Financial Data and Key Metrics Changes - Total net sales for Q3 2023 were $134.8 million, an increase of 15.5% compared to the prior year period [16][59] - Adjusted EBITDA loss was $8.4 million, which was better than expectations, driven by better-than-planned gross margin declines [16][75] - Net loss for the quarter was $8.4 million or $0.55 per diluted share, compared to net income of $2.8 million or $0.17 per diluted share in the prior year period [73] Business Line Data and Key Metrics Changes - Showroom net sales increased by $13.3 million or 19% to $83 million, driven by higher point of sales transactions and the addition of new showrooms [60] - Other net sales, including pop-up shops and shop-in-shop transactions, increased by $7.1 million or 61.8% to $18.5 million [61] - Internet net sales decreased by $2.2 million or 6.3% to $33.3 million, reflecting a shift back to in-person shopping [63] Market Data and Key Metrics Changes - The overall furniture category is down in the mid-teens percentage-wise compared to last year, highlighting the company's outperformance [9][17] - The company reported a 38% of recent customers did not cross-shop with competitors, indicating strong brand loyalty [18] Company Strategy and Development Direction - The company aims to capitalize on a $46.2 billion total addressable market for couches and home audio, with a focus on innovation and sustainability [15][32] - The company is investing in technology and supply chain improvements to support long-term growth [20][56] - The company plans to continue expanding its showroom presence and enhancing its omnichannel experience [45][47] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro environment remains challenging, but they expect to outperform the category and generate growth at a more modest rate compared to the previous year [26][27] - The company anticipates benefits from lower inbound freight costs flowing through to the P&L, with the greatest impact expected in fiscal 2024 [83][84] - Management expressed confidence in their positioning for the holiday season and the overall outlook for the fourth quarter [86] Other Important Information - The company is committed to sustainability, having repurposed over 159 million plastic bottles into their products and aiming for zero waste and zero emissions by 2040 [31][32] - The company has a strong debt-free balance sheet and expects to end the fiscal year with over $75 million in total liquidity [11][80] Q&A Session Summary Question: Consumer sentiment and impact of higher interest rates - Management noted that while the category is down, they continue to outperform and see a strong pipeline for the holiday season, with affluent core consumers [88][90] Question: Promotional efforts relative to competitors - Management indicated that their promotions are less deep than competitors due to strong brand strength, and they are confident in their marketing investments [96][97] Question: Role of China in supply chain - Management highlighted efforts to diversify supply chains, reducing reliance on China from nearly 100% to below 30%, and focusing on sustainable manufacturing closer to consumers [104][106] Question: Planned use of higher gross profits - Management plans to use some gross margin expansion to mitigate higher outbound freight costs while also investing back into the business [110][112]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION 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 | (I.R.S. Employer | | incorporation or organization) | Identification No.) | | Two Landmark Square, Suite 300 | | | Stamford, Connecticut | 06901 | | (Address of principal executive offices) | (Zip Code) | Washington, D.C. 2054 ...

Financial Data and Key Metrics Changes - Total sales increased to $148.5 million, up 45% year-over-year, with comparable sales growth of 31% driven by both new and existing customers [11][57] - Adjusted EBITDA grew to $14.1 million from $12.4 million in the prior-year period, despite supply chain-driven gross margin pressure [12][75] - Net income was $7.1 million or $0.45 per diluted share, compared to $8.4 million or $0.52 per diluted share in the prior-year period [73] Business Line Data and Key Metrics Changes - Sactional net sales increased by 53.1%, while other category net sales, including decorative pillows and blankets, increased by 35.6% [63] - Internet net sales rose by $6.1 million or 20.5% to $35.5 million, driven by strong promotional campaigns [59] - Showroom net sales increased by $29.8 million or 47.7%, with a comparable sales increase of 36.8% [57] Market Data and Key Metrics Changes - The home category is experiencing a year-on-year decline in double digits, while Lovesac is gaining market share in a fragmented $46.2 billion market [13][20] - The company has achieved 17 consecutive quarters of over 25% growth, representing a CAGR of 45.4% over the past four years [31] Company Strategy and Development Direction - The company focuses on sustainability and a "Designed for Life" business model, which emphasizes long-term product and service relationships with customers [90][28] - Investments in high ROI marketing and advertising are key contributors to brand awareness and sales success [12][53] - The company plans to open more than 25 showrooms and continue infrastructure investments to support multi-year growth opportunities [80] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to continue gaining market share despite a challenging macro environment [25][87] - The company anticipates a moderation in sales growth rates in Q3 due to increased throughput and accelerated inventory transactions [82][100] - Management highlighted the importance of disciplined execution and infrastructure investments to support future growth [52][85] Other Important Information - The gross margin rate decreased by 310 basis points year-over-year, primarily due to increased freight costs, but was partially offset by improved product margins [65][66] - The company ended the quarter with $17.7 million in cash and cash equivalents and $36 million available on a revolving line of credit [78] Q&A Session Summary Question: What does "Designed for Life" mean at Lovesac and why is it a competitive differentiator? - "Designed for Life" is the company's design strategy focused on developing long-term products and services, which sets it apart from competitors that produce temporary products [90] Question: How much revenue could be generated from StealthTech at maturity and how does its gross margin compare against Sactionals? - The company expects to generate hundreds of millions in sales from StealthTech in the coming years, viewing it as a significant product line [92] Question: Can you provide more color on the softness at the low end of the business? - Management noted that initial concerns about softness were alleviated as the quarter progressed, with strong performance during promotional periods [96][98] Question: Is the Q3 guidance consistent with current trends? - Management indicated that Q3 performance is on track with guidance, with a strong outlook based on current sales trends [100] Question: What are the costs and timeframe for the new distribution center? - The new distribution center is expected to enhance inventory handling and customer service, with significant investments being made this year to support future growth [104][107]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q | Delaware | 32-0514958 | | --- | --- | | (State or other jurisdiction of | (I.R.S. Employer | | incorporation or organization) | Identification No.) | | Two Landmark Square, Suite 300 | | | Stamford, Connecticut | 06901 | | (Address of principal executive offices) | (Zip Code) | Registrant's telephone number, including area code: (888) 636-1223 Not applicable ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d ...

The Lovesac Company (NASDAQ:LOVE) Q1 2023 Earnings Conference Call June 8, 2022 8:30 AM ET Company Participants Rachel Schacter - ICR, IR Shawn Nelson - CEO Mary Fox - President and COO Donna Dellomo - CFO Jack Krause - Chief Strategy Officer Conference Call Participants Thomas Forte - D.A. Davidson Maria Ripps - Canaccord Brian Nagel - Oppenheimer Camilo Lyon - BTIG Matt Koranda - ROTH Capital Alex Fuhrman - Craig-Hallum Capital Group Operator Greetings. Welcome to Lovesac First Quarter Fiscal 2023 Earning ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended January 30, 2022 or o 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) | Title of each class ...

The Lovesac Company (NASDAQ:LOVE) Q4 2022 Earnings Conference Call March 29, 2022 5:00 PM ET Company Participants Rachel Schacter - ICR, IR Shawn Nelson - CEO Mary Fox - President and COO Donna Dellomo - CFO Jack Krause - Chief Strategy Officer Conference Call Participants Thomas Forte - D.A. Davidson Maria Ripps - Canaccord Brian Nagel - Oppenheimer Camilo Lyon - BTIG Alex Fuhrman - Craig-Hallum Capital Group Matt Koranda - ROTH Capital Lamont Williams - Stifel Operator Greetings, and welcome to The Lovesa ...

LOVESAC ICR Conference January 2022 Safe Harbor Statement This presentation by The Lovesac Company (the "Company," "we," "us," and "our") includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are subject to a number of risks, uncertainties and assumptions, and you should not rely upon forward-look ...

[PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company's financial statements for the period ended October 31, 2021, show significant growth in assets, driven by increases in merchandise inventories and operating lease right-of-use assets. Total assets grew to $292.8 million from $171.0 million at the start of the fiscal year. Net sales for the thirty-nine weeks increased by 58.1% year-over-year to $302.0 million, turning a prior-year net loss of ($7.0) million into a net income of $13.3 million. However, cash flow from operations was negative at ($15.2) million, primarily due to a significant build-up in inventory Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | Oct 31, 2021 (unaudited) (in thousands) | Jan 31, 2021 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $47,862 | $78,341 | | Merchandise inventories | $94,544 | $50,417 | | Total Current Assets | $163,621 | $143,399 | | Total Assets | $292,833 | $171,019 | | Total Current Liabilities | $81,578 | $56,324 | | Total Liabilities | $172,236 | $63,073 | | Stockholders' Equity | $120,597 | $107,946 | Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric | Thirteen Weeks Ended Oct 31, 2021 (in thousands) | Thirteen Weeks Ended Nov 1, 2020 (in thousands) | Thirty-nine Weeks Ended Oct 31, 2021 (in thousands) | Thirty-nine Weeks Ended Nov 1, 2020 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $116,678 | $74,742 | $302,041 | $191,060 | | Gross profit | $58,616 | $41,308 | $163,724 | $99,647 | | Operating income (loss) | $2,971 | $2,534 | $14,237 | ($6,884) | | Net income (loss) | $2,752 | $2,479 | $13,260 | ($6,976) | | Diluted EPS | $0.17 | $0.16 | $0.83 | ($0.48) | Condensed Consolidated Statement of Cash Flows Highlights (in thousands) | Cash Flow Activity | Thirty-nine weeks ended Oct 31, 2021 (in thousands) | Thirty-nine weeks ended Nov 1, 2020 (in thousands) | | :--- | :--- | :--- | | Net Cash (Used in) Provided by Operating Activities | ($15,179) | $6,929 | | Net Cash Used in Investing Activities | ($11,841) | ($7,168) | | Net Cash Used in Financing Activities | ($3,459) | ($614) | | **Net change in cash and cash equivalents** | **($30,479)** | **($853)** | - The company operates as a single reporting segment, with products aggregated for financial reporting purposes. Over **95%** of net sales come from a singular group of products[63](index=63&type=chunk) Net Sales by Product (in thousands) | Product | Thirteen Weeks Ended Oct 31, 2021 (in thousands) | Thirty-nine Weeks Ended Oct 31, 2021 (in thousands) | | :--- | :--- | :--- | | Sactionals | $100,374 | $263,558 | | Sacs | $14,195 | $33,053 | | Other | $2,109 | $5,430 | | **Total** | **$116,678** | **$302,041** | Net Sales by Channel (in thousands) | Channel | Thirteen Weeks Ended Oct 31, 2021 (in thousands) | Thirty-nine Weeks Ended Oct 31, 2021 (in thousands) | | :--- | :--- | :--- | | Showrooms | $69,694 | $181,274 | | Internet | $35,542 | $90,198 | | Other | $11,442 | $30,569 | | **Total** | **$116,678** | **$302,041** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the strong performance to growth across all sales channels, particularly a significant rebound in showroom sales post-COVID-19 restrictions. Net sales for the third quarter increased 56.1% YoY to $116.7 million, and for the thirty-nine weeks, they grew 58.1% to $302.0 million. Gross margin for the quarter decreased by 510 basis points to 50.2% due to higher transportation and tariff costs, though this was partially offset by lower promotional discounting. For the thirty-nine-week period, gross margin improved by 200 basis points to 54.2%. The company continues to invest in marketing and infrastructure to support growth, leading to higher operating expenses, but achieved leverage in SG&A as a percentage of sales. Cash used in operations was primarily for inventory investment to support demand and mitigate supply chain risks [Results of Operations - Thirteen weeks ended October 31, 2021 vs. November 1, 2020](index=27&type=section&id=Results%20of%20Operations%20-%20Thirteen%20weeks%20ended%20October%2031%2C%202021%20vs.%20November%201%2C%202020) - Net sales increased by **$42.0 million**, or **56.1%**, to **$116.7 million**, driven by growth across all channels. Showroom sales saw a significant increase of **67.8%** to **$69.7 million**, with comparable sales up **53.3%**. Internet sales grew **38.2%** to **$35.5 million**[103](index=103&type=chunk) - Gross margin decreased by **510 basis points** to **50.2%** from **55.3%**. This was primarily driven by a **748 basis point** increase in distribution and tariff expenses, partially offset by a **238 basis point** improvement in product margin from lower promotional discounting[104](index=104&type=chunk) - Selling, general and administrative (SG&A) expenses increased by **$12.2 million** (**46.8%**) to **$38.1 million**, mainly due to higher employment costs (**+$6.4 million**), rent (**+$2.7 million**), and infrastructure investments (**+$1.3 million**). However, as a percentage of net sales, SG&A improved, decreasing from **34.7%** to **32.6%**[105](index=105&type=chunk)[106](index=106&type=chunk) - Advertising and marketing expenses increased by **$4.8 million** (**44.3%**) to **$15.8 million** to support sales growth. As a percentage of net sales, these expenses decreased from **14.7%** to **13.6%** due to improved media performance[107](index=107&type=chunk) [Results of Operations - Thirty-nine weeks ended October 31, 2021 vs. November 1, 2020](index=29&type=section&id=Results%20of%20Operations%20-%20Thirty-nine%20weeks%20ended%20October%2031%2C%202021%20vs.%20November%201%2C%202020) - Net sales increased by **$110.9 million**, or **58.1%**, to **$302.0 million**. This was driven by a **150.0%** increase in showroom sales to **$181.3 million**, which more than offset an **11.4%** decrease in internet sales. The shift reflects customers returning to in-store shopping post-COVID-19 restrictions[111](index=111&type=chunk) - Gross margin increased by **200 basis points** to **54.2%** from **52.2%**. The improvement was driven by a **367 basis point** increase from lower promotional discounts and favorable vendor negotiations, which offset a **167 basis point** negative impact from higher distribution and tariff expenses, particularly escalating inbound container costs[112](index=112&type=chunk) - SG&A expenses increased by **$29.0 million** (**38.6%**) to **$104.2 million**, driven by higher employment costs (**+$16.3 million**), rent (**+$6.6 million**), and infrastructure investments. As a percentage of net sales, SG&A showed significant leverage, decreasing from **39.3%** to **34.5%**[114](index=114&type=chunk)[115](index=115&type=chunk) - Advertising and marketing expenses increased by **$13.2 million** (**50.2%**) to **$39.5 million**, reflecting the reinstatement of marketing spend as showrooms fully reopened. As a percentage of net sales, these expenses slightly decreased from **13.8%** to **13.1%**[116](index=116&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) - The company's primary sources of liquidity are cash from operations and its revolving line of credit. Primary cash needs include advertising, inventory, payroll, rent, and capital expenditures for showrooms and infrastructure[120](index=120&type=chunk) Cash Flow Summary (in thousands) | Activity | Thirty-nine weeks ended Oct 31, 2021 (in thousands) | Thirty-nine weeks ended Nov 1, 2020 (in thousands) | | :--- | :--- | :--- | | Net Cash (Used in) Provided by Operating Activities | $(15,179) | $6,929 | | Net Cash Used in Investing Activities | $(11,841) | $(7,168) | | Net Cash Used in Financing Activities | $(3,459) | $(614) | | **Net change in cash and cash equivalents** | **$(30,479)** | **$(853)** | - Net cash used in operating activities was **$15.2 million**, primarily due to a **$44.1 million** increase in inventory, which was a strategic investment to support sales growth and mitigate supply chain disruptions[123](index=123&type=chunk) - The company has a **$25.0 million** revolving credit facility with Wells Fargo. As of October 31, 2021, borrowing availability was **$22.5 million**, with no outstanding borrowings[129](index=129&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risk exposure is to interest rate fluctuations related to its revolving credit facility, which is tied to LIBOR. Management does not believe this risk is material and does not currently use interest rate hedging instruments. The company is also aware of the upcoming transition away from LIBOR and will pursue alternative interest rate calculations as needed - The company's main market risk is interest rate risk from its borrowing activities under the line of credit with Wells Fargo, which may bear interest at a rate tied to LIBOR[135](index=135&type=chunk) - The company acknowledges the planned discontinuation of LIBOR after 2021 and notes that its credit agreement includes provisions for alternative interest rate calculations, such as the Secured Overnight Financing Rate (SOFR)[136](index=136&type=chunk) [Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Based on an evaluation conducted by management, including the CEO and CFO, the company's disclosure controls and procedures were deemed effective as of October 31, 2021. Additionally, there were no material changes to the company's internal control over financial reporting during the third quarter - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period covered by this report[137](index=137&type=chunk) - There were no changes in internal control over financial reporting during the thirteen weeks ended October 31, 2021, that have materially affected, or are reasonably likely to materially affect, internal controls[138](index=138&type=chunk) [PART II. OTHER INFORMATION](index=34&type=section&id=Part%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is not currently a party to any legal proceedings that would be expected to have a material adverse effect on its business, financial condition, or results of operations - The company is not presently a party to any legal proceedings that would individually or in aggregate have a material adverse effect on its business, operating results, financial condition, or cash flows[141](index=141&type=chunk) [Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended January 31, 2021 - No material changes have been made to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2021[142](index=142&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is not applicable for the reporting period - This item is not applicable[143](index=143&type=chunk) [Defaults Upon Senior Securities](index=34&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable for the reporting period - This item is not applicable[144](index=144&type=chunk) [Mine Safety Disclosures](index=34&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable for the reporting period - This item is not applicable[145](index=145&type=chunk) [Other Information](index=34&type=section&id=Item%205.%20Other%20Information) There is no other information to report for this period - None[146](index=146&type=chunk) [Exhibits](index=35&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q. Key exhibits include the company's Annual Incentive Compensation Plan, Director Compensation Policy, an employment agreement with Mary Fox, an amendment to the employment agreement with Jack A. Krause, and CEO/CFO certifications as required by the Sarbanes-Oxley Act - The report includes several exhibits, such as: - 10.1: The Lovesac Company Annual Incentive Compensation Plan - 10.2: The Lovesac Company Director Compensation Policy - 10.3: Employment Agreement with Mary Fox - 31.1 & 31.2: Certifications of the CEO and CFO pursuant to Section 302 of the Sarbanes-Oxley Act - 32.1 & 32.2: Certifications of the CEO pursuant to Section 906 of the Sarbanes-Oxley Act[148](index=148&type=chunk)

The Lovesac Company (NASDAQ:LOVE) Q3 2022 Earnings Conference Call December 8, 2021 8:30 AM ET Company Participants Rachel Schacter - ICR, IR Shawn Nelson - CEO Jack Krause - Chief Strategy Officer Mary Fox - President and COO Donna Dellomo - CFO Conference Call Participants Brian Nagel - Oppenheimer Victoria James - D.A. Davidson Camilo Lyon - BTIG Maria Ripps - Canaccord Matt Koranda - ROTH Alex Fuhrman - Craig-Hallum Lamont Williams - Stifel Operator Greetings and welcome to The Lovesac Third Quarter Fis ...