Financial Performance - Vera Bradley reported a quarterly loss of $0.36 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.13, and compared to a loss of $0.21 per share a year ago, indicating a significant earnings surprise of -176.92% [1] - The company posted revenues of $51.65 million for the quarter ended April 2025, missing the Zacks Consensus Estimate by 4.21%, and down from $80.6 million in the same quarter last year [2] - Over the last four quarters, Vera Bradley has consistently failed to surpass consensus EPS and revenue estimates [2] Stock Performance - Vera Bradley shares have declined approximately 40.2% since the beginning of the year, contrasting with the S&P 500's gain of 2.7% [3] - The current Zacks Rank for Vera Bradley is 5 (Strong Sell), indicating expectations for the stock to underperform the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.01 on revenues of $81.91 million, while for the current fiscal year, the estimate is -$0.15 on revenues of $280.39 million [7] - The trend for earnings estimate revisions for Vera Bradley is currently unfavorable, which could impact future stock performance [6] Industry Context - The Retail - Apparel and Shoes industry, to which Vera Bradley belongs, is currently ranked in the bottom 35% of over 250 Zacks industries, suggesting a challenging environment for the company [8]

[First Quarter Fiscal Year 2026 Highlights](index=1&type=section&id=First%20Quarter%20Fiscal%20Year%202026%20Highlights) Overview of Q1 FY26 performance, including CEO commentary, consolidated financial results, and Pura Vida divestiture impact [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Jackie Ardrey noted disappointing Q1 results with continued top-line and profitability declines, with the company addressing product feedback, diversifying wholesale partnerships, and committed to returning to stable growth - Q1 results were disappointing due to continued top-line and profitability trends from previous quarters[2](index=2&type=chunk) - The company is addressing consumer feedback on product styles and functionality and working on diversification of wholesale partnerships[2](index=2&type=chunk) - Management is committed to returning the Company's results to a stable and positive growth story[2](index=2&type=chunk) [Summary of Consolidated Financial Performance](index=1&type=section&id=Summary%20of%20Consolidated%20Financial%20Performance) Consolidated net revenues for Q1 FY26 decreased significantly year-over-year, with the company reporting a substantial GAAP net loss from continuing operations, which was also a loss on a non-GAAP basis after adjusting for various charges Consolidated Net Revenues (Continuing Operations) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | Net Revenues | $51.7 million | $67.9 million | -23.9% | Net Loss from Continuing Operations (GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | | :----- | :-------------------- | :-------------------- | | Net Loss | ($18.3) million | ($7.6) million | | Diluted EPS | ($0.66) | ($0.25) | Net Loss from Continuing Operations (Non-GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | | :----- | :-------------------- | :-------------------- | | Net Loss | ($10.1) million | ($6.6) million | | Diluted EPS | ($0.36) | ($0.22) | [Pura Vida Divestiture Impact](index=1&type=section&id=Pura%20Vida%20Divestiture%20Impact) Vera Bradley completed the sale of Creative Genius, Inc. (Pura Vida Bracelets) on March 31, 2025, resulting in Pura Vida's operations being classified as discontinued operations in the consolidated financial statements, with prior periods retrospectively adjusted - The Company sold **100% of Creative Genius, Inc. (Pura Vida Bracelets)** on March 31, 2025[6](index=6&type=chunk) - Pura Vida's operations have been classified as discontinued operations in the consolidated financial statements[6](index=6&type=chunk)[7](index=7&type=chunk) - Prior period amounts have been retrospectively adjusted to conform to the current period presentation[6](index=6&type=chunk) [First Quarter Financial Details](index=3&type=section&id=First%20Quarter%20Financial%20Details) Detailed analysis of Q1 FY26 financial performance, covering segment revenues, profitability, balance sheet, and capital management [Segment Revenues](index=3&type=section&id=Segment%20Revenues) Both Vera Bradley Direct and Indirect segments experienced significant revenue declines in Q1 FY26, with Direct segment comparable sales falling by 25.0% due to reduced traffic and conversion [Vera Bradley Direct Segment](index=3&type=section&id=Vera%20Bradley%20Direct%20Segment) Revenues for the Vera Bradley Direct segment decreased by 23.6% year-over-year, primarily driven by a 25.0% decline in comparable sales due to lower traffic and conversion in full-line and outlet stores Vera Bradley Direct Segment Revenues | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | Revenues | $43.1 million | $56.4 million | -23.6% | - Comparable sales declined **25.0%** in the first quarter, driven by traffic and conversion declines predominantly in full-line and outlet stores[8](index=8&type=chunk) - The Company opened two full-line stores and closed two underperforming full-line stores during the first quarter[8](index=8&type=chunk) [Vera Bradley Indirect Segment](index=3&type=section&id=Vera%20Bradley%20Indirect%20Segment) The Vera Bradley Indirect segment saw a 25.6% decrease in revenues, mainly attributed to a decline in orders from specialty and key accounts Vera Bradley Indirect Segment Revenues | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | Revenues | $8.6 million | $11.5 million | -25.6% | - The decrease was primarily related to a decline in specialty and key account orders[9](index=9&type=chunk) [Profitability Analysis](index=3&type=section&id=Profitability%20Analysis) The company experienced a significant decline in gross profit margin and an increase in SG&A as a percentage of net revenues, leading to a substantially larger operating loss from continuing operations compared to the prior year [Gross Profit](index=3&type=section&id=Gross%20Profit) Gross profit decreased by 33.1% year-over-year, with the gross profit margin falling from 50.1% to 44.1% (GAAP) and from 51.3% to 47.5% (Non-GAAP), attributed to a channel shift from brick & mortar to online, increasing outbound freight costs Gross Profit (GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | Gross Profit | $22.8 million | $34.0 million | -33.1% | | % of Net Revenues | 44.1% | 50.1% | -6.0 pp | Gross Profit (Non-GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | Gross Profit | $24.6 million | $34.8 million | -29.3% | | % of Net Revenues | 47.5% | 51.3% | -3.8 pp | - The decrease in consolidated gross profit as a percentage of net revenues resulted from channel shift from brick & mortar stores to online sites, which also contributed to increased outbound freight cost[10](index=10&type=chunk) [Selling, General, and Administrative (SG&A) Expenses](index=3&type=section&id=Selling%2C%20General%2C%20and%20Administrative%20(SG%26A)%20Expenses) While absolute SG&A expenses decreased, they increased significantly as a percentage of net revenues, from 66.4% to 79.0% (GAAP) and from 65.7% to 74.2% (Non-GAAP), with the non-GAAP decrease in absolute terms due to cost reduction initiatives and reduced variable costs SG&A Expense (GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | SG&A Expense | $40.8 million | $45.1 million | -9.5% | | % of Net Revenues | 79.0% | 66.4% | +12.6 pp | SG&A Expense (Non-GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | SG&A Expense | $38.3 million | $44.7 million | -14.3% | | % of Net Revenues | 74.2% | 65.7% | +8.5 pp | - The decrease in non-GAAP SG&A expense resulted from delivery of cost reduction initiatives along with reduced variable costs[11](index=11&type=chunk) [Operating Loss from Continuing Operations](index=3&type=section&id=Operating%20Loss%20from%20Continuing%20Operations) The company's operating loss from continuing operations widened substantially, reaching **($17.9) million (34.6% of net revenues)** on a GAAP basis and **($13.6) million (26.3% of net revenues)** on a non-GAAP basis, indicating a significant deterioration in operational profitability Operating Loss from Continuing Operations (GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | | :----- | :-------------------- | :-------------------- | | Operating Loss | ($17.9) million | ($10.6) million | | % of Net Revenues | (34.6%) | (15.6%) | Operating Loss from Continuing Operations (Non-GAAP) | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | | :----- | :-------------------- | :-------------------- | | Operating Loss | ($13.6) million | ($9.4) million | | % of Net Revenues | (26.3%) | (13.8%) | Segment Operating Loss (Non-GAAP) | Segment | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | | :------ | :-------------------- | :-------------------- | | VB Direct | ($2.8) million | $4.9 million | | VB Indirect | $2.2 million | $3.8 million | [Balance Sheet and Capital](index=3&type=section&id=Balance%20Sheet%20and%20Capital) The company maintained a strong financial condition with no debt but experienced a significant decrease in cash and cash equivalents, while inventory levels remained relatively stable and capital spending increased [Cash and Liquidity](index=3&type=section&id=Cash%20and%20Liquidity) Cash and cash equivalents decreased substantially to **$11.3 million** as of May 3, 2025, from **$43.8 million** in the prior year, with the company reporting no borrowings on its **$75 million** asset-based lending (ABL) facility, indicating strong liquidity Cash and Cash Equivalents | Metric | May 3, 2025 | May 4, 2024 | Change | | :----- | :---------- | :---------- | :----- | | Cash & Equivalents | $11.3 million | $43.8 million | -74.2% | - The Company had no borrowings on its **$75 million** asset-based lending (ABL) facility at quarter end[13](index=13&type=chunk) [Inventory](index=3&type=section&id=Inventory) Total quarter-end inventory slightly decreased to **$99.2 million** compared to **$101.8 million** in the prior year, indicating relatively stable inventory management Total Quarter-End Inventory | Metric | May 3, 2025 | May 4, 2024 | Change | | :----- | :---------- | :---------- | :----- | | Inventory | $99.2 million | $101.8 million | -2.6% | [Net Capital Spending](index=3&type=section&id=Net%20Capital%20Spending) Net capital spending for the first quarter increased to **$1.8 million** from **$0.9 million** in the prior year, primarily driven by the timing of new store openings Net Capital Spending | Metric | Q1 FY26 (May 3, 2025) | Q1 FY25 (May 4, 2024) | Change | | :----- | :-------------------- | :-------------------- | :----- | | Capital Spending | $1.8 million | $0.9 million | +100% | - Increase was driven by timing of new store openings in the current year period compared to prior year[14](index=14&type=chunk) [Forward Outlook](index=3&type=section&id=Forward%20Outlook) The company has suspended forward guidance due to executive changes and market uncertainty, allowing the new team to define future expectations [Forward Outlook](index=3&type=section&id=Forward%20Outlook) Due to recent executive and Board leadership changes and significant uncertainty in the consumer environment, Vera Bradley has suspended its forward guidance, allowing the new team time to provide input on future strategic and financial expectations - The Company announced several executive and Board leadership changes[15](index=15&type=chunk) - Forward guidance is suspended due to these changes and significant uncertainty surrounding the consumer environment[15](index=15&type=chunk) - Suspension allows the new team time to provide input on future strategic and financial expectations[15](index=15&type=chunk) [Disclosure Regarding Non-GAAP Measures](index=3&type=section&id=Disclosure%20Regarding%20Non-GAAP%20Measures) Explanation of non-GAAP financial measures used by the company to provide a clearer year-over-year performance comparison, excluding specific charges [Disclosure Regarding Non-GAAP Measures](index=3&type=section&id=Disclosure%20Regarding%20Non-GAAP%20Measures) Vera Bradley provides non-GAAP financial measures to offer a more direct comparison of year-over-year performance, consistent with management's evaluation, excluding specific charges like impairment, cancellation fees, professional fees, and severance, along with their tax impacts, without suggesting these measures replace GAAP - Non-GAAP measures exclude specific charges such as property, plant, & equipment impairment, PO cancellation fees, professional fees related to Pura Vida sale, consulting fees, severance, and inventory write-offs, along with their tax effects[16](index=16&type=chunk)[18](index=18&type=chunk) - Management believes non-GAAP measures are helpful for investors by allowing a more direct comparison of year-over-year performance and are consistent with management's evaluation of business performance[20](index=20&type=chunk) - The Company does not suggest that investors should consider non-GAAP measures in isolation from, or as a substitute for, GAAP financial information[19](index=19&type=chunk) [Company Information](index=4&type=section&id=Company%20Information) Provides background on Vera Bradley, its reportable segments, investor relations details, and a safe harbor statement regarding forward-looking information [About Vera Bradley, Inc.](index=4&type=section&id=About%20Vera%20Bradley%2C%20Inc.) Vera Bradley, based in Fort Wayne, Indiana, is a designer of women's handbags, luggage, travel items, fashion and home accessories, and gifts, founded in 1982 and known for its innovative designs, iconic patterns, and colors - Vera Bradley is a leading designer of women's handbags, luggage and other travel items, fashion and home accessories, and unique gifts[23](index=23&type=chunk) - Founded in 1982, the brand is known for its innovative designs, iconic patterns, and brilliant colors[23](index=23&type=chunk) [Reportable Segments Description](index=4&type=section&id=Reportable%20Segments%20Description) The company operates through two reportable segments: Vera Bradley Direct (VB Direct), which includes sales through its full-line and outlet stores, websites, and annual outlet sale; and Vera Bradley Indirect (VB Indirect), which involves sales to specialty retail locations, department stores, national accounts, third-party e-commerce, liquidators, and licensing royalties - The Company has two reportable segments: Vera Bradley Direct ('VB Direct') and Vera Bradley Indirect ('VB Indirect')[24](index=24&type=chunk) - VB Direct business consists of sales through Vera Bradley Full-Line and Outlet stores, Vera Bradley's websites, and the Vera Bradley annual outlet sale[24](index=24&type=chunk) - VB Indirect business consists of sales to approximately **1,200 specialty retail locations**, select department stores, national accounts, third-party e-commerce sites, third-party inventory liquidators, and royalties recognized through licensing agreements[24](index=24&type=chunk) [Investor Relations and Website Information](index=4&type=section&id=Investor%20Relations%20and%20Website%20Information) Vera Bradley routinely posts important investor information on the 'Investor Relations' section of its website, www.verabradley.com, which serves as a means of disclosing material non-public information and complying with Regulation FD, and also provides access to its Corporate Responsibility and Sustainability Report - Important information for investors is routinely posted on **www.verabradley.com** in the 'Investor Relations' section, used for disclosing material, non-public information and complying with Regulation FD[25](index=25&type=chunk) - The Company's most recent Corporate Responsibility and Sustainability Report outlining its ESG initiatives is available at **https://verabradley.com/pages/corporate-responsibility**[26](index=26&type=chunk) - A conference call to discuss Q1 results was scheduled for June 11, 2025, with broadcast and replay details provided[22](index=22&type=chunk) [Safe Harbor Statement](index=4&type=section&id=Safe%20Harbor%20Statement) The safe harbor statement clarifies that certain statements in the release are forward-looking and subject to various risks and uncertainties that could cause actual results to differ materially, including economic conditions, consumer demand, talent retention, brand maintenance, strategic plan implementation, store operations, tariffs, supply chain disruptions, and macro factors - Certain statements in this release are 'forward-looking statements' made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995[27](index=27&type=chunk) - Such statements are subject to various risks and uncertainties that may cause actual results to differ materially, including adverse changes in economic conditions, inability to predict consumer demand, loss of key management, inability to maintain brands, and challenges in implementing strategic plans[27](index=27&type=chunk)[28](index=28&type=chunk) - The Company undertakes no obligation to publicly update or revise any forward-looking statement[28](index=28&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) Presents the company's condensed consolidated balance sheets, statements of operations, and cash flows for the first quarter [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decrease in total assets, primarily driven by a significant reduction in cash and cash equivalents and the reclassification of Pura Vida assets to discontinued operations, while total liabilities remained relatively stable and shareholders' equity decreased Condensed Consolidated Balance Sheets (Selected Items, in thousands) | Metric | May 3, 2025 | Feb 1, 2025 | May 4, 2024 | | :-------------------------- | :---------- | :---------- | :---------- | | Cash and cash equivalents | $11,281 | $28,628 | $43,810 | | Inventories | $99,151 | $91,430 | $101,836 | | Total current assets | $135,546 | $164,872 | $218,430 | | Total assets | $267,940 | $306,690 | $368,689 | | Total current liabilities | $59,503 | $57,993 | $63,000 | | Total liabilities | $121,906 | $127,735 | $122,773 | | Total shareholders' equity | $146,034 | $178,955 | $245,916 | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statements of operations show a substantial decline in net revenues and a significant increase in net loss for Q1 FY26 compared to Q1 FY25, primarily due to lower gross profit, higher SG&A as a percentage of revenue, and a large loss from discontinued operations Condensed Consolidated Statements of Operations (Selected Items, in thousands) | Metric | Thirteen Weeks Ended May 3, 2025 | Thirteen Weeks Ended May 4, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Net revenues | $51,652 | $67,948 | | Gross profit | $22,767 | $34,040 | | Selling, general, and administrative expenses | $40,804 | $45,095 | | Operating loss from continuing operations | ($17,857) | ($10,617) | | Net loss from continuing operations | ($18,260) | ($7,604) | | Loss from discontinued operations, net of income tax | ($15,200) | ($517) | | Net loss | ($33,460) | ($8,121) | | Diluted net loss per share (Continuing operations) | ($0.66) | ($0.25) | | Diluted net loss per share (Discontinued operations) | ($0.54) | ($0.01) | | Diluted net loss per share | ($1.20) | ($0.26) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The cash flow statement indicates a significant net cash outflow from operating activities in Q1 FY26, primarily driven by the net loss, and a net decrease in cash and cash equivalents, with proceeds from the sale of Pura Vida partially offsetting cash used in investing activities Condensed Consolidated Statements of Cash Flows (Selected Items, in thousands) | Metric | Thirteen Weeks Ended May 3, 2025 | Thirteen Weeks Ended May 4, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Net cash used in operating activities | ($17,902) | ($14,549) | | Net cash used in investing activities | ($968) | ($863) | | Net cash used in financing activities | ($171) | ($6,704) | | Net decrease in cash and cash equivalents | ($19,085) | ($22,108) | | Cash and cash equivalents, end of period | $11,281 | $55,195 | - Proceeds from sale of business, net of cash disposed, was **$903 thousand** in Q1 FY26[35](index=35&type=chunk) [GAAP to Non-GAAP Reconciliations](index=9&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliations) Reconciliations of GAAP to non-GAAP financial measures for Q1 FY26 and Q1 FY25, detailing specific adjustments and their impact [Q1 Fiscal 2026 Reconciliation](index=9&type=section&id=Q1%20Fiscal%202026%20Reconciliation) The reconciliation for Q1 FY26 details adjustments totaling **$8.2 million** (net-of-tax) to GAAP net loss, including charges for PPE impairment, PO cancellation fees, Pura Vida sale-related professional fees and inventory write-offs, consulting fees, and severance, to arrive at the non-GAAP net loss Q1 FY26 GAAP to Non-GAAP Net Loss Reconciliation (in thousands) | Adjustment | Amount | | :------------------------------------------ | :----- | | Net loss from continuing operations (GAAP) | ($18,260) | | PPE impairment charges | 1,048 | | PO cancellation fees | 986 | | Professional fees associated with sale of Pura Vida | 976 | | Consulting and professional fees | 721 | | Severance | 290 | | Inventory write-off associated with sale of Pura Vida | 250 | | Income tax adjustments | 3,938 | | Net loss from continuing operations (Non-GAAP) | ($10,051) | | Diluted net loss per share (Non-GAAP) | ($0.36) | - The net-of-tax impact of these adjustments totaled **$8.2 million**[4](index=4&type=chunk) [Q1 Fiscal 2025 Reconciliation](index=10&type=section&id=Q1%20Fiscal%202025%20Reconciliation) The reconciliation for Q1 FY25 outlines adjustments to GAAP net loss, including one-time vendor charges, severance, and consulting fees, along with their tax effects, to arrive at the non-GAAP net loss Q1 FY25 GAAP to Non-GAAP Net Loss Reconciliation (in thousands) | Adjustment | Amount | | :------------------------------------------ | :----- | | Net loss from continuing operations (GAAP) | ($7,604) | | One-time vendor charges | 747 | | Severance | 436 | | Consulting and professional fees | 38 | | Income tax adjustments | (222) | | Net loss from continuing operations (Non-GAAP) | ($6,605) | | Diluted net loss per share (Non-GAAP) | ($0.22) | - The net-of-tax impact of these adjustments totaled **$1.0 million**[5](index=5&type=chunk)

Core Insights - Vera Bradley, Inc. reported first quarter consolidated net revenues of $51.7 million, a decrease from $67.9 million in the same period last year [3][32] - The company experienced a net loss from continuing operations of $18.3 million, or $0.66 per diluted share, compared to a net loss of $7.6 million, or $0.25 per diluted share in the prior year [4][5] - The financial condition remains strong with $86 million in liquidity and no debt [1] Financial Performance Summary - The first quarter gross profit was $22.8 million, representing 44.1% of net revenues, down from $34.0 million or 50.1% in the prior year [10] - Selling, general, and administrative (SG&A) expenses totaled $40.8 million, or 79.0% of net revenues, compared to $45.1 million, or 66.4% in the prior year [12] - The operating loss from continuing operations was $17.9 million, or (34.6%) of net revenues, compared to a loss of $10.6 million, or (15.6%) in the prior year [13] Segment Performance - Vera Bradley Direct segment revenues were $43.1 million, a 23.6% decrease from $56.4 million in the prior year [8] - Comparable sales declined by 25.0%, primarily due to reduced traffic and conversion rates in full-line and outlet stores [8] - The Indirect segment revenues totaled $8.6 million, a 25.6% decrease from $11.5 million in the prior year, attributed to a decline in specialty and key account orders [9] Balance Sheet Highlights - Cash and cash equivalents as of May 3, 2025, were $11.3 million, down from $43.8 million at the end of the previous year's first quarter [13] - Total quarter-end inventory was $99.2 million, compared to $101.8 million at the end of the prior year's first quarter [14] Strategic Outlook - The company announced several executive and Board leadership changes and has suspended forward guidance due to significant uncertainty in the consumer environment [15]

Leadership Changes - CEO Jacqueline Ardrey is leaving the Company, with a national search for her replacement underway. She will assist in the transition until the end of July 2025 [1][2] - Ian Bickley will assume the role of Executive Chairman effective July 7, 2025, providing leadership during the CEO transition. He has extensive experience in the industry, including roles at Coach and as Interim CEO of the Body Shop [2][3] - Martin Layding has been appointed as the new Chief Financial Officer, starting June 12, 2025, succeeding Michael Schwindle, who will depart on June 30, 2025 [3] Strategic Initiatives - A new Strategy and Transformation Committee has been established to guide the Company's strategic direction and growth initiatives, co-led by Ian Bickley and Director Andrew Meslow [4] - The Company aims to refine its strategy and accelerate its transformation under the new leadership [5] Company Overview - Vera Bradley is a leading designer of women's handbags, luggage, and other travel items, known for its innovative designs and iconic patterns [6] - The Company operates through two reportable segments: Vera Bradley Direct and Vera Bradley Indirect, with sales through various retail channels and online platforms [7]

Core Viewpoint - Vera Bradley, Inc. is set to report its financial results for the first quarter of fiscal year 2026 on June 11, 2025, at 8:00 a.m. Eastern Time, followed by a conference call at 9:30 a.m. Eastern Time to discuss the results [1][2]. Company Overview - Vera Bradley, Inc. operates two lifestyle brands: Vera Bradley and Pura Vida, both targeting a devoted female customer base with a focus on community and social consciousness [3]. - Vera Bradley is recognized for its innovative designs in women's handbags, luggage, and accessories, established in 1982 by Barbara Bradley Baekgaard and Patricia R. Miller [4]. - Pura Vida, based in La Jolla, California, is a digitally native brand offering bracelets and lifestyle accessories, emphasizing engagement and differentiation [5]. Business Segments - The company has three reportable segments: - Vera Bradley Direct (VB Direct), which includes sales through full-line and outlet stores, websites, and annual outlet sales [5]. - Vera Bradley Indirect (VB Indirect), consisting of sales to approximately 1,200 specialty retail locations and other channels [5]. - Pura Vida, which encompasses sales through its website, wholesale retailers, and Pura Vida retail stores [5].

Core Viewpoint - Vera Bradley's long-time board member Frances P. Philip will not seek re-election at the 2025 Shareholder Meeting, marking the end of her 14-year tenure on the board [1][3]. Group 1: Board Member Contributions - Frances P. Philip joined the Vera Bradley Board in 2011 and has been a member of the Talent and Compensation Committee, as well as the Nominating, Governance and Sustainability Committee [2]. - She has served as the Lead Independent Director since 2022, providing insights from her extensive experience in product development, branding, marketing, and retail [2]. - Robert Hall, Chairman of the Board, acknowledged her strategic insight and expertise in merchandising and product development as significant contributions to the company's journey [3]. Group 2: Company Overview - Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women's handbags, luggage, travel items, fashion and home accessories, and unique gifts [4]. - The company was founded in 1982 and is recognized for its innovative designs, iconic patterns, and vibrant colors that resonate with women globally [4]. Group 3: Business Segments - Vera Bradley operates through two reportable segments: Vera Bradley Direct ("VB Direct") and Vera Bradley Indirect ("VB Indirect") [5]. - The VB Direct segment includes sales through full-line and outlet stores, as well as the company's websites and annual outlet sale [5]. - The VB Indirect segment consists of sales to approximately 1,200 specialty retail locations, select department stores, and third-party e-commerce sites, along with royalties from licensing agreements [5].

Financial Performance - For fiscal 2025, net revenues decreased by $98.8 million, or 21.0%, to $372.0 million from $470.8 million in fiscal 2024[245]. - Gross profit for fiscal 2025 was $186.8 million, representing 50.2% of net revenues, compared to $256.4 million or 54.5% in fiscal 2024[243]. - Selling, general, and administrative expenses (SG&A) for fiscal 2025 were $223.8 million, accounting for 60.2% of net revenues, compared to $241.5 million or 51.3% in fiscal 2024[243]. - Operating loss for fiscal 2025 was $(42.4) million, a decrease of $52.8 million, or 505.7%, from operating income of $10.4 million in fiscal 2024[254]. - Net loss for fiscal 2025 was $(62.2) million, a decrease of $70.0 million from net income of $7.8 million in fiscal 2024[262]. - Gross profit for fiscal 2025 decreased by $69.6 million, or 27.1%, to $187.8 million, with gross profit as a percentage of net revenues dropping to 50.2% from 54.5%[250]. - SG&A expenses decreased by $17.7 million, or 7.3%, to $223.8 million, representing 60.2% of net revenues compared to 51.3% in fiscal 2024[251]. Revenue Breakdown - The VB Direct segment generated $257.6 million in revenues for fiscal 2025, making up 69.3% of total net revenues[244]. - Pura Vida segment revenues decreased to $53.2 million in fiscal 2025, representing 14.3% of total net revenues[244]. - Comparable sales, including e-commerce, decreased by 16.6% in fiscal 2025[244]. - Vera Bradley comparable sales decreased by $49.6 million, or 16.6%, including a 22.2% decrease in comparable store sales and a 7.3% decrease in e-commerce sales[246]. Store Operations - The company closed six stores and opened eight stores during fiscal 2025, ending the year with 126 total stores[244]. Impairment Charges - The impairment of goodwill and intangible assets was $6.2 million in fiscal 2025, compared to $5.4 million in fiscal 2024[243]. - An impairment charge of $6.2 million was recorded for the Pura Vida brand in the fourth quarter of fiscal 2025[284]. - An impairment charge of $5.4 million was recorded for the Pura Vida brand during fiscal 2024[285]. - Impairment charges of $44.3 million and $25.0 million were recorded during fiscal 2023 for goodwill and the Pura Vida brand, respectively[286]. - Impairment charges for long-lived assets were $2.6 million and $1.4 million for the periods ended February 1, 2025, and January 28, 2023, respectively[280]. - Goodwill was fully impaired during fiscal 2023, resulting in no balance as of February 1, 2025[282]. Cash Flow and Financing - Net cash used in operating activities was $(14.1) million in fiscal 2025, compared to net cash provided of $48.0 million in fiscal 2024[268]. - Net cash used in investing activities was $10.4 million in fiscal 2025, a decrease from $13.8 million in fiscal 2024[270]. - Net cash used in financing activities increased to $22.5 million in fiscal 2025 from $3.5 million in fiscal 2024, primarily due to increased stock repurchases[271]. - The company has access to a $75.0 million asset-based revolving credit agreement, with no debt outstanding as of February 1, 2025[264]. - The Credit Agreement allows for a revolving credit commitment of $75.0 million, with interest rate changes impacting annual interest expense by approximately $0.2 million for each quarter point[287]. Strategic Initiatives - The company continued to implement strategic price increases across both brands to mitigate inflationary pressures[239]. - The company is focused on enhancing customer experience and optimizing its product and pricing strategy based on selling data and customer feedback[225]. Inventory Management - The balance of inventory adjustments was $7.7 million and $8.1 million for the fiscal years ended February 1, 2025, and February 3, 2024, respectively[278]. - The company sources a majority of its finished goods from suppliers in various countries, with purchases and sales primarily denominated in U.S. dollars, mitigating foreign exchange rate risk[288].

Core Insights - Vera Bradley, Inc. co-founder Barbara Baekgaard will not seek re-election at the upcoming shareholders meeting and will transition to a Director Emeritus role while remaining involved in the brand transformation [1][5] Company Overview - Baekgaard co-founded Vera Bradley in 1982 with Patricia Miller, significantly contributing to its growth into a recognized lifestyle brand known for vibrant, handcrafted patterns and innovative designs [2] - The company has a mission to empower women through thoughtful design, social impact, and a commitment to giving back, values that Baekgaard has championed since the brand's inception [5] Leadership and Impact - CEO Jackie Ardrey emphasized Baekgaard's pivotal role in shaping the company and the communities it serves, highlighting her leadership, creativity, and generosity [3] - Baekgaard expressed appreciation for the support from the Board and optimism about the company's future under current leadership [5] Philanthropic Efforts - Baekgaard co-established the Vera Bradley Foundation for Breast Cancer in 1994, which has raised over $41 million for breast cancer research [4] - She also founded The Bradley, a boutique hotel in Fort Wayne, and continues her philanthropic endeavors while serving on boards focused on medical research [4]

Financial Data and Key Metrics Changes - For Q4 fiscal 2025, consolidated revenues totaled $100 million, a decrease from $133.3 million in the prior year [35] - The net loss for Q4 was $8.3 million, or $0.30 per diluted share, compared to a net income of $3.5 million, or $0.11 per diluted share last year [35] - Q4 gross margin was 45.7%, down from 52.3% in the previous year, reflecting a mix shift across sales channels [13][38] - Year-end cash and cash equivalents totaled $30.4 million, with no debt and liquidity of $75 million [27] Business Line Data and Key Metrics Changes - Vera Bradley direct segment revenues for Q4 were $76.5 million, a 17.8% decrease from $93 million in the prior year [35] - Indirect segment revenues for Q4 totaled $9.9 million, a 39% decrease from $16.1 million in the prior year [37] - Pura Vida segment revenues for Q4 were $13.6 million, a 44% decrease from $24.2 million in the prior year [37] Market Data and Key Metrics Changes - E-commerce revenues were roughly flat compared to last year, while outlet stores experienced declines in traffic and conversion [11] - Notably, there was approximately 10% growth among customers aged 18 to 34 with household incomes above $100,000 [11] Company Strategy and Development Direction - The company is undergoing Project Restoration, a strategic initiative to transform its business model and brand positioning [6] - A significant development was the decision to sell the Pura Vida business to concentrate resources on strengthening Vera Bradley's market position [9] - The company plans to expand heritage products and reduce higher price point assortments while focusing on customer feedback for product adjustments [7][8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the transformation is taking longer than anticipated but remains confident in the strategic direction [6] - The company expects continued business headwinds due to economic trends and consumer uncertainty, particularly affecting the outlet channels [46][68] - For fiscal 2026, the company anticipates consolidated net revenues of approximately $280 million, reflecting ongoing consumer challenges [46] Other Important Information - The company is targeting a further 10% reduction in overall inventory for fiscal 2026, building on a 7% reduction from the previous year [16][51] - The company expects to deliver cost savings of a minimum of $20 million in fiscal 2026 through efficiency initiatives [26] Q&A Session Summary Question: Focus on digital marketplaces and purchasing differences - Management noted that the Target Marketplace has been extremely successful and aligns well with customer shopping preferences [56] Question: Collaborations and their flow this year - Management indicated that the Wicked collection has been successful in attracting desirable customers and plans to have a more robust assortment this year [60] Question: Balancing old and new customers - Management emphasized the importance of closely monitoring sales data to understand customer preferences and adapt product offerings accordingly [62] Question: Ability to pivot amid macroeconomic headwinds - Management acknowledged the need for adjustments in strategy due to consumer stress and is actively working on improving performance [68]

Vera Bradley, Inc. (NASDAQ:VRA) Q4 2025 Earnings Conference Call March 12, 2025 9:30 AM ET Company Participants Mark Dely - CAO Jackie Ardrey - CEO Michael Schwindle - CFO Conference Call Participants Eric Beder - SCC Research Daniel Harriman - Sidoti Operator Greetings, and welcome to the Vera Bradley, Inc. Fourth Quarter Fiscal 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. As a reminder, thi ...