Vera Bradley, Inc. (VRA) Q3 2026 Earnings Call Transcript
Revenues $62.3 million, 11.7% below prior year. This compared to a 24.6% decline during the second quarter. Reasons for the decline include strategic product shifts and adjustments in promotional strategies.
Direct Business Segment Revenues $49.7 million, 5.3% below prior year compared to a decline of 16.2% in the second quarter. Sequential improvement in key metrics in nearly all direct segment channels, driven by product-led initiatives and positive comparable channel sales.
Net Loss from Continuing Operations Negative $8.3 million or negative $0.30 per diluted share, compared to negative $3.7 million or negative $0.13 per diluted share last year. The loss was significantly affected by a $5.9 million inventory write-down and a $4 million write-off of television media credits.
Gross Margin $26 million or 41.7% of net revenues, compared to $38.4 million or 54.5% of net revenues in the prior year. Excluding the inventory write-down, gross margin was 51.2%, showing sequential improvement. The decrease was due to inventory write-downs and additional duty expenses, partially offset by pricing improvements.
SG&A Expenses $37.4 million or 60.0% of net revenues, compared to $43.6 million or 61.8% of net revenues in the prior year. The decrease was due to lower compensation expenses and other cost reduction initiatives, partially offset by the media credit write-off.
Operating Loss from Continuing Operations Negative $11.1 million or negative 17.8% of net revenues, compared to negative $5 million or negative 7.1% of net revenues in the prior year. Excluding inventory reserve and media credits write-off, the operating loss was negative $1.2 million or negative 1.9% of net revenues.
Inventory $82.9 million, a 24.3% decrease year-over-year from $109.6 million. The decrease reflects strategic efforts to align receipts with sales expectations and optimize assortments.
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Music & Electronics Stores Shares Drop 1.5% Led by Upbound Group
- Market Underperformance: On Wednesday, shares of music and electronics stores collectively fell by approximately 1.5%, indicating challenges within the sector that may impact investor confidence and lead to capital outflows.
- Upbound Group Leads Decline: Upbound Group's stock dropped by about 4%, becoming the primary drag on the sector, highlighting potential operational pressures and intensified market competition risks.
- Vertiv Holdings Follows Suit: Vertiv Holdings saw a decline of approximately 1.8%, exacerbating concerns about the industry's future performance and potentially affecting its short-term financing capabilities.
- Overall Industry Trend: The downward trend in music and electronics stores may signal a slowdown in consumer spending, prompting businesses to reassess market strategies to navigate potential economic downturns.
Vera Bradley, Inc. Reports Reduced Losses in Q3
Third Quarter Loss: Vera Bradley, Inc. reported a loss of -$12.37 million for the third quarter, slightly improving from a loss of -$12.80 million in the same period last year.
Adjusted Earnings: Excluding certain items, the company reported adjusted earnings of -$8.31 million, or -$0.30 per share.
Revenue Decline: The company's revenue decreased by 11.7%, falling to $62.25 million from $70.48 million in the previous year.
Earnings Comparison: The earnings per share (EPS) for the quarter was -$0.44, compared to -$0.46 in the prior year.
Vera Bradley's Profit Margins Suffered More Than Its Famous Totes
Stock Performance: Vera Bradley, Inc. experienced a 20.47% drop in stock price to $1.71 after reporting a wider-than-expected adjusted third-quarter loss of 30 cents per share, despite quarterly sales exceeding expectations.
Sales and Revenue Decline: The company's direct segment revenues fell by 5.3% to $49.7 million, while indirect segment revenues saw a significant 30.2% decrease, primarily due to reduced orders in specialty and key accounts.
Margin and Profitability Issues: Gross profit decreased to $26.2 million, representing 42.1% of net revenues, down from 54.5% in the previous year, with an adjusted operating loss of $11.1 million compared to $5.0 million the prior year.
Future Outlook: Despite challenges, the relaunch of iconic styles has provided some optimism for the company's transformation strategy, branded as Project Sunshine, focusing on profitability and sustainable growth.
Vera Bradley Reports Q3 Revenue of $62.3M with Net Loss of $12.4M
- Revenue Performance: Vera Bradley reported third-quarter revenues of $62.3 million, an 8.8% decline from $70.5 million in the prior year, reflecting competitive pressures despite some product line returns boosting confidence.
- Net Loss Situation: The company incurred a net loss of $12.4 million, or $0.44 per share, primarily impacted by a $5.9 million inventory write-down and a $4 million write-off of media credits, highlighting financial challenges during the transformation process.
- Operational Efficiency: The Direct segment generated $49.7 million in revenue, a 5.3% decrease year-over-year, indicating improvements in overall sales but still facing issues with traffic and conversion rates that affect profitability.
- Long-term Strategy: Vera Bradley is implementing a five-pillar transformation strategy branded as
Vera Bradley (VRA) Third Quarter 2026 Earnings Call Transcript
- Author's Perspective: The views and opinions presented are solely those of the author.
- No Official Endorsement: The content does not necessarily reflect the views of Nasdaq, Inc.
Key Earnings Reports to Watch Before Thursday's Market Open
Major Earnings Announcements: Key earnings reports expected before the market opens on Thursday include Ciena Corporation, Imperial Petroleum, The Lovesac Company, and Manchester United.
Additional Earnings Releases: Other companies scheduled to release earnings before Thursday's open include DLMAF, LIVE, and VRA.
Earnings Season Calendar: For a comprehensive overview of the earnings season, readers can refer to Seeking Alpha's full earnings calendar.
Market Impact: These earnings announcements may influence market trends and investor decisions as they reflect the financial health of the respective companies.
Music & Electronics Stores Shares Drop 1.5% Led by Upbound Group
- Market Underperformance: On Wednesday, shares of music and electronics stores collectively fell by approximately 1.5%, indicating challenges within the sector that may impact investor confidence and lead to capital outflows.
- Upbound Group Leads Decline: Upbound Group's stock dropped by about 4%, becoming the primary drag on the sector, highlighting potential operational pressures and intensified market competition risks.
- Vertiv Holdings Follows Suit: Vertiv Holdings saw a decline of approximately 1.8%, exacerbating concerns about the industry's future performance and potentially affecting its short-term financing capabilities.
- Overall Industry Trend: The downward trend in music and electronics stores may signal a slowdown in consumer spending, prompting businesses to reassess market strategies to navigate potential economic downturns.
Vera Bradley, Inc. Reports Reduced Losses in Q3
Third Quarter Loss: Vera Bradley, Inc. reported a loss of -$12.37 million for the third quarter, slightly improving from a loss of -$12.80 million in the same period last year.
Adjusted Earnings: Excluding certain items, the company reported adjusted earnings of -$8.31 million, or -$0.30 per share.
Revenue Decline: The company's revenue decreased by 11.7%, falling to $62.25 million from $70.48 million in the previous year.
Earnings Comparison: The earnings per share (EPS) for the quarter was -$0.44, compared to -$0.46 in the prior year.
Vera Bradley's Profit Margins Suffered More Than Its Famous Totes
Stock Performance: Vera Bradley, Inc. experienced a 20.47% drop in stock price to $1.71 after reporting a wider-than-expected adjusted third-quarter loss of 30 cents per share, despite quarterly sales exceeding expectations.
Sales and Revenue Decline: The company's direct segment revenues fell by 5.3% to $49.7 million, while indirect segment revenues saw a significant 30.2% decrease, primarily due to reduced orders in specialty and key accounts.
Margin and Profitability Issues: Gross profit decreased to $26.2 million, representing 42.1% of net revenues, down from 54.5% in the previous year, with an adjusted operating loss of $11.1 million compared to $5.0 million the prior year.
Future Outlook: Despite challenges, the relaunch of iconic styles has provided some optimism for the company's transformation strategy, branded as Project Sunshine, focusing on profitability and sustainable growth.
Vera Bradley Reports Q3 Revenue of $62.3M with Net Loss of $12.4M
- Revenue Performance: Vera Bradley reported third-quarter revenues of $62.3 million, an 8.8% decline from $70.5 million in the prior year, reflecting competitive pressures despite some product line returns boosting confidence.
- Net Loss Situation: The company incurred a net loss of $12.4 million, or $0.44 per share, primarily impacted by a $5.9 million inventory write-down and a $4 million write-off of media credits, highlighting financial challenges during the transformation process.
- Operational Efficiency: The Direct segment generated $49.7 million in revenue, a 5.3% decrease year-over-year, indicating improvements in overall sales but still facing issues with traffic and conversion rates that affect profitability.
- Long-term Strategy: Vera Bradley is implementing a five-pillar transformation strategy branded as
Vera Bradley (VRA) Third Quarter 2026 Earnings Call Transcript
- Author's Perspective: The views and opinions presented are solely those of the author.
- No Official Endorsement: The content does not necessarily reflect the views of Nasdaq, Inc.
Key Earnings Reports to Watch Before Thursday's Market Open
Major Earnings Announcements: Key earnings reports expected before the market opens on Thursday include Ciena Corporation, Imperial Petroleum, The Lovesac Company, and Manchester United.
Additional Earnings Releases: Other companies scheduled to release earnings before Thursday's open include DLMAF, LIVE, and VRA.
Earnings Season Calendar: For a comprehensive overview of the earnings season, readers can refer to Seeking Alpha's full earnings calendar.
Market Impact: These earnings announcements may influence market trends and investor decisions as they reflect the financial health of the respective companies.
