THE BRAND HOUSE COLLECTIVE REPORTS THIRD QUARTER FISCAL 2025 RESULTS

Core Viewpoint - The Brand House Collective, Inc. reported a decline in net sales and increased net losses for the third quarter of 2025, while emphasizing strategic efforts in inventory optimization and a pending merger with Bed Bath & Beyond to enhance growth potential and operational synergies [2][5]. Financial Performance - Net sales for Q3 2025 were $103.5 million, down from $114.4 million in Q3 2024, reflecting a 7.4% decline in consolidated comparable sales and a 6% decrease in store count [5][12]. - Gross profit decreased to $21.1 million (20.4% of net sales) from $32.1 million (28.1% of net sales) in the prior year, primarily due to lower merchandise margins and increased occupancy costs [5][12]. - Operating expenses were reduced to $23.1 million (22.3% of net sales) from $34.5 million (30.2% of net sales) in the previous year, driven by lower marketing spend and reduced employee benefit costs [5][12]. - The net loss for Q3 2025 was $3.7 million, or a loss of $0.16 per diluted share, compared to a net loss of $7.7 million, or a loss of $0.59 per diluted share in Q3 2024 [5][12]. Adjusted Financial Metrics - Adjusted net loss for Q3 2025 was $13.6 million, or an adjusted loss of $0.61 per diluted share, compared to an adjusted net loss of $3.8 million, or an adjusted loss of $0.29 per diluted share in the prior year [5][12]. - Adjusted EBITDA for Q3 2025 was a loss of $9.9 million, compared to income of $0.5 million in Q3 2024 [5][12]. Inventory and Cash Position - As of November 1, 2025, inventory was $88.9 million, down from $111.2 million as of November 2, 2024 [5][12]. - The company had a cash balance of $6.5 million and $61.6 million in outstanding debt as of November 1, 2025 [5][12]. Strategic Initiatives - The company is focusing on inventory optimization to support its store conversion program, particularly the transition of Tennessee locations to the Bed Bath & Beyond Home format [2][5]. - The pending merger with Bed Bath & Beyond is expected to create a powerful omnichannel platform, enhancing the company's home retail offerings and operational synergies [2][5].