Lovesac Co (NASDAQ:LOVE) stock fell 4.93% (As on April 11, 11:26:03 AM UTC-4, Source: Google Finance) after the company gave downbeat forecast and gave lower than expected results for the fourth quarter of FY 23. Gross profit increased $15.9 million, or 11.9%, to $149.6 million in the fourth quarter of fiscal 2024 from $133.7 million in the prior year period. Gross margin increased 360 basis points to 59.7% of net sales in the fourth quarter of fiscal 2024 from 56.1% of net sales in the prior year period primarily driven by a decrease of 550 basis points in inbound transportation costs, partially offset by an increase of 100 basis points in outbound transportation and warehousing costs and a decrease of 90 basis points in product margin driven by higher promotional discounting. Operating income was $40.4 million in the fourth quarter of fiscal 2024 compared to $36.5 million in the prior year period. Operating margin was 16.0% of net sales in the fourth quarter of fiscal 2024 compared to 15.4% of net sales in the prior year period. Net income was $31.0 million in the fourth quarter of fiscal 2024 compared to $26.2 million, in the prior year period.

LOVE in the fourth quarter of FY 23 has reported the adjusted earnings per share of 32 cents, missing the analysts’ estimates for the adjusted earnings per share of 49 cents. The company had reported the adjusted revenue growth of 5 percent to $5.63 billion in the fourth quarter of FY 23, missing the analysts’ estimates for revenue of $5.79 billion. This is primarily driven by growth within our Showroom and Internet channels. Showroom net sales, which include kiosks and mobile concierges, increased 10.9%. Internet net sales increased 2.2%, and our “Other” channel which principally includes pop-up-shops and shop-in-shops decreased 24.6%. The increase in net sales was driven by new showroom openings, partially offset by a decrease of 4.1% in omni-channel comparable net sales. During the fourth quarter ended February 4, 2024, we opened 2 additional showrooms and closed 1 showroom and 1 kiosk.

The company Co sees Q1 net sales in range of $126 mln to $132 mln, below Wall Street view of $147.50 mln, according toLSEG data. The company expects FY25 EPS to be in the range of $1.06 to $1.59 while analysts anticipate EPS of $2.15. The company forecasts Q1 basic loss/share to be between 84 cents to $1.03; analysts on average forecast loss/share of 15 cents.