Company Performance - La-Z-Boy reported quarterly earnings of $0.47 per share, missing the Zacks Consensus Estimate of $0.53 per share, and down from $0.62 per share a year ago, representing an earnings surprise of -11.32% [1] - The company posted revenues of $492.23 million for the quarter ended July 2025, surpassing the Zacks Consensus Estimate by 0.39%, but down from $495.53 million year-over-year [2] - Over the last four quarters, La-Z-Boy has surpassed consensus EPS estimates two times and topped consensus revenue estimates four times [2] Market Performance - La-Z-Boy shares have lost about 12% since the beginning of the year, while the S&P 500 has gained 9.7% [3] - The current consensus EPS estimate for the upcoming quarter is $0.72 on revenues of $533.1 million, and for the current fiscal year, it is $3.17 on revenues of $2.16 billion [7] Industry Outlook - The furniture industry, to which La-Z-Boy belongs, is currently in the bottom 9% of the Zacks industry rankings, indicating potential challenges ahead [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact La-Z-Boy's stock performance [5][6]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 26, 2025 or ☐ 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 1-9656 LA-Z-BOY INCORPORATED (Exact name of registrant as specified in its charter) | Michigan | | 38 ...

EXHIBIT 99.1 La-Z-Boy Incorporated Reports First Quarter Results; Led By Retail And Wholesale Delivered Sales Growth And Wholesale Margin Expansion; Retail Written Sales Up 5% Fiscal 2026 First Quarter Highlights: MONROE, Mich., August 19, 2025 -- La-Z-Boy Incorporated (NYSE: LZB), a global leader in the retail and manufacture of residential furniture, today reported first quarter results for the period ended July 26, 2025. For the quarter, sales totaled $492 million, down 1% against the prior year comparab ...

Core Insights - La-Z-Boy Incorporated reported a 1% decrease in sales for the first quarter of fiscal 2026, totaling $492 million, with growth in Retail and Wholesale segments offset by a decline in Joybird sales [2][12] - The company achieved an operating margin of 4.5% on a GAAP basis and 4.8% on an adjusted basis, reflecting challenges in consumer demand and investments in new stores [2][12] - Diluted earnings per share were $0.44 on a GAAP basis and $0.47 on an adjusted basis, both lower than the previous year [2][12] Financial Performance - Retail segment written sales increased by 5%, while same-store sales decreased by 4%, indicating a challenging consumer environment [3][17] - Wholesale segment delivered sales increased by 1%, driven by the core North America La-Z-Boy wholesale business [4][7] - The company returned $22 million to shareholders during the quarter, including $13 million in share repurchases and $9 million in dividends [2][17] Strategic Developments - La-Z-Boy announced the acquisition of a 15-store network in the Southeast region, expected to close in late October [4][7] - The company was recognized by Newsweek as one of America's Best Retailers in 2025, ranking 1 in the furniture category [5] - The company is actively adjusting operations to navigate the current environment while continuing to invest in its Century Vision strategy for long-term growth [4][5] Outlook - For the second quarter, La-Z-Boy expects sales to be in the range of $510-530 million, with an adjusted operating margin of 4.5-6.0% [6][7] - The company is balancing optimism about long-term industry fundamentals with a pragmatic approach to current consumer demand [5][6] Cash Flow and Liquidity - The company generated $36 million in operating cash flow for the quarter and ended with $319 million in cash and no external debt [7][17] - Free cash flow for the quarter was $17.8 million, down from $36.7 million in the prior year [9][17] Segment Analysis - Retail segment delivered sales increased by 2% to $207 million, driven by new and acquired stores [17] - Joybird sales decreased significantly, with written sales down 14% and delivered sales down 20% to $28 million [12][17] - The Wholesale segment's sales increased to $353 million, supported by growth in the core North America business [12][37]

Core Viewpoint - La-Z-Boy Incorporated is set to report its Fiscal 2026 First Quarter results on August 19, 2025, with a subsequent investor conference call scheduled for August 20, 2025 [1]. Company Overview - La-Z-Boy Incorporated is a vertically integrated furniture retailer and manufacturer, known for its iconic recliner invented in 1927, and is committed to quality and consumer compassion [4]. - The company operates over 200 company-owned La-Z-Boy Furniture Galleries stores and is part of a network of nearly 370 stores nationwide, complemented by its online presence [5]. Retail and Wholesale Segments - The Retail segment includes La-Z-Boy Furniture Galleries and Joybird, an e-commerce retailer with 13 stores in the U.S. [5]. - In the Wholesale segment, La-Z-Boy manufactures custom furniture for various retail channels, including England Furniture Co. and casegoods brands like Kincaid, American Drew, and Hammary [5].

Core Insights - La-Z-Boy Incorporated has signed an asset purchase agreement to acquire a La-Z-Boy Furniture Galleries store network in the southeast U.S. from Atlanta Furniture Galleries, LLC, which includes 15 stores and approximately $80 million in annual sales [2][3] Acquisition Details - The acquisition will enhance La-Z-Boy's presence in the southeast region, adding 15 stores to its Retail segment and increasing the total company-owned store count to 220, representing 60% of the entire La-Z-Boy Furniture Galleries network [3] - The transaction is expected to close in late October 2025, subject to customary closing conditions [3] - The acquisition is anticipated to contribute approximately $40 million in additional annual sales to La-Z-Boy on a consolidated basis [4] Strategic Importance - The stores are located in key markets such as Atlanta, Orlando, Jacksonville, and Knoxville, which are considered core markets for La-Z-Boy, facilitating further growth opportunities [4] - This acquisition is noted as the largest independently owned La-Z-Boy Furniture Galleries acquisition in the company's history [5] Financial Outlook - La-Z-Boy expects its fiscal first quarter sales and adjusted operating margin to be around the low end of previously issued outlook ranges due to challenging consumer and macroeconomic conditions [5][6]

Financial Data and Key Metrics Changes - Consolidated delivered sales for Q4 reached $571 million, a 3% increase year-over-year [6][21] - For the fiscal year, consolidated delivered sales totaled $2.1 billion, also growing 3% compared to the previous year [8][25] - Operating cash flow for the year was $187 million, up 18% from the prior year [8][28] - The company maintained a strong balance sheet with $328 million in cash and no external debt [8][27] Business Line Data and Key Metrics Changes - Retail segment sales grew 8% in Q4, driven by new stores and acquisitions [6][22] - For the fiscal year, retail segment sales increased by 5% [8][25] - Wholesale segment sales grew 2% in Q4, led by the North American business [7][23] - Joybird's written sales decreased by 21% in Q4, reflecting challenges in the online business [14][24] Market Data and Key Metrics Changes - Written same-store sales for the retail segment decreased by 5% year-over-year in Q4 [13] - Industry data showed mixed results, with some peers reporting flat to mid-teen declines in same-store sales [13] - The company noted that high mortgage rates and economic volatility negatively impacted consumer sentiment [13] Company Strategy and Development Direction - The company is focused on its Century Vision strategy, aiming for double-digit operating margins and sales growth at double the market rate [15][19] - Plans to expand the total network of La Z Boy Furniture Galleries to over 400 stores, with a focus on company-owned locations [16][17] - The company is investing in redesigning its distribution network to enhance efficiency and improve consumer delivery experiences [10][11] Management's Comments on Operating Environment and Future Outlook - Management expects continued global economic uncertainty to challenge consumers in the near term but remains confident in the business model [9][20] - The company anticipates a rebound in housing fundamentals, which could benefit the industry long-term [20] - Management highlighted the importance of agility in navigating external challenges and maintaining strong execution [12][33] Other Important Information - The company was recognized in Newsweek's list of America's most loved brands and most trustworthy companies for 2025 [33] - The company returned $113 million to shareholders through dividends and share repurchases, including a 10% dividend increase for the fourth consecutive year [8][28] Q&A Session Summary Question: Potential for wholesale segment margin expansion - Management indicated that achieving a 10% margin requires both internal improvements and a healthy industry environment [39][40] Question: Timing of the distribution redesign project - Management explained that the decision was driven by recent acquisitions and the need for efficiency in the growing business [42][43] Question: Recent written orders trends - Management noted that Memorial Day showed a solid start, contrasting with a challenging February [44][45] Question: Reasons for sales outperformance relative to guidance - Management attributed the outperformance to broad-based execution despite macroeconomic challenges [51][52] Question: Impact of tariffs and pricing strategy - Management discussed the nominal pricing actions taken and the agility in responding to tariff impacts [53][55] Question: Long-term growth for Joybird - Management remains optimistic about Joybird's growth potential while emphasizing prudent expansion [57][60] Question: La Z Boy's pricing strategy in the current environment - Management expressed confidence in their competitive positioning and the ability to manage pricing effectively [64][67] Question: Operating margin outlook for the fiscal year - Management stated that margin expansion is contingent on industry health and their ability to outperform [70][71]

Financial Data and Key Metrics Changes - Consolidated delivered sales for Q4 2025 were $571 million, growing 3% year-over-year [6][7] - For the fiscal year, consolidated delivered sales reached $2.1 billion, also growing 3% compared to the previous year [7][27] - Operating cash flow for the year was $187 million, up 18% from the prior year [7][30] - The company maintained a strong balance sheet with $328 million in cash and no external debt [7][30] - Adjusted diluted EPS for the year was $2.92, down from $2.98 in fiscal 2024 [27][29] Business Segment Data and Key Metrics Changes - Retail segment sales for Q4 increased 8% to $247 million, driven by new stores and acquisitions [24] - Wholesale segment sales grew 2% to $324 million in Q4, primarily from the North American business [25] - Joybird's delivered sales were $36 million, down 2% year-over-year, with a positive adjusted operating margin [26] Market Data and Key Metrics Changes - Written same-store sales for the retail segment decreased 5% year-over-year, influenced by high mortgage rates and economic volatility [13] - Industry data showed mixed results, with some peers reporting flat to mid-teen declines in same-store sales [13] - Joybird's written sales trends decreased 21% in the quarter, with stronger performance in physical stores compared to online [14][15] Company Strategy and Development Direction - The company is focused on its Century Vision strategy, aiming for double-digit growth and operating margins [16][22] - Plans to expand the La-Z-Boy Furniture Galleries network to over 400 stores, with a focus on company-owned locations [17][18] - The company is investing in its supply chain and distribution network to enhance efficiency and service levels [10][11][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business model to outperform peers despite ongoing economic challenges [9][22] - The company anticipates continued macroeconomic volatility but expects to benefit from a rebound in the housing market in the long term [22][35] - Management highlighted the importance of agility in navigating external uncertainties and maintaining consumer engagement [12][22] Other Important Information - The company was recognized in Newsweek's list of America's most loved brands and most trustworthy companies for 2025 [35] - The company plans to open approximately 15 new company-owned and independent stores in fiscal 2026 [32][33] Q&A Session Summary Question: Can you provide details on the drivers for margin expansion in the wholesale segment? - Management indicated that half of the margin improvement is within their control through distribution redesign, while the other half depends on a healthy industry and housing market [40][42] Question: Why is the distribution redesign project being initiated now? - The timing is due to the increased scale of the business and the opportunity for efficiency improvements [44][45] Question: What has been observed in written orders recently? - Management noted that Memorial Day showed a solid start, contrasting with a challenging February [46][47] Question: What were the reasons for sales outperformance compared to guidance? - The outperformance was attributed to broad-based execution despite macroeconomic challenges [52][54] Question: Can you elaborate on the tariff expenses and pricing actions? - Management discussed nominal pricing actions taken to mitigate tariff impacts and emphasized the importance of consumer response [55][57] Question: What is the long-term outlook for Joybird stores? - Management remains optimistic about Joybird's growth potential and plans to open three to four new stores while optimizing the brand [59][62] Question: How does La-Z-Boy's pricing strategy compare to competitors? - Management believes La-Z-Boy is well-positioned due to its U.S.-based manufacturing and ability to offer personalized products at competitive prices [66][69]

Core Insights - The article emphasizes the investment philosophy focused on small cap companies, highlighting the importance of identifying mispriced securities through understanding financial drivers and utilizing DCF model valuation [1]. Group 1: Investment Philosophy - The investment approach is not confined to traditional categories such as value, dividend, or growth investing, but rather considers all prospects of a stock to assess risk-to-reward [1].

Core Insights - La-Z-Boy reported quarterly earnings of $0.92 per share, missing the Zacks Consensus Estimate of $0.93 per share, and down from $0.95 per share a year ago, representing an earnings surprise of -1.08% [1] - The company posted revenues of $570.87 million for the quarter ended April 2025, surpassing the Zacks Consensus Estimate by 2.21% and up from $553.53 million year-over-year [2] - La-Z-Boy shares have declined approximately 10.7% year-to-date, contrasting with the S&P 500's gain of 2.6% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.64 on revenues of $502.4 million, and for the current fiscal year, it is $3.23 on revenues of $2.16 billion [7] - The estimate revisions trend for La-Z-Boy is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Furniture industry is currently in the top 38% of over 250 Zacks industries, suggesting that companies in the top 50% outperform those in the bottom 50% by more than 2 to 1 [8] - Bassett Furniture, another company in the same industry, is expected to report quarterly earnings of $0.15 per share, reflecting a year-over-year change of +179%, with revenues projected at $81.2 million, down 2.7% from the previous year [9]