Core Viewpoint - Purple Innovation, Inc. has revised its revenue and EBITDA outlook for the full year of 2024, expecting net revenue between $486 million and $488 million and adjusted EBITDA between $(23) million and $(21) million, while anticipating positive cash flow and adjusted EBITDA in the fourth quarter [1][2][3]. Financial Outlook - The current full year outlook for net revenue is set at $486 million to $488 million, down from the previous expectation of $490 million to $510 million [3]. - Adjusted EBITDA is now projected to be between $(23) million and $(21) million, a decrease from the earlier guidance of $(20) million to $(10) million [3]. Strategic Milestones - The CEO highlighted the importance of achieving positive cash flow and adjusted EBITDA in the fourth quarter as a significant milestone for the company's "Path to Premium Sleep" strategy [2]. Company Background - Purple is recognized as a leading premium mattress company, known for its GelFlex® Grid technology, which aims to enhance restorative sleep and reduce discomfort for various types of sleepers [5].

Financial Data and Key Metrics Changes - Net revenue for Q3 2024 was $118.6 million, down 15.3% from $140 million in the prior year [28] - Adjusted gross margin improved by 340 basis points year-over-year to 40.5%, exceeding the 40% year-end target for the second consecutive period [8][32] - Adjusted net loss for the quarter was $8.4 million, an improvement from an adjusted net loss of $19.4 million last year [34] - Adjusted EBITDA for Q3 was negative $6.4 million, an improvement from negative $16.3 million last year [34] Business Line Data and Key Metrics Changes - Direct to consumer (DTC) net revenue was $70.8 million, down 11.7% year-over-year, with e-commerce down 16% and showrooms flat [28][12] - Wholesale net revenue was $47.8 million, down 20.1% from last year, impacted by the exit from certain customer relationships [28][30] - Showrooms performed solidly, remaining flat year-over-year, driven by an increase in average selling prices [13] Market Data and Key Metrics Changes - The overall market remains challenging, with the company experiencing softness in consumer demand due to ongoing housing market struggles [7] - The company is optimistic about maintaining market share despite industry-wide demand declines, with year-to-date performance down less than 2% compared to the previous year [47] Company Strategy and Development Direction - The company is focusing on operational efficiencies through a corporate restructure and consolidation of manufacturing facilities, expecting annual EBITDA savings of $15 million to $20 million starting in 2025 [11][25] - The Path to Premium Sleep strategy aims to enhance premium positioning and drive sustained profitable growth [25] - New product innovations are planned for early 2025, including enhancements to existing collections and new product lines [24] Management's Comments on Operating Environment and Future Outlook - Management acknowledges continued pressure on revenue due to industry-wide demand declines but remains confident in the restructuring efforts to strengthen the business model long-term [25][37] - The company expects to finish the year at the lower end of revenue guidance, projecting revenue of $490 million to $510 million [37] Other Important Information - Cash and cash equivalents at the end of September were $23.4 million, down from $26.9 million at the end of 2023 [35] - Net inventories decreased by 16.9% year-over-year, indicating improved inventory management [35] Q&A Session Summary Question: Insights on revenue acceleration for Q4 - Management noted that post-Labor Day business has been soft, but they expect a pickup during the Black Friday promotion period [40] Question: Cash flow considerations moving forward - Management highlighted good progress on inventory management and expects to return to a normalized level of accounts payable by the end of Q4 [42] Question: Confidence in achieving profitability next year - Management is confident due to improvements in gross margin and does not assume significant volume increases in their projections [46] Question: Performance during Labor Day - Management indicated they are down less than 2% year-to-date, suggesting they may be gaining market share [47] Question: Status of operational manufacturing consolidation - Management reported that the consolidation is more than halfway complete with minimal disruptions [48] Question: Capacity utilization and EBITDA profitability - Current capacity utilization is about 70%, with a breakeven point for EBITDA lowered to $45 million a month [65][68]

Core Viewpoint - Purple Innovation reported a quarterly loss of $0.08 per share, better than the Zacks Consensus Estimate of a loss of $0.10, and an improvement from a loss of $0.18 per share a year ago, indicating a 20% earnings surprise [1] Financial Performance - The company posted revenues of $118.6 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 5.60%, and down from $140 million in the same quarter last year [2] - Over the last four quarters, Purple Innovation has surpassed consensus EPS estimates two times and topped consensus revenue estimates just once [2] Stock Performance - Purple Innovation shares have declined approximately 11.7% since the beginning of the year, contrasting with the S&P 500's gain of 20.1% [3] - The stock's immediate price movement will largely depend on management's commentary during the earnings call [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.06 on revenues of $132.12 million, and for the current fiscal year, it is -$0.48 on revenues of $498.05 million [7] - The estimate revisions trend for Purple Innovation is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the shares are expected to perform in line with the market in the near future [6] Industry Context - The Consumer Products - Staples industry, to which Purple Innovation belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, indicating potential challenges ahead [8]

Core Insights - Purple Innovation, Inc. reported a 15.3% decline in net revenue for Q3 2024, totaling $118.6 million, primarily due to industry-wide demand softness and reduced advertising spend [3][10] - The company achieved a GAAP gross margin of 29.7%, down 410 basis points from the previous year, but the adjusted gross margin improved by 340 basis points to 40.5% [4][27] - Adjusted EBITDA loss narrowed significantly to $(6.4) million from $(16.3) million in the prior year, indicating improved operational efficiency [7][10] Financial Performance - Q3 2024 net revenue was $118.6 million, down from $140.0 million in Q3 2023, with DTC net revenues decreasing by 11.7% and wholesale net revenues by 20.1% [3][18] - Operating expenses increased to $82.0 million, up 2.6% from $79.9 million in Q3 2023, driven by $19.8 million in restructuring-related charges [5][29] - Net loss attributable to Purple for Q3 2024 was $(39.2) million, or $(0.36) per diluted share, compared to a net loss of $(36.0) million, or $(0.34) per diluted share, in Q3 2023 [6][30] Restructuring and Operational Efficiency - The company initiated a restructuring plan in August 2024, which includes consolidating manufacturing operations and reducing headcount, expected to yield annual EBITDA savings of $15 to $20 million starting in 2025 [8][10] - Total restructuring, impairment, and related charges for Q3 2024 amounted to $32.7 million, with additional charges of $9.9 million anticipated through Q2 2025 [8][10] - The restructuring plan aims to enhance operational efficiencies and position the company to capitalize on market improvements [3][8] Balance Sheet and Cash Flow - As of September 30, 2024, cash and cash equivalents were $23.4 million, down from $26.9 million at the end of 2023, while inventories decreased by 10.5% to $59.9 million [9][10] - The company expects to be at the lower end of its guidance range for net revenue of $490 million to $510 million for the full year 2024 [10][10] Market Outlook - Despite challenges in Q3, the company remains optimistic about its Path to Premium Sleep strategy and anticipates positive adjusted EBITDA in the fourth quarter of 2024 [2][10] - The company is focused on operational improvements and aims to build on its momentum into 2025 [3][10]

Financial Performance - Third quarter 2024 net revenue decreased by 15.3% to $118.6 million, down from $140.0 million in Q3 2023[4] - Revenues for the three months ended September 30, 2024, were $118,598 thousand, a decrease of 15.2% compared to $139,996 thousand for the same period in 2023[18] - Adjusted revenues for the three months ended September 30, 2024, were $118,598 thousand, down from $143,120 thousand in the same period of 2023, reflecting a decrease of about 17%[25] - Net loss attributable to Purple Innovation for Q3 2024 was $(39.2) million, or $(0.36) per diluted share, compared to a net loss of $(36.0) million, or $(0.34) per diluted share in Q3 2023[7] - Net loss attributable to Purple Innovation Inc. for Q3 2024 was $89,418,000, compared to a net loss of $102,424,000 in Q3 2023, representing a 12.3% improvement year-over-year[44] - The net loss for Q3 2024 was $89,587,000, compared to $102,841,000 in Q3 2023, reflecting a decrease of 12.3%[44] Gross Margin and Profitability - GAAP gross margin for Q3 2024 was 29.7%, a decrease of 410 basis points from 33.8% in the prior year, while adjusted gross margin improved by 340 basis points to 40.5%[5] - Gross profit for the three months ended September 30, 2024, was $35,193 thousand, down from $47,309 thousand in the prior year, representing a decline of 25.6%[18] - Adjusted gross profit for the three months ended September 30, 2024, was $48,052 thousand, with an adjusted gross profit margin of 40.5%, compared to $53,125 thousand and 37.1% in the same period of 2023[25] Operating Expenses - Operating expenses increased by 2.6% to $82.0 million, driven by $19.8 million in restructuring-related charges[6] - Total operating expenses for the three months ended September 30, 2024, were $82,006 thousand, an increase of 2.4% from $79,923 thousand in the same period of 2023[18] - Total operating expenses for the three months ended September 30, 2024, were $82,006 thousand, compared to $79,923 thousand in the same period of 2023, indicating an increase of approximately 3%[27] - Restructuring related charges in operating expenses for the three months ended September 30, 2024, amounted to $(19,832) thousand, with no such charges in the same period of 2023[27] EBITDA and Adjusted Loss - Adjusted EBITDA loss narrowed to $(6.4) million in Q3 2024, compared to $(16.3) million in the same period last year[8] - EBITDA for the three months ended September 30, 2024, was $(27,391) thousand, compared to $(29,655) thousand for the same period in 2023, indicating an improvement in operational performance[22] - Adjusted net loss for Q3 2024 was $39,439,000, with a diluted loss per share of $0.37, compared to an adjusted net loss of $57,238,000 and a diluted loss per share of $0.55 in Q3 2023, indicating a 30.9% reduction in adjusted net loss[44] - Adjusted net loss for the three months ended September 30, 2024, was $(8,418) thousand, compared to $(19,358) thousand for the same period in 2023, showing a reduction in loss of about 57%[30] Cash and Liquidity - Cash and cash equivalents as of September 30, 2024, were $23.4 million, down from $26.9 million as of December 31, 2023[10] - Cash and cash equivalents at the end of the period were $23,399 thousand, compared to $26,606 thousand at the end of September 30, 2023[19] - The company reported a net cash used in investing activities of $(1,128) thousand for the three months ended September 30, 2024, compared to $(4,360) thousand in the same period of 2023, showing a reduction in cash outflow[19] - Cash flows from operating activities for the three months ended September 30, 2024, provided $1,119 thousand, a significant improvement from $(17,755) thousand in the prior year[19] Restructuring and Future Outlook - Total restructuring, impairment, and related charges in Q3 2024 amounted to $32.7 million, with additional charges of $9.9 million expected through Q2 2025[9] - The company anticipates annual EBITDA savings of $15 to $20 million starting in 2025 from its restructuring plan[9] - The company expects to be at the lower end of its guidance range for full-year 2024 net revenue of $490 million to $510 million[11] Tax and Shares - The company reported an adjusted income tax benefit of $13,785,000 for Q3 2024, down from $20,006,000 in Q3 2023, reflecting a decrease of 31.1%[44] - The estimated effective tax rate for the nine months ended September 30, 2024, and 2023 was 25.9%[47] - The weighted average shares, diluted, for Q3 2024 were 107,008,000, compared to 102,962,000 for Q3 2023, indicating an increase in shares outstanding[44]

Financial Performance - Total revenues for the three months ended September 30, 2024, were $118,598 thousand, a decrease of 15.2% compared to $139,996 thousand for the same period in 2023[8]. - Gross profit for the three months ended September 30, 2024, was $35,193 thousand, down 25.6% from $47,309 thousand in the prior year[8]. - Operating loss for the three months ended September 30, 2024, was $(46,813) thousand, compared to $(32,614) thousand for the same period in 2023, reflecting a deterioration of 43.5%[8]. - Net loss attributable to Purple Innovation, Inc. for the three months ended September 30, 2024, was $(39,228) thousand, compared to $(36,004) thousand in the same period last year, representing an increase in loss of 6.2%[8]. - Net loss for Q3 2024 was $89.6 million, an improvement from a net loss of $102.8 million in Q3 2023, representing a 12.3% reduction[12]. - Net revenues decreased by $21.4 million, or 15.3%, to $118.6 million for Q3 2024 compared to $140.0 million for Q3 2023, primarily due to industry-wide demand softness and reduced advertising spend[142]. - Gross profit decreased by $12.1 million, or 25.6%, to $35.2 million for Q3 2024, with a gross profit percentage of 29.7%, down from 33.8% in Q3 2023[143]. - Operating loss increased by $14.2 million, or 43.5%, to $46.8 million for Q3 2024, primarily due to restructuring and impairment charges[162]. Assets and Liabilities - Total current assets decreased to $123,188 thousand as of September 30, 2024, down 13.2% from $141,810 thousand at December 31, 2023[7]. - Total liabilities increased to $281,260 thousand as of September 30, 2024, compared to $275,018 thousand at December 31, 2023, indicating a rise of 2.5%[7]. - Cash and cash equivalents decreased to $23,399 thousand as of September 30, 2024, down 13.3% from $26,857 thousand at December 31, 2023[7]. - Accounts receivable, net, decreased to $29,662 thousand as of September 30, 2024, down 21.5% from $37,802 thousand at December 31, 2023[7]. - Inventories decreased to $59,881 thousand as of September 30, 2024, down 10.4% from $66,878 thousand at December 31, 2023[7]. - Total stockholders' equity attributable to Purple Innovation, Inc. decreased to $27,967 thousand as of September 30, 2024, down 75.8% from $115,422 thousand at December 31, 2023[7]. Cash Flow and Financing Activities - Cash used in operating activities decreased to $24.6 million in Q3 2024 from $55.8 million in Q3 2023, indicating a 56% improvement[12]. - Cash provided by financing activities in Q3 2024 was $27.5 million, down from $50.8 million in Q3 2023, a decrease of 46%[12]. - The company reported a net cash decrease of $3.5 million for Q3 2024, compared to a decrease of $15.1 million in Q3 2023, showing a 77% improvement[12]. - The company has $68.0 million of variable rate debt, with a potential increase in interest expense of approximately $0.7 million for a 100 basis point rise in interest rates[192]. Restructuring and Operational Changes - The company initiated a restructuring plan in August 2024, which includes the closure of two manufacturing facilities in Utah and consolidation of production in Georgia, expected to be completed by Q1 2025[27]. - The company recognized total restructuring, impairment, and other related charges of $32.682 million during Q3 2024, including $18.881 million in non-cash charges[28]. - The company expects the Restructuring Plan to streamline operations and improve gross profits over the long term[143]. - The company plans to launch multiple new products across major categories over the next 12 months as part of its Path to Premium Sleep strategy[151]. Legal and Compliance Matters - Purple LLC entered into a settlement agreement regarding a class action lawsuit, resulting in a cash payment, with the lawsuit dismissed on August 16, 2024[82]. - A lawsuit was filed by Purple's founders claiming approximately $2.5 million in damages related to a real estate lease dispute, with additional claims of $0.8 million in holdover rent[83]. - A class action lawsuit was filed by a former employee alleging failure to pay wages and overtime, with mediation scheduled for May 8, 2025[84]. - The company may face delisting from NASDAQ if it fails to maintain a minimum bid price of $1.00 per share, which has been below this threshold since September 30, 2024[202]. Stockholder Rights and NOLs - The Company adopted a limited-duration stockholder rights agreement to protect its estimated $238 million of net operating losses from ownership changes[76]. - The NOL Rights Plan was ratified by stockholders on October 15, 2024, aimed at protecting the company's ability to utilize approximately $238 million in current NOLs[140]. - The NOL Protective Charter Amendment was approved to prevent ownership changes that could limit the use of Current NOLs[98]. - The company has approximately $238 million in Current NOLs, with a NOL Rights Plan adopted to protect stockholder value[205]. - The company's Current NOLs (Net Operating Losses) and other tax benefits are contingent on its ability to generate taxable income in the future[206]. Stock-Based Compensation - Stock-based compensation for the quarter ending June 30, 2024, amounted to $791,000, an increase from $492,000 in the previous quarter[9]. - Total non-cash stock-based compensation recognized for the nine months ended September 30, 2024, was $2.1 million, down from $3.8 million for the same period in 2023[121]. - The Company granted 1.8 million restricted stock units during the nine months ended September 30, 2024, with a weighted average grant date fair value of $1.00 per share for awards without market vesting conditions[115]. Other Income and Expenses - Other income totaled $7.6 million for Q3 2024, compared to other expense of $3.5 million in Q3 2023, including $7.3 million from a business interruption insurance claim settlement[145]. - The Company received a total of $11.6 million from a business interruption claim settlement, recorded as other income in the condensed consolidated statement of operations[74].

LEHI, Utah, Oct. 28, 2024 /PRNewswire/ -- Purple Innovation, Inc. (NASDAQ: PRPL) ("Purple"), a comfort innovation company known for creating the "World's First No Pressure™ Mattress," will report third quarter 2024 financial results on Monday, November 4, 2024 at approximately 4:05 p.m. ET. The Company will hold a conference call that day at 4:30 p.m. ET to review the financial results. Investors and analysts interested in participating in the call are invited to dial 844-481-1976 (domestic) or 412- 317-064 ...

Purple Innovation, Inc. (NASDAQ:PRPL) Q2 2024 Earnings Conference Call August 5, 2024 4:30 PM ET Company Participants Cody McAlester – ICR Rob DeMartini – Chief Executive Officer Todd Vogensen – Chief Financial Officer Eric Haynor – Chief Operating Officer Conference Call Participants Bobby Griffin – Raymond James Brad Thomas – KeyBanc Capital Markets Matt Koranda – ROTH Capital Seth Basham – Wedbush Securities Brian Nagel – Oppenheimer Jeremy Hamblin – Craig-Hallum Capital Group Keith Hughes – Truist Dan S ...

Wall Street expects a year-over-year increase in earnings on higher revenues when Purple Innovation (PRPL) reports results for the quarter ended June 2024. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of busin ...

LEHI, Utah, July 25, 2024 /PRNewswire/ -- Purple Innovation, Inc. (NASDAQ: PRPL) ("Purple"), a comfort innovation company known for creating the "World's First No Pressure® Mattress," will report second quarter 2024 financial results on Monday, August 5, 2024, at approximately 4:05 p.m. ET. The Company will hold a conference call that day at 4:30 p.m. ET to review the financial results. Investors and analysts interested in participating in the call are invited to dial (844) 825-9789 (domestic) or (412) 317- ...