La-Z-Boy Reports Second Quarter Financial Results

November 18, 2025  by Karen Parrish in Business Strategy, Industry   

Fiscal 2026 Second Quarter Highlights:

Delivered sales of $522 million, up slightly from prior year period

Retail segment written sales increased 4%

Same-store sales trends improved sequentially

Opened five new company-owned stores (and closed three); opened 15 new stores in the last 12 months (and closed five)

Wholesale segment delivered sales increased 2%

Consolidated two additional distribution centers as part of distribution and home delivery transformation

GAAP operating margin of 6.9% and adjusted⁽¹⁾ operating margin of 7.1%

GAAP diluted EPS of $0.70 and adjusted⁽¹⁾ diluted EPS of $0.71

Generated $50 million in operating cash flow for the quarter, triple last year's comparable period

Quarterly dividend increased 10% to $0.242, the 5^th consecutive year of double-digit increases

Additional Strategic Initiatives:

Completed 15-store acquisition in southeast U.S. region; adding an estimated $80 million in annual Retail sales (approximately $40 million net to enterprise)

Announced planned exit of non-core businesses (Kincaid and American Drew casegoods and Kincaid upholstery)

Announced proposed closure of UK manufacturing facility

Strategically realigned leadership and corporate staffing to focus on core businesses

To be substantially completed by the end of the fiscal year, these initiatives combined will reduce sales by approximately $30 million, net, and increase margins by 75-100 bps

For the quarter, sales totaled $522 million, up slightly against the prior year comparable period, reflecting growth in Retail and Wholesale segments, offset by a decline in Joybird sales. Operating margin was 6.9% for the quarter on a GAAP basis and 7.1% on an adjusted⁽¹⁾ basis. Diluted earnings per share totaled $0.70 on a GAAP basis and $0.71 on an adjusted⁽¹⁾ basis.

Second quarter total written sales for the Retail segment (company-owned La-Z-Boy stores) grew 4% versus a year ago and written same-store sales (which exclude the impact of both newly opened stores and newly acquired stores) were down 2%. This represents a continued sequential improvement in written same-store sales trends over the last two quarters against a challenging consumer and macroeconomic environment.

Melinda D. Whittington, board chair, president and chief executive officer of La-Z-Boy Incorporated, said, “We were pleased to deliver modest sales growth, particularly in our Wholesale segment where we also again delivered margin expansion, continuing to create our own momentum in what remains a choppy landscape.”

“We are investing in the business for the long term, as highlighted by the opening of 15 new company-owned stores in the last 12 months and the advancement of our distribution and home delivery transformation project. Furthermore, in the beginning of our third quarter, we completed the previously announced acquisition of a 15-store network in the southeast U.S. region. Our Century Vision strategy to grow our Retail store footprint and expand brand reach is working and positions us to disproportionately benefit when overall industry volumes rebound.”

Whittington added, “In addition to investing in our core, vertically integrated North American upholstery business, we are proactively taking steps to optimize our portfolio. We have announced plans to exit our non-core wholesale casegoods and upholstery businesses in the back half of the fiscal year, announced the proposed closure of our U.K. manufacturing facility, and strategically realigned our commercial leadership and corporate staffing to enhance operating efficiency.”

“On top of this, leveraging our North American manufacturing base with ~90% of finished goods produced in the U.S., we are successfully navigating the current trade and tariff volatility. Our iconic brand, well positioned manufacturing base, strong balance sheet, and talented team provide the foundation for continued growth and margin expansion,” she concluded.

Third Quarter Outlook:
Taylor Luebke, SVP and chief financial officer of La-Z-Boy Incorporated, said, “We expect fiscal third quarter sales to be in the range of $525-545 million (growth of 1-4% year-over-year) and adjusted operating margin⁽²⁾ to be in the range of 5.0-6.5%, reflecting advancement of our Century Vision initiatives, friction costs related to portfolio and supply chain optimizations, and a measured view on the uncertain macroeconomic backdrop.”

Fiscal 2026 Second Quarter Results versus Fiscal 2025 Second Quarter:

Consolidated sales in the second quarter of fiscal 2026 increased slightly to $522 million versus last year, as modest growth in our Retail and Wholesale business were offset by lower delivered volume in our Joybird business

Consolidated GAAP operating margin was 6.9% versus 7.4%

Consolidated adjusted⁽¹⁾ operating margin was 7.1% versus 7.5% last year, with change due to deleverage in Retail delivered same-store sales and investment in new stores, partially offset by 110 basis point benefit of lower warranty expense due to a change in our dealer warranty arrangements during the quarter

GAAP diluted EPS was $0.70 versus $0.71 in the prior year period and adjusted⁽¹⁾ diluted EPS was flat at $0.71 versus $0.71 last year in the comparable period

Dividend:
On November 18, 2025, the Board of Directors declared a quarterly cash dividend of $0.242 per share on the common stock of the company, a 10% increase over the previous dividend. This represents the 5^th consecutive year of double-digit increases to the dividend. The dividend will be paid on December 15, 2025, to shareholders of record on December 4, 2025.

Conference Call:
La-Z-Boy is holding a conference call with the investment community on Nov 19, 2025, at 8:30 a.m. ET. The toll-free dial-in number is (888) 506-0062; international callers may use (973) 528-0011. Enter Participant Access Code: 973736.

The call will be webcast live, with corresponding slides, and archived on the internet. It will be available at https://lazboy.gcs-web.com/. A telephone replay will be available for a week following the call. This replay will be accessible to callers from the U.S. and Canada at (877) 481-4010 and to international callers at (919) 882-2331. Enter Replay Passcode: 53154. The webcast replay will be available for one year.