Vera Bradley, Inc. (NASDAQ:VRA) stock fell 4.64% (As on December 12, 11:34:32 AM UTC-4, Source: Google Finance) after the company reported a fiscal third-quarter net loss of $12.8 million, compared to net income of $5.1 million during the same period last year. The third quarter was extremely challenging as we remained in the early stages of ‘Project Restoration’, the strategic initiative to transform the business model and transition Vera Bradley’s brand positioning. With the launch of the Holiday assortments late in the third quarter, and the strategic promotional adjustments the company executed, the company is experiencing a steady trendline improvement across the majority of the Vera Bradley direct-to-consumer channels in Q4, as well as in the wholesale channel. The company is seeing strong customer response to heritage prints, key giftable price point products and continued success in the elevated product offerings.

Meanwhile, Vera Bradley Direct segment revenues totaled $52.5 million, a 27.4% decrease year over year. Comparable sales declined 27.2% in the third quarter, with weakness in all direct channels. Vera Bradley Indirect segment revenues totaled $18.0 million, a 27.9% decrease year over year. The decrease was primarily related to a decline in specialty and key account orders. Pura Vida segment revenues totaled $10.1 million, a 42.9% decrease from $17.7 million in the prior year’s third quarter.

Further, the third-quarter consolidated gross profit was $43.6 million, down from $63.0 million a year ago. Gross margin was 54.1% of net revenues, slightly contracting from 54.8% last year. The decrease in gross profit percentage was due to sales channel mix and a rise in outbound freight costs. Cash and cash equivalents as of November 2, 2024 totaled $13.7 million compared to $52.3 million at the end of last year’s third quarter. The Company had no borrowings on its $75 million asset-based lending (“ABL”) facility at quarter end.

VRA in the third quarter of FY 24 has reported the adjusted loss per share of 27 cents, missing the analysts’ estimates for the adjusted earnings per share of 12 cents. The company had reported the adjusted revenue decline of 30 percent to $80.58 million in the third quarter of FY 24, missing the analysts’ estimates for revenue of $98.7 million.

Vera Bradley expects FY25 revenues to be $385 million (prior view $410 million), falling short of the $410.02 million estimate, and projects consolidated EPS of approximately $0.25 loss (prior view $0.10) versus the $0.10 estimate.