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LEHI, Utah – Purple Innovation, Inc. (NASDAQ: NASDAQ:), a leader in comfort technology, reported a narrower-than-expected loss for the fourth quarter, with earnings per share (EPS) of -$0.15, surpassing analyst estimates by $0.03. The company’s revenue for the quarter was $145.9 million, slightly above the consensus estimate of $145.56 million, marking a 1.1% increase from the same quarter last year.
Despite the slight beat on EPS and revenue, Purple Innovation’s stock experienced a 4.41% decline. The company provided its full-year 2024 revenue guidance in the range of $540 to $560 million, with the midpoint falling slightly below the consensus estimate of $546.6 million.
The fourth quarter saw a modest year-over-year (YoY) revenue growth, attributed to the successful introduction of new products and increased advertising spend. Direct-to-Consumer (DTC) revenue grew by 4.3%, while wholesale revenue declined by 2.7%. The company’s gross margin decreased to 33.2% from 34.6% YoY, with adjusted gross margin at 36.7%.
Operating expenses for Q4 rose to $64.7 million, up from $61.9 million in the prior year, mainly due to a $4.0 million increase in advertising to support the new product launch. The operating loss widened to -$16.2 million, compared to -$11.9 million in the fourth quarter of the previous year. The net loss improved significantly to -$18.3 million from -$71.7 million YoY, and adjusted net loss was -$15.8 million, or -$0.15 per adjusted diluted share, compared to -$8.1 million, or -$0.09 per adjusted diluted share, in the same quarter last year.
CEO Rob DeMartini expressed optimism about the company’s progress, highlighting the improved sales trends and strategic initiatives aimed at driving productivity, efficiency, and innovation. He noted, “The fourth quarter represented an encouraging finish to 2023 as sales finished within our guidance range and increased year-over-year for the first time in eight quarters.”
Looking forward, Purple Innovation anticipates adjusted EBITDA for 2024 to be between -$20 million and -$10 million, with expectations of positive adjusted EBITDA in the second half of the year. The company’s focus remains on capturing market share, repositioning as a premium brand, and laying the foundation for long-term, profitable growth.
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