Shares of The Lovesac Company (NASDAQ:LOVE) surged about 18% in pre-market trading on Thursday after the furniture retailer reported fourth-quarter results that exceeded Wall Street expectations.
Investors reacted positively to the company’s performance despite ongoing macroeconomic pressures affecting the retail sector.
For the quarter ended February 1, 2026, Lovesac posted adjusted earnings per share of $2.19, slightly above the analyst consensus estimate of $2.18. Revenue totaled $248 million, beating forecasts of $242.8 million and rising 2.7% from $241.5 million recorded in the same quarter a year earlier.
“Despite a challenging macro environment in fiscal 2026 marked by tariff pressures, economic uncertainty, and intense promotional activity across our category, we adapted effectively and drove meaningful progress on our strategic goals,” said Shawn Nelson, Chief Executive Officer.
For the full fiscal year 2026, net sales increased 2.4% to $697.1 million compared with $680.6 million in fiscal 2025. However, profitability declined, with net income falling 64.8% to $4.1 million, or $0.28 per diluted share, from $11.6 million, or $0.69 per diluted share, in the previous year.
Gross margin also narrowed, dropping 210 basis points to 56.4% from 58.5%, primarily due to higher inbound shipping costs and tariffs.
Looking ahead, the company expects first-quarter fiscal 2027 revenue to range between $133 million and $139 million, with a midpoint forecast of $136 million. It anticipates a loss per share between $0.95 and $1.22 during the period.
For the full fiscal year 2027, Lovesac projects revenue of $700 million to $750 million, with a midpoint estimate of $725 million. Earnings per share for the year are expected to fall between $0.34 and $0.95, with a midpoint of $0.65.
The company finished the quarter with $101.9 million in cash and no outstanding debt. Its board also approved an additional $40 million share repurchase authorization, increasing total buyback capacity to about $54.1 million.