Vera Bradley, Inc. (NASDAQ:VRA) stock rose 6.19% (As on September 12, 11:25:32 AM UTC-4, Source: Google Finance) after the company posted lower than expected results for he second quarter of FY 26. The company saw sequential improvement in comparable store sales across its stores and online for each month of Q2 2026. Direct segment revenues totaled $60.5 million, a 16.2% decrease from $72.2 million in the prior year second quarter. Comparable sales declined 17.3% in the second quarter, primarily driven by conversion declines in our full-line, outlet, and e-commerce channels. During the second quarter, the Company closed seven underperforming full-line stores and one underperforming outlet store. Vera Bradley Indirect segment revenues totaled $10.3 million, a 52.5% decrease over $21.8 million in the prior year second quarter. The decrease was primarily related to a decline in key account orders, as well as reduced liquidation sales. On a non-GAAP basis, the Company’s current year operating loss from continuing operations totaled ($0.6) million, or (0.8%) of net revenues, compared to operating income from continuing operations of $3.3 million, or 3.5% of net revenues, in the prior year.

Moreover, gross profit totaled $35.5 million, or 50.1% of net revenues, compared to $46.7 million, or 49.7% of net revenues, in the prior year. The year over year increase in consolidated gross profit as a percentage of net revenues in the second quarter resulted from a decrease in liquidation sales, partially offset by channel shifts that resulted in higher shipping costs. Gross margin improved sequentially by 600 basis points over the first quarter, including the 360 basis point benefit from PO cancellations and professional fees recorded in the first quarter.

VRA in the second quarter of FY 26 has reported the adjusted loss per share of $0.02, missing the analysts’ estimates for the adjusted loss per share of $0.15, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue decline of 25 percent to $70.86 million in the second quarter of FY 26, missing the analysts’ estimates for revenue by 9.76% Cash and cash equivalents as of August 2, 2025 totaled $15.2 million compared to $29.3 million at the end of last year’s second quarter. The Company had borrowings of $10.0 million on its $75.0 million asset-based lending (“ABL”) facility at quarter end. The Company had no borrowings on its ABL facility at the end of last year’s second quarter. Total quarter-end inventory was $96.7 million, compared to $111.4 million at the end of last year’s second quarter. Net capital spending for the second quarter totaled $2.6 million compared to $3.6 million in the prior year.