Costco - Costco reported quarterly earnings with revenue in line with estimates and EPS of 450, slightly below the expected 456 [2] - Sales increased by 8.2% year-over-year, with comparable same-store sales rising 5.9% in the US and 6.4% globally [2] - E-commerce sales surged over 20%, with website traffic up 24% and app traffic increasing by 48% [3] - The company faced challenges from tariffs, with about one-third of US sales coming from imports, prompting efforts to source more products domestically [4] - Legal actions have been taken against the Trump administration regarding tariffs, seeking refunds and blocking further collections [5] - Overall results did not impress investors, as the sales figures were anticipated due to monthly reports [6] RH (Restoration Hardware) - RH shares rose over 5% following better-than-expected revenue of 883.81 million, although adjusted EPS missed expectations at 171 compared to the anticipated 213 [8][9] - The company outperformed competitors like Lazy Boy and Wayfair despite challenges from tariffs [9] - The CEO acknowledged the difficult housing market but noted the brand's disruptive nature, suggesting potential support from higher-end consumers [11] Citigroup - Citigroup received an upgrade from JP Morgan Chase, which raised its price target to 124, indicating double-digit upside potential [13] - The stock has performed well year-to-date, benefiting from a solid economy, increased M&A activity, and a favorable regulatory environment [14] - JP Morgan Chase views Citigroup as undervalued compared to peers, contributing to a more bullish outlook [14]

Financial Data and Key Metrics Changes - Revenue increased by 9% in Q3 and 18% on a two-year basis, despite challenging housing market conditions [4] - Adjusted operating margin was 11.6%, below the guidance midpoint of 12.5% due to higher-than-expected tariff expenses [4] - Adjusted EBITDA margin was reported at 17.6%, with free cash flow of $83 million in Q3 and $198 million year-to-date, on track to meet the annual target of $250 million to $300 million [4][5] Business Line Data and Key Metrics Changes - The company is making progress in reducing excess inventory, estimated at $300 million, with inventory down 11% year-over-year and $82 million lower than Q2 [5] - Market share gains are being achieved from fragmented design showrooms and high-end furniture stores, with two-year share gains ranging from 12 to 28 points [5] Market Data and Key Metrics Changes - The current housing market is described as the worst in nearly 50 years, with existing home sales projected to average 4.07 million from 2023 to 2025, compared to 4.09 million in 1978 [8] - Tariffs have disrupted supply chains, leading to increased prices and multiple rounds of price negotiations [8] Company Strategy and Development Direction - The company is focused on long-term growth, emphasizing innovation and investment during challenging times, with plans for a significant product transformation launch in spring next year [9] - A global hospitality business is being developed to enhance brand awareness and cash flow, with the RH Ocean Grill expected to generate significant operating income [10][11] - The establishment of a freestanding interior design firm aims to expand the brand's presence beyond product sales to conceptualizing and selling spaces [11][12] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the unusual market conditions and the risks involved, emphasizing the importance of navigating these challenges strategically [8][9] - The outlook for Q4 includes revenue growth of 7%-8% and an adjusted operating margin of 12.5%-13.5%, factoring in the impact of international expansion and tariffs [6][7] - For fiscal year 2025, the revenue growth outlook is set at 9%-9.2%, with adjusted operating margins expected to be between 11.6%-11.9% [7] Other Important Information - The company is launching a new collection targeting high-end architectural aesthetics, with plans to unveil it at the Salone in Milan [59][61] - The acquisition of Michael Taylor Designs is expected to enhance the brand's offerings in the high-end market [64] Q&A Session Summary Question: Demand for RH Paris and its influence on performance expectations for RH Milan and RH London - Management noted that RH Paris is unique and has set a tone for future openings, with expectations for strong performance in Milan and London [16][17] Question: Customer response to recent price increases and elasticity - Management indicated that they are learning from the price increases and navigating the tariff situation, aiming for a fair playing field in the market [51][53][55] Question: Guidance for Q4 and potential limitations on managing tariffs - Management acknowledged the dynamic situation with tariffs and indicated that while there may be some slowdown, they are proud of their navigation strategies [76][78]

Financial Data and Key Metrics Changes - Revenue increased by 9% in Q3 and 18% on a two-year basis, despite challenging housing market conditions [4] - Adjusted operating margin was 11.6%, below the guidance midpoint of 12.5% due to higher-than-expected tariff expenses [4] - Adjusted EBITDA was 17.6%, with free cash flow of $83 million in Q3 and $198 million year-to-date, on track to meet the annual target of $250 million to $300 million [4][5] Business Line Data and Key Metrics Changes - Inventory decreased by 11% year-over-year and by $82 million compared to Q2, with a goal to reduce excess inventory estimated at $300 million [5] - Market share gains were noted from fragmented design showrooms and high-end furniture stores, with two-year share gains ranging from 12 to 28 points [5] Market Data and Key Metrics Changes - The company is navigating the worst housing market in nearly 50 years, with existing home sales projected to average 4.07 million from 2023 to 2025, a significant decrease compared to historical figures [9] - Tariffs have disrupted supply chains, leading to increased costs and product delays, with 16 tariff announcements in the past 10 months impacting operations [9] Company Strategy and Development Direction - The company is focused on long-term growth, emphasizing innovation and investment during challenging times, with plans for a significant product transformation launch in spring 2026 [10][11] - A global hospitality business is being developed to enhance brand awareness and cash flow, with the opening of RH Paris as a key milestone [11][12] - The establishment of a freestanding interior design firm aims to expand the brand's presence beyond product sales to space conceptualization [12][13] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the unusual market conditions and the risks associated with tariffs and supply chain disruptions, but remains optimistic about gaining market share [9][10] - The company plans to continue its aggressive investment strategy, believing that it will be well-positioned for growth when the housing market improves [10][62] Other Important Information - The company has acquired Michael Taylor Designs, enhancing its portfolio in the high-end interior design space [58] - The upcoming collection launch at Salone in Milan is expected to significantly impact the brand's growth trajectory over the next decade [54][55] Q&A Session Summary Question: How has the customer responded to price increases in Q3? - Management noted that they have implemented several price increases due to tariffs and are observing customer elasticity in response [47][48] Question: Can you provide insights on the new collection launching next year? - The new collection is anticipated to be the biggest incremental move for the company, targeting high-end architectural aesthetics and launching at Salone in Milan [54][55] Question: Should the company consider slowing the pace of initiatives for predictability? - Management emphasized the importance of maintaining high ambitions and not compromising on growth strategies, even in a challenging environment [60][62]

Financial Data and Key Metrics Changes - Revenue increased by 9% in Q3 2025 and 18% on a two-year basis, despite challenging housing market conditions [4] - Adjusted operating margin was 11.6%, below the guidance midpoint of 12.5% due to higher-than-expected tariff expenses [4][6] - Adjusted EBITDA margin was reported at 17.6%, with free cash flow of $83 million in Q3 and $198 million year-to-date, on track to meet the annual target of $250 million to $300 million [4][5][7] Business Line Data and Key Metrics Changes - The company is making progress in reducing excess inventory, which is estimated at $300 million, with inventory down 11% year-over-year and $82 million lower than Q2 [5] - Market share gains are primarily coming from fragmented design showrooms and regional high-end furniture stores, with two-year share gains ranging from 12 to 28 points [5] Market Data and Key Metrics Changes - The company is navigating the worst housing market in nearly 50 years, with existing home sales projected to average 4.07 million from 2023 to 2025, compared to 4.09 million in 1978 [9] - Tariffs have disrupted supply chains, leading to increased prices and multiple rounds of price negotiations [9] Company Strategy and Development Direction - The company is focused on long-term growth, emphasizing innovation and investment during challenging times, with plans for a significant product transformation in the spring of next year [10][11] - The launch of RH Paris is seen as a pivotal move in building a global luxury brand, with plans for additional locations in Milan and London [20][21] - The company is developing a global hospitality business to enhance brand awareness and cash flow, with the RH Ocean Grill expected to generate significant operating income [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the unusual market conditions and the risks associated with tariffs and supply chain disruptions, but remains optimistic about gaining market share [9][10] - The company is preparing for a potential recovery in the housing market and believes its investments will pay off in the long run [8][61] Other Important Information - The company has opened a freestanding interior design office in Palm Desert, generating $1 million a month in design business [13] - The acquisition of Michael Taylor Designs is expected to enhance the company's offerings in the high-end market [56] Q&A Session Summary Question: How has RH Paris influenced performance expectations ahead of RH Milan and RH London? - Management noted that RH Paris is unique and has set a tone for future openings, emphasizing the importance of location and brand perception in Europe [16][17] Question: How did customers respond to price increases in Q3? - Management indicated that they are learning from the price increases and navigating the tariff situation, with a focus on maintaining fairness in pricing [47][48] Question: Is the company considering slowing the pace of initiatives for predictability? - Management expressed a commitment to high ambitions and strategic growth, emphasizing the importance of long-term brand building over short-term results [58][60]

The furniture industry depends heavily on a strong economy and a vibrant housing market. When people are worried about money, they only replace furniture when they truly need to. Very few people buy a couch they don't need when they're worried about rising costs, losing their jobs, and general economic stress. The same logic applies to buying houses. When the housing market slows, fewer people need new furniture and date shows that the housing market has slowed. New single‑family home sales dropped sha ...

Economic Indicators - The Federal Reserve cut rates by 25 basis points, raised growth estimates, and lowered inflation projections, contributing to positive sentiment in the stock market [1] - Initial Jobless Claims rose to 236,000, the highest since the week after Labor Day, but this figure is roughly the median for new claims over the past year [2] - Continuing Claims dropped significantly to 1.838 million, the lowest since mid-April, indicating a potential positive trend in the labor market [3][4] - The U.S. Trade Balance improved, shrinking to a deficit of $52.8 billion, the lowest level since June 2020, and 60% lower than the record deficit in March [5] Company Earnings - Lovesac (LOVE) reported negative earnings of $0.72 per share, missing estimates, and its revenue of $150.17 million was down 2.37% from consensus, leading to a 14% drop in shares [6] - Broadcom (AVGO) is expected to see earnings growth of 31.7% and revenue growth of 24.5%, driven by AI infrastructure supply [7] - Costco (COST) is projected to achieve 11.5% earnings growth and 8.3% revenue growth [7] - Lululemon (LULU) is estimated to report a 22.7% decline in earnings, despite a 3.5% increase in revenues [7]

Economic Indicators - Initial Jobless Claims rose to +236K, the highest since +263K reported after Labor Day, following a previous drop to +192K, which was revised slightly higher [2] - Continuing Claims dropped significantly to 1.838 million from a revised 1.937 million, marking a -99K decrease week over week, the lowest since mid-April [3] - The long-term jobless claims remained above 1.9 million for 32 weeks without exceeding 2 million, indicating stability in the labor market [4] Trade Balance - The U.S. Trade Deficit decreased to -$52.8 billion, the lowest level since June 2020, down from a revised -$59.3 billion the previous month [5] - This figure is -60% lower than the record trade deficit set in March, attributed to preemptive actions by trade merchants ahead of tariff changes [5] Company Earnings - Lovesac (LOVE) reported negative earnings of -$0.72 per share, missing the anticipated -$0.70, and revenue of $150.17 million, down -2.37% from consensus, resulting in a -14% drop in shares [6] - Broadcom (AVGO) is expected to see earnings growth of +31.7% and revenue growth of +24.5%, driven by AI infrastructure supply [7] - Costco (COST) is projected to achieve +11.5% earnings growth with +8.3% revenue growth [7] - Lululemon (LULU) is estimated to report a -22.7% decline in earnings while revenues are expected to grow by +3.5% [8]

The Lovesac Company (NASDAQ:LOVE) stock fell Thursday after the company posted a wider quarterly loss and softer sales than expected.The retailer also tightened its full-year outlook as higher costs and weaker comparable sales pressured results.Lovesac reported a third-quarter EPS loss of 72 cents, missing Wall Street’s forecast for a 59-cent loss.Also Read: Stock Market Today: Dow Jones, S&P 500 Futures Slip Day After Fed’s Rate Cut—Oracle, Broadcom, Costco In FocusMetricsQuarterly sales of $150.166 millio ...

Core Insights - IKEA is planning to increase the volume of products sourced from US manufacturing facilities due to rising import costs from tariffs imposed during the Trump administration, marking a reversal of a long-term decline in domestic production for the US market [1][3] Group 1: Production and Sourcing Changes - Inter IKEA closed its manufacturing site in Danville, Virginia in 2019, leading to a decrease in domestically produced products sold in the US from 19% in 2014 to 15% [2] - Currently, 70% of IKEA's European sales and 80% of its Asian sales are sourced from regional manufacturing, highlighting a significant difference in sourcing strategies across regions [2] - The main sourcing countries for IKEA remain China, Germany, Italy, Lithuania, and Poland [2] Group 2: Operational Adjustments - The shift towards regional production was planned prior to the anticipated tariff increases in 2025, but has become more relevant due to price adjustments on certain products in the US to manage additional costs [3] - IKEA has experienced two consecutive years of declining sales and has been cutting prices to attract customers amid inflationary pressures [3] Group 3: New Manufacturing Initiatives - Lithuanian supplier SBA Home is expanding its output at a new manufacturing facility in Mocksville, North Carolina, with an investment of $70 million, aiming to produce up to two million furniture items annually, including KALLAX shelving units [4] - IKEA intends to increase purchasing from US-based suppliers, such as Sauder Woodworking, to support its sourcing strategy [4]

Industry Overview - The furniture retail industry is experiencing significant financial distress due to a slow residential real estate market, rising labor and product costs driven by inflation, increased tariff rates since April, and lingering effects from the Covid pandemic [1] - Several small and mid-size furniture chains have filed for bankruptcy protection this year, including Landmark Furniture parent Brenmark Inc., Walker Edison Furniture Company, American Mattress, and 5th Avenue Furniture [1] Company-Specific Developments - American Signature Inc., a 77-year-old furniture retailer operating 120 stores and employing 3,200 people, filed for Chapter 11 protection on Nov 22, seeking to reorganize its business and sell its assets to ASI Purchaser LLC after closing several stores [2] - Buddy's Home Furnishings franchisee, Buddy Mac Holdings LLC, along with 48 affiliates, filed for Chapter 11 bankruptcy protection on Dec 4 to halt foreclosure sales and either reorganize or seek a going-concern sale of its assets [4][5] - Buddy Mac Holdings listed assets and liabilities between $10 million and $50 million in its bankruptcy petition, with significant unsecured creditors including Buddy's Newco LLC and O'Rourke Sales Company, each owed over $1 million [6] - The company owed $12.6 million on a secured loan that originated in 2019, with an original principal balance of $26 million, which matured on Aug 31 and was sold to Phonix RBS LLC on Sept 2 [7] Bankruptcy Filings Timeline - American Signature, Inc. filed on Nov 22 - Landmark Furniture parent Brenmark Inc. filed on Nov 9 - Walker Edison Furniture Company filed on Aug 28 - American Mattress filed on July 6 - 5th Avenue Furniture filed on June 6, 2025 [8]