Lulus Reports Third Quarter 2025 Results

Core Insights - The company reported a net loss improvement of $4.6 million in Q3 2025 compared to Q3 2024, indicating ongoing operational and financial improvement [1] - Positive adjusted EBITDA of $0.4 million was achieved in Q3 2025, an increase of $3.9 million compared to Q3 2024 [1] - Gross profit increased by 2% in Q3 2025 compared to the same period last year [1] Financial Performance - Net revenue for Q3 2025 was $73.6 million, a 9% decrease from $80.5 million in Q3 2024, driven by a 14% decrease in total orders placed, partially offset by an 8% increase in average order value from $131 to $141 [8] - Active customers decreased by 11% to 2.4 million compared to 2.7 million in the same period last year [8] - Gross profit for Q3 2025 was $31.4 million, with a gross margin of 42.6%, an increase of 450 basis points from the prior year [8] Operational Highlights - The CEO emphasized the company's strategic priorities, including strengthening core business areas and optimizing product offerings, particularly in special occasion and bridesmaid categories [3] - The company is actively repositioning its casual wear and footwear categories while focusing on assortment optimization and cost efficiency [4] - The refined reorder pipeline has shown positive traction, contributing to improved gross and product margins, which increased over 400 basis points year-over-year [3] Cash Flow and Capital Expenditures - Year-to-date free cash flow for 2025 was $3.5 million, compared to $2.7 million in the same period last year [8] - The company reaffirmed its full-year 2025 capital expenditures estimate of approximately $2.5 million [8] Future Outlook - The company expects significant year-over-year improvement in adjusted EBITDA for Q4 2025, aligning with its strategic goals [8] - The financial outlook considers potential headwinds such as tariffs, consumer demand, and macroeconomic uncertainties [7][9]