LIVE VENTURES Inc (LIVE)·Q3 2025 Earnings Summary

Executive Summary

• Fiscal Q3 2025 delivered strong profitability despite lower revenue: gross margin expanded 410 bps to 34.0%, operating income rose 607.6% YoY to $8.0M, and Adjusted EBITDA more than doubled to $13.2M, while revenue declined 9.2% YoY to $112.5M . Diluted EPS was $1.24, aided by $2.8M one-time gains (ERC and holdback settlement) .
• Sequential momentum: revenue improved to $112.5M from $107.0M in Q2, with continued cost reductions driving margin expansion and profitability gains across all segments .
• Liquidity strengthened: total cash availability rose to $37.1M, and the company repurchased 12,695 shares at $8.83 during the quarter; total assets were $387.5M and stockholders’ equity $94.3M as of June 30, 2025 .
• No formal guidance was provided; management emphasized ongoing cost actions, debt reduction, and opportunistic capital allocation (buybacks), with future dividends considered only after sustained performance and deleveraging .

What Went Well and What Went Wrong

What Went Well

• “Gross margins expanded by over 400 basis points to 34%, demonstrating the effectiveness of our strategic pricing initiatives and operational excellence programs” — Jon Isaac, CEO .
• Adjusted EBITDA more than doubled YoY to $13.2M; all four operating segments posted higher operating income and margin versus prior year, reflecting targeted cost reductions and pricing actions .
• Liquidity and execution: “Our operating cash flow increased 58% to $21.9 million for the nine months, providing us with excellent financial flexibility to pursue strategic growth opportunities” — Jon Isaac, CEO .

What Went Wrong

• Top-line pressure: revenue declined 9.2% YoY due to Retail-Flooring and Steel Manufacturing softness amid weak housing and demand; Retail-Flooring revenue fell 17.9% YoY .
• Retail-Flooring margins compressed (35.5% vs 36.6% YoY) on product mix, with segment still loss-making despite improvements from cost actions .
• Macro headwinds: management cited housing market weakness and interest rates impacting demand and renovations; steel volumes also pressured, though partially offset by Central Steel acquisition .

Financial Results

Segment Revenue (Q3 2025 vs Q3 2024)

Segment Operating Income (Q3 2025 vs Q3 2024)

Select KPIs and Balance Sheet

Non-GAAP/One-time items (context)

• Q3 2025 net income includes $1.5M ERC gain and $1.3M holdback settlement (total $2.8M), lifting EPS .
• Q2 2025 included a $22.8M gain on modification of the Flooring Liquidators seller note, boosting pre-tax income and EPS .
• Q1 2025 included $2.8M gain on earnout settlement and $0.7M gain on PMW seller notes .

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We delivered exceptional operational performance this quarter... Our gross margins expanded by over 400 basis points to 34%... These results validate our disciplined approach to cost management and operational optimization” — Jon Isaac, CEO .
• “All four of our operating segments delivered improved performance... despite ongoing softness in new home construction and refurbishment markets” — David Verret, CFO .
• “Our operating cash flow increased 58% to $21.9 million for the nine months... providing excellent financial flexibility” — Jon Isaac, CEO .

Q&A Highlights

• Operating improvements: Management sees further room to improve Retail-Flooring through leases and efficiencies; continuous evaluation across subsidiaries to extract efficiencies .
• Acquisition posture: Strategy remains opportunistic and sector-agnostic; prefer bolt-ons where teams know the space; flexible financing (bank, seller financing); use equity as currency if share price appreciates .
• Revenue outlook: Management avoided speculation; noted interest rates/housing softness and consumer disposable income as key variables; positioned to benefit from potential rate cuts .
• Tariffs: Minor impact to date; diversified sourcing to manage volatility; steel inventory could benefit if prices rise .
• Capital returns: Continued buybacks; dividends possible only after sustained improvement and debt reduction .

Estimates Context

• Wall Street consensus (S&P Global) coverage appears limited for LIVE this quarter; consensus EPS and revenue estimates were not available, so beat/miss analysis versus estimates cannot be provided. S&P Global consensus data unavailable for Q3 2025.

Key Takeaways for Investors

• Margin story over revenue: Gross margin expanded to 34.0% and Adjusted EBITDA doubled despite revenue −9.2% YoY; cost actions are clearly flowing through P&L .
• Segment mix matters: Entertainment and Steel are carrying profitability while Retail-Flooring and Flooring Manufacturing face macro headwinds; continued cost reductions and pricing actions stabilize overall margins .
• One-time gains boosted EPS in Q2 and Q3; normalize EPS for valuation work (Q2 seller note gain; Q3 ERC/holdback gains) .
• Liquidity improved and equity base strengthened: cash availability $37.1M; equity rose to $94.3M; working capital ~$65.9M supports flexibility for buybacks and selective M&A .
• Steel/AI tailwinds: Central Steel’s data center racking exposure positions LIVE to benefit from AI-driven infrastructure demand; pricing actions support margins .
• No formal guidance: Expect continued focus on SG&A and efficiency while macro dictates near-term revenue; dividends secondary to deleveraging and buybacks .
• Near-term trading lens: Watch housing/interest rate signals and steel pricing; narrative momentum on execution and margins could be a catalyst, but revenue reacceleration remains the swing factor .

Notes: Gross margin for Q1 and Q2 2025 are computed from reported revenue and gross profit figures in the company’s financial statements (citations provided in table cells). 

References:

• Q3 2025 press release and detailed financials
• Q3 2025 Item 2.02 8‑K with EX‑99.1 and segment detail
• Q3 2025 earnings call transcript
• Q2 2025 press release and financials
• Q1 2025 press release and financials