Sign in

You're signed outSign in or to get full access.

HF

HOOKER FURNISHINGS Corp (HOFT)·Q4 2025 Earnings Summary

Executive Summary

  • Fiscal Q4 2025 net sales were $104.46M, up 8% YoY aided by a 14-week quarter; diluted EPS was -$0.22 vs $0.06 prior-year, reflecting $3.1M of charges (inventory write-downs, tradename impairment, bad debt, severance) .
  • Revenue modestly beat S&P Global consensus ($104.46M actual vs $101.16M estimate*), but EPS missed materially (-$0.22 actual vs $0.155 estimate*) as non-cash/tranched charges weighed; operating margin improved sequentially to -2.5% from -7.0% in Q3 * .
  • Management announced an additional $8–$10M annualized cost savings, bringing total programs to $18–$20M when fully annualized in FY2027; Savannah DC exit expected to yield $0.8–$1.0M in FY2026 and $4.0–$5.7M annual beginning FY2027, with $3.0–$4.0M of net charges in FY2026 .
  • Segment dynamics: Hooker Branded unit volume +14% with orders +15% YoY; Home Meridian gross margin reached 22.9% (best since 2016) despite charges; Domestic Upholstery orders +13% but posted a $2.5M operating loss on lower volume .
  • Potential stock catalysts: execution on cost-reduction ramp and Vietnam warehouse start-up, tariff-policy clarity, and continued market-share gains from the “collective living” merchandising strategy .

What Went Well and What Went Wrong

What Went Well

  • Hooker Branded and Home Meridian delivered underlying sales increases even after normalizing for the extra week; unit volumes improved and orders rose (+15% at Hooker Branded) .
  • HMI gross margin reached 22.9%—highest since 2016—supported by focus on profitable lines and hospitality strength; strategic exit of low-margin businesses improving mix .
  • Cost-out program expanded: cumulative $18–$20M annualized savings targeted by FY2027; Vietnam warehouse expected to enhance product flow, container mixing, and margins .

What Went Wrong

  • Consolidated EPS swung to -$0.22 vs $0.06 prior-year due to $3.1M of Q4 charges, including bad-debt tied to a large customer bankruptcy and tradename impairment .
  • Domestic Upholstery softness drove a $2.5M operating loss on lower volume and under-absorbed overhead; backlog declined YoY (down 4%) .
  • Macro headwinds persisted—weak housing, lower consumer confidence, tariff uncertainty—pressuring demand and elevating operating complexity (direct-container margin risk) .

Financial Results

MetricQ4 2024Q3 2025Q4 2025
Net Sales ($USD Millions)$96.775 $104.352 $104.460
Diluted EPS ($USD)$0.06 -$0.39 -$0.22
Operating Income ($USD Millions)$0.340 -$7.260 -$2.655
Operating Margin %0.4% -7.0% -2.5%
Segment Net Sales ($USD Millions)Q4 2024Q4 2025
Hooker Branded$37.654 $41.421
Home Meridian$29.015 $35.323
Domestic Upholstery$28.272 $26.306
All Other$1.834 $1.410
Consolidated$96.775 $104.460
KPIsQ4 2024Q4 2025
Consolidated Order Backlog ($USD Thousands)$71,824 $52,636
Hooker Branded Backlog ($USD Thousands)$15,416 $11,984
Home Meridian Backlog ($USD Thousands)$36,013 $21,002
Domestic Upholstery Backlog ($USD Thousands)$18,920 $18,123
Cash & Equivalents at FY-end ($USD Millions)$43.159 $6.295
Available Borrowing Capacity ($USD Millions)N/A$41 (as of FY-end; $19M cash and $41M capacity “as of yesterday”)

Estimate comparison:

MetricConsensus* (Q4 2025)Actual (Q4 2025)
Revenue ($USD)$101.16M*$104.46M
Primary EPS ($USD)$0.155*-$0.22
# of EPS Estimates2*N/A
# of Revenue Estimates2*N/A
Values retrieved from S&P Global.*

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total Annualized Cost SavingsFY2026–FY2027$10M announced in FY2025Additional $8–$10M; total $18–$20M annualized when fully implemented; completion anticipated by 2H FY2026; full annualized in FY2027 Raised
Savannah DC Exit – Net ChargesFY2026N/A$3.0–$4.0M net charges expected New
Savannah DC Exit – Cost Savings (Net in Year 1)FY2026N/A$0.8–$1.0M net savings depending on timing New
Savannah DC Exit – Annualized SavingsFY2027N/A$4.0–$5.7M per year New
Dividend per ShareQ4 2025$0.23 paid prior quarter$0.23 declared, payable Mar 31, 2025 Maintained

Earnings Call Themes & Trends

TopicQ2 FY25 (Sep 2024)Q3 FY25 (Dec 2024)Q4 FY25 (Apr 2025)Trend
Cost ReductionInitiated $10M plan; workforce reductions; expect to exceed target Seeing efficiencies; savings to spread evenly next year Added $8–$10M, total $18–$20M; pacing towards FY2027 Accelerating
Merchandising/“Collective Living”Re-merchandising led by Chief Creative Officer; positive previews Strong October High Point placements; pre-cut collections Two new collections driving unit volume; strategy praised Building momentum
Supply Chain/InventoryFocused inventory mgmt; CapEx deferrals; strong cash resources Strategic inventory build to mitigate Lunar New Year/port strike risks Vietnam warehouse to reduce safety stock, enable container mixing Improving resilience
Tariffs/MacroHousing downturn; potential rate cuts could aid demand Macro indicators improving; sentiment up Tariff uncertainty; 90-day pause allows nimble inventory; housing weak Mixed; policy-sensitive
Segment PerformanceHMI gross margin 19.5%; hospitality strength; Sunset West expansion HMI 20.5% GM; hospitality up; Hooker Branded inventory build HMI 22.9% GM; Branded orders +15%; Domestic orders +13% Sequential improvement
Market SharePositioning for growth; backlog focus Post-election order bump; share tracking Share gains in first three quarters; expect continuation Positive trajectory

Management Commentary

  • “Excluding these charges, our financial performance improved sequentially each quarter throughout the year.” — CEO Jeremy Hoff .
  • “We gained market share at Hooker Legacy in every quarter of fiscal 2025 through the third quarter… reinforces the competitive advantages we've built.” — CEO Jeremy Hoff .
  • “When fully operational, we believe the Vietnam warehouse will reduce domestic safety stock needs, improve product flow, enable container mixing, and support margin expansion.” — CEO Jeremy Hoff .
  • “We strategically increased inventory in the fourth quarter to support three major new casegoods collections and replenish our most profitable, high-velocity items.” — CFO Earl Armstrong .
  • “Tariffs add tremendous complexity and uncertainty… require us to look at our cost structure more aggressively, particularly on the lower margin, direct container side of our business.” — CEO Jeremy Hoff .

Q&A Highlights

  • Hooker Branded traction: Two new collections from October market drove early placements and unit volume; management declined to comment on Q1 intra-quarter specifics .
  • Domestic Upholstery opportunity: Tariff backdrop seen as tailwind for domestic manufacturing; capacity available at Bradington-Young and HF Custom .
  • HMI margins: Focus on profitable programs (Pulaski, Samuel Lawrence) with exit from low-margin accents; Savannah exit reduces warehousing costs; margin outlook tied to sales growth .
  • Inventory/tariff pause: 90-day pause enables nimble inventory staging using Vietnam warehouse to shorten lead times (4–6 weeks) and avoid over-commitment .
  • Cost-savings pacing: Company spending targeted to decline from ~$109M to ~$89–$91M over this year (inclusive of Savannah), roughly back to FY22 levels .

Estimates Context

  • Q4 2025 revenue beat: Actual $104.46M vs consensus $101.16M*; EPS missed: -$0.22 vs $0.155*. Two estimates on EPS and revenue contributed to consensus*. Values retrieved from S&P Global.*
  • Near-term estimate sensitivity: Continued charges (Savannah exit in FY2026), tariff path, and cost-savings ramp suggest EPS estimates may need downward revision short term while revenue estimates could stabilize with merchandising and hospitality strength .

Key Takeaways for Investors

  • Execution on the $18–$20M annualized cost-savings and Savannah exit is the near-term earnings driver; watch for 2H FY2026 benefits and full annualization in FY2027 .
  • Revenue resilience anchored by merchandising upgrades and hospitality; Hooker Branded orders and unit volume trends are key leading indicators into FY2026 .
  • Margin mix is improving at HMI (22.9% GM), but consolidated EPS remains sensitive to charges and macro; sequential operating margin improvement (-7.0% to -2.5%) signals progress .
  • Tariff policy path is a swing factor; Vietnam warehouse and domestic upholstery capacity provide hedges against supply chain and tariff shocks .
  • Balance sheet flexibility: Despite lower year-end cash ($6.3M), liquidity remains with $41M revolver capacity and recent refinancing; dividend maintained at $0.23, signaling confidence .
  • Trading implications: Expect stock to react to visibility on cost-savings cadence and tariff developments; earnings beats likely tied to margin execution and hospitality demand stabilization .
  • Medium-term thesis: Market-share gains, “collective living” merchandising, and logistics optimization (Vietnam warehouse) can expand margins and drive profitable growth when housing cycles turn .

Notes and Sources:

  • FY Q4 2025 8-K and press release with full financials and segment detail .
  • Earnings call transcript Q4 2025 for qualitative and Q&A detail .
  • Additional Q4 window press releases: Savannah DC exit ; dividend declaration .
  • Prior quarters for trend analysis: Q3 FY2025 8-K and press release ; Q2 FY2025 8-K and call .
  • Estimates: S&P Global consensus via GetEstimates; values marked with asterisk are retrieved from S&P Global.*