives and brand revitalization, which are energizing associates and driving improvements in comparable sales [22][23] - The company raised its full-year outlook, expecting revenue between $1.93 billion and $1.97 billion, with adjusted comparable sales growth of 3% to 5% [33] - Management remains cautious about the macroeconomic environment and is waiting for proof points from new initiatives before incorporating potential benefits into guidance [34][94] Other Important Information - The company successfully implemented the first phase of its new ERP focused on finance and accounting [32] - The company is making significant progress in enhancing its digital marketing and omnichannel capabilities [19][20] Q&A Session Summary Question: Can you talk about visibility in the number of new managed care plans? - Management noted that managed care growth was strong, with a mix around the 50% range, but did not provide specifics on individual plans [40] Question: Is there a line of sight on getting cash customer volumes positive? - Management indicated that the cash pay cohort is shrinking as more consumers transition to managed care, but they are focused on controlling their own destiny through marketing [42][44] Question: How much of America's Best comp growth came from price increases? - The majority of the growth was driven by price actions, with ongoing improvements in assortment contributing as well [49] Question: What is the margin outlook for the business? - Management emphasized that margin expansion is a primary focus, with actions being taken to improve operating margins [52] Question: Can you discuss the average price points for cash and managed care customers? - Managed care transactions generally have a higher average ticket than cash pay transactions, with ongoing efforts to attract higher quality frames for managed care consumers [56] Question: How is the company targeting the $75,000 to $100,000 income cohort? - The company is shifting its marketing strategy to be more targeted and personalized, moving from a one-to-many approach to a one-to-one marketing engine [70][71] Question: What are the goals for Eyeglass World in the context of the transformational strategy? - Eyeglass World has seen positive comps and is undergoing significant changes under new leadership, with a roadmap for improved results [77][80] Question: What is the strategy regarding store closures? - The company is rationalizing its store fleet based on profitability, demographics, and the ability to recruit doctors, with no significant changes expected in the pace of closures [86][88]

Financial Highlights - Net revenues for Q2 2025 reached $486.4 million, a 7.7% increase year-over-year[13, 24] - Adjusted comparable store sales growth was 5.9% in Q2 2025, driven by higher ticket prices[13, 24] - Adjusted operating income for Q2 2025 was $23.8 million[13] - Adjusted diluted earnings per share (EPS) for Q2 2025 was $0.18[13] - Year-to-date (YTD) net revenues reached $996.7 million, a 6.7% increase[16, 38] - YTD adjusted operating income was $65.1 million, a 35.7% increase compared to the same period in 2024[16, 41] - YTD adjusted diluted EPS was $0.52, compared to $0.44 in the same period of 2024[16, 39] Store Network - The company ended Q2 2025 with 1,240 stores, reflecting a 2.0% store count growth[29] - During Q2, 8 new America's Best stores were opened, and 5 America's Best stores were closed[29] Fiscal 2025 Outlook - The company updated its fiscal 2025 outlook, projecting net revenue between $1.934 billion and $1.970 billion[52] - Adjusted comparable store sales growth is expected to be between 3.0% and 5.0%[52] - Adjusted operating income is projected to be between $85 million and $95 million[52] - Adjusted diluted EPS is expected to be between $0.62 and $0.70, assuming approximately 80 million shares[52]

[Q2 2025 Financial Results Overview](index=1&type=section&id=National%20Vision%20Holdings%2C%20Inc.%20Reports%20Second%20Quarter%202025%20Financial%20Results) The CEO discusses strong performance driven by the company's transformation program and strategic initiatives [CEO Statement](index=1&type=section&id=CEO%20Statement) The CEO attributes strong performance to a transformation program and expresses confidence in future growth - Strong performance is credited to the successful execution of a transformation program, including a new lifestyle selling approach and refined assortment and pricing architecture[3](index=3&type=chunk) - The company is encouraged by customer response to enhanced product offerings and an elevated shopping experience at America's Best, aligning with the new brand promise, 'Every Eye Deserves Better'[3](index=3&type=chunk) - Future growth will be driven by modernized brand advertising, personalized marketing, merchandise mix optimization, and disciplined cost management[3](index=3&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) The company reports significant growth in revenue and profitability for both Q2 and year-to-date 2025 [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Summary) Q2 2025 saw a 7.7% net revenue increase and a 69.1% rise in Adjusted Operating Income Q2 2025 Key Financial Metrics (vs. Q2 2024) | Metric | Q2 2025 | Change vs. Q2 2024 | | :--- | :--- | :--- | | Net Revenue from continuing operations | $486.4 million | +7.7% | | Comparable Store Sales Growth | 6.5% | - | | Adjusted Comparable Store Sales Growth | 5.9% | - | | Income from continuing operations | $8.7 million | Up from -$1.0 million | | Diluted EPS from continuing operations | $0.11 | Up from -$0.01 | | Adjusted Operating Income | $23.8 million | +69.1% | | Adjusted Operating Margin | 4.9% | Up from 3.1% | | Adjusted Diluted EPS | $0.18 | Up from $0.15 | - Comparable store sales growth was driven by a **higher average ticket** and strength in the managed care cohort, though partially offset by a slight decrease in customer traffic[7](index=7&type=chunk) - The company opened **eight new America's Best stores** and closed five, ending the quarter with 1,240 stores, representing a 2.0% growth in store count[7](index=7&type=chunk) [Year-to-Date 2025 Financial Highlights](index=2&type=section&id=Year-to-Date%202025%20Summary) The first half of 2025 shows a 6.7% revenue growth and a 35.7% increase in Adjusted Operating Income YTD 2025 Key Financial Metrics (vs. YTD 2024) | Metric | YTD 2025 | Change vs. YTD 2024 | | :--- | :--- | :--- | | Net Revenue from continuing operations | $996.7 million | +6.7% | | Comparable Store Sales Growth | 5.2% | - | | Adjusted Comparable Store Sales Growth | 5.7% | - | | Income from continuing operations | $22.9 million | Up from $10.7 million | | Diluted EPS from continuing operations | $0.29 | Up from $0.14 | | Adjusted Operating Income | $65.1 million | +35.7% | | Adjusted Operating Margin | 6.5% | Up from 5.1% | | Adjusted Diluted EPS | $0.52 | Up from $0.44 | [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow%20Highlights%20as%20of%20June%2028%2C%202025) The company maintained a cash balance of $48.5 million and settled $84.8 million of convertible notes - The company's cash balance was **$48.5 million** as of June 28, 2025[10](index=10&type=chunk) - Total debt stood at **$272.4 million**, consisting of first lien term loans, revolving loans, and finance lease obligations[10](index=10&type=chunk) - On May 15, 2025, the company settled the remaining **$84.8 million** of its convertible senior notes due 2025[10](index=10&type=chunk) [Fiscal 2025 Outlook](index=2&type=section&id=Fiscal%202025%20Outlook) The company raises its full-year 2025 guidance for key metrics including revenue and earnings per share [Updated Fiscal 2025 Outlook](index=2&type=section&id=Updated%20Fiscal%202025%20Outlook) The updated guidance projects higher sales growth, net revenue, and adjusted operating income for fiscal 2025 Updated Fiscal 2025 Outlook | Metric | Prior Outlook (May 7, 2025) | Updated Outlook (Aug 6, 2025) | | :--- | :--- | :--- | | New Stores | 30-35 | ~32 | | Adjusted Comparable Store Sales Growth | 1.5% - 3.5% | 3.0% - 5.0% | | Net Revenue | $1.919B - $1.955B | $1.934B - $1.970B | | Adjusted Operating Income | $81M - $92M | $85M - $95M | | Adjusted Diluted EPS | $0.59 - $0.67 | $0.62 - $0.70 | | Capital Expenditures | $90M - $95M | $87M - $90M | - The 53rd week of fiscal 2025 is estimated to contribute approximately **$35 million** to net revenue and **$3 million** to Adjusted Operating Income[9](index=9&type=chunk) [Financial Statements](index=8&type=section&id=Financial%20Statements) This section presents the condensed consolidated balance sheets, statements of operations, and cash flows [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows total assets of $1.97 billion and total stockholders' equity of $850.6 million Condensed Consolidated Balance Sheets (in Thousands) | | As of June 28, 2025 | As of December 28, 2024 | | :--- | :--- | :--- | | **Total current assets** | **$217,701** | **$249,828** | | **Total assets** | **$1,968,352** | **$2,007,771** | | **Total current liabilities** | **$418,246** | **$468,274** | | **Total liabilities** | **$1,117,771** | **$1,191,438** | | **Total stockholders' equity** | **$850,581** | **$816,333** | [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) The company reports Q2 net revenue of $486.4 million and income from continuing operations of $8.7 million Condensed Consolidated Statements of Operations (in Thousands) | | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | | :--- | :--- | :--- | | Total net revenue | $486,423 | $451,733 | | Income from operations | $16,449 | $591 | | Income (loss) from continuing operations | $8,725 | $(1,041) | | Diluted EPS from continuing operations | $0.11 | $(0.01) | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations was $86.5 million for the first six months, with significant use for debt repayment Condensed Consolidated Statements of Cash Flows (Six Months Ended, in Thousands) | | June 28, 2025 | June 29, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $86,500 | $75,448 | | Net cash used for investing activities | $(32,924) | $(38,043) | | Net cash used for financing activities | $(78,825) | $(7,440) | | Net change in cash | $(25,249) | $29,965 | [Reconciliation of Non-GAAP to GAAP Financial Measures](index=11&type=section&id=Reconciliation%20of%20Non-GAAP%20to%20GAAP%20Financial%20Measures) This section provides detailed reconciliations of non-GAAP metrics to their closest GAAP equivalents [Reconciliation of Adjusted Operating Income and Adjusted EBITDA](index=11&type=section&id=Reconciliation%20of%20Adjusted%20Operating%20Income%20and%20Adjusted%20EBITDA) GAAP income is reconciled to Adjusted Operating Income and Adjusted EBITDA by excluding specific items Reconciliation of Adjusted Operating Income (Q2 2025, in thousands) | | Amount | | :--- | :--- | | Income from continuing operations | $8,725 | | Interest expense, net | $4,210 | | Income tax provision | $3,514 | | Stock-based compensation expense | $5,306 | | Amortization of acquisition intangibles | $169 | | ERP and CRM implementation expenses | $1,846 | | Other | $31 | | **Adjusted Operating Income** | **$23,801** | Reconciliation of Adjusted EBITDA (Q2 2025, in thousands) | | Amount | | :--- | :--- | | EBITDA from continuing operations | $38,985 | | Stock-based compensation expense | $5,306 | | ERP and CRM implementation expenses | $1,846 | | Other | $31 | | **Adjusted EBITDA** | **$46,168** | [Reconciliation of Adjusted Diluted EPS and Adjusted SG&A](index=13&type=section&id=Reconciliation%20of%20Adjusted%20Diluted%20EPS%20and%20Adjusted%20SG%26A) GAAP Diluted EPS and SG&A are adjusted for items like stock-based compensation to derive non-GAAP figures Reconciliation of Adjusted Diluted EPS (Q2 2025) | | Per Share Amount | | :--- | :--- | | Diluted EPS from continuing operations | $0.11 | | Stock-based compensation expense | $0.07 | | ERP and CRM implementation expenses | $0.02 | | Tax effects | $(0.02) | | Other adjustments | $0.00 | | **Adjusted Diluted EPS** | **$0.18** | Reconciliation of Adjusted SG&A (Q2 2025, in thousands) | | Amount | | :--- | :--- | | SG&A from continuing operations | $247,167 | | Stock-based compensation expense | $(5,306) | | ERP and CRM implementation expenses | $(1,846) | | Other | $(31) | | **Adjusted SG&A** | **$239,984** | [Reconciliation of Adjusted Comparable Store Sales Growth](index=14&type=section&id=Reconciliation%20of%20Adjusted%20Comparable%20Store%20Sales%20Growth) Total comparable store sales growth is adjusted for unearned and deferred revenue effects Comparable Store Sales Growth Reconciliation (Q2 2025) | Metric | Growth Rate | | :--- | :--- | | Total comparable store sales growth | 6.5% | | Adjustments for unearned & deferred revenue | (0.6)% | | **Adjusted Comparable Store Sales Growth** | **5.9%** | [Other Information](index=3&type=section&id=Other%20Information) This section includes details on upcoming company events and definitions of non-GAAP financial measures [Company Announcements](index=3&type=section&id=Company%20Announcements) The company announces an upcoming Investor Day and provides details for its Q2 2025 earnings conference call - An Investor and Analyst Day is scheduled for November 17, 2025, in New York[13](index=13&type=chunk) - A conference call to discuss Q2 2025 results was scheduled for August 6, 2025, at 8:30 a.m. Eastern Time[14](index=14&type=chunk) [Non-GAAP Financial Measures Definitions](index=6&type=section&id=Non-GAAP%20Financial%20Measures) The report defines non-GAAP measures used and explains their relevance for assessing core operating performance - The company uses non-GAAP measures to supplement GAAP information, believing they help investors compare operating performance on a consistent basis by excluding certain items[18](index=18&type=chunk) - Adjusted Comparable Store Sales Growth is used by management for key operating decisions as it provides timely information on the core retail metrics of transaction number and value[19](index=19&type=chunk)