Lulu's Fashion Lounge Holdings, Inc. (LVLU)·Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 revenue was $66.1M (-12% y/y), gross margin 37.9% (-120 bps y/y), and GAAP diluted EPS of $(0.76); results reflect softness in casual wear and a non-cash $28.4M goodwill impairment that drove a net loss of $31.9M (ex-impairment net loss ~$3.5M) .
• Cost actions were tangible: Q4 selling, marketing, and G&A were down $5.5M y/y (-15%) and management completed consolidation of West Coast distribution in Feb-25 to further streamline costs .
• 2025 outlook sets a reset baseline: net revenue $280–$310M (down 11% to 2% vs 2024), Adjusted EBITDA $0–$6M, capex $2.5–$3.0M, positive operating cash flow including Q1; net debt targeted at $3–$4M exiting Q1 as the company pursues refinancing into an ABL by June 15, 2025 .
• Mix shift remains the story: double-digit growth in special occasion/bridesmaid/bridal was offset by casual weakness; wholesale momentum strong (+76% y/y in Q4) with new partners (Nuuly, Poshmark, Von Maur) and deeper ties with Dillard’s and Nordstrom .
• Relative to S&P consensus, Q4 revenue modestly missed while EPS was better than feared; focus items for stock reaction: execution on tariff mitigation, wholesale ramp durability, margin recapture from lower markdowns, and the timing/terms of the planned refinancing (ABL) . Values retrieved from S&P Global.*

What Went Well and What Went Wrong

What Went Well

• “We delivered positive sales growth in our special occasion, bridesmaid, and bridal categories,” reinforcing leadership in event dressing despite a seasonally slower Q4 .
• Wholesale strength: Q4 wholesale revenue grew 76% y/y; new partnerships with Nuuly, Poshmark, Von Maur; expanded presence at Dillard’s and Nordstrom .
• Cost discipline: Q4 SM&A and G&A down $5.5M y/y (-15%); distribution consolidation completed in Feb-25; second-half 2024 opex -19% vs first-half 2024 .

What Went Wrong

• Casual wear softness continued, driving the majority of the y/y net sales decline; AOV fell 5% to $129 in Q4 (from $136) .
• Gross margin compressed 120 bps y/y to 37.9% on higher markdowns/promotions to maintain inventory health and election-related demand softness; deleverage on a smaller revenue base also weighed on profitability .
• Goodwill impairment ($28.4M) resulted in a larger GAAP net loss ($31.9M) in Q4; ex-impairment net loss was $3.5M, the narrowest in six quarters but still negative .

Financial Results

GAAP results vs prior quarters (oldest → newest)

KPIs (oldest → newest)

Performance vs Wall Street (S&P Global) – Estimates vs Actuals

Values retrieved from S&P Global.*

• Q4: Revenue miss vs est.; EPS better than est. (less negative). Q3: Revenue beat; EPS miss. Q2: Revenue slight beat; EPS miss. Values retrieved from S&P Global.*

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• CEO on Q4 category performance and focus: “We delivered positive sales growth in our special occasion, bridesmaid, and bridal categories… These gains… were offset by continued softness in casual wear, which we are actively repositioning” .
• CEO on cost and operations: “We successfully completed the consolidation of our West Coast distribution facilities in late February 2025” .
• CFO on cost reductions: “Selling, marketing, and general and administrative expenses in Q4 were $5.5 million lower year-over-year, a 15% decline…” .
• CFO on profitability cadence: “Excluding the goodwill impairment, our net loss was $3.5 million,” the narrowest quarterly loss of the past six quarters .
• CEO on tariffs and mitigation: “Our full year guidance contemplates the known tariffs… accelerating our direct sourcing efforts… intended to mitigate tariff pressures” .

Q&A Highlights

• The published Q4 2024 transcript provided prepared remarks but did not include a detailed Q&A section; management addressed key investor topics in prepared comments: (1) tariff mitigation and sourcing diversification, (2) cost structure resets and distribution consolidation, (3) liquidity and planned ABL refinancing by June 15, 2025, and (4) wholesale/channel expansion .

Estimates Context

• Q4 2024 vs S&P consensus: Revenue $66.15M vs $68.65M (miss); EPS $(2.24) vs $(2.85) (better than feared). Prior quarters saw Q3 revenue beat/EPS miss and Q2 revenue slight beat/EPS miss. Values retrieved from S&P Global.*

Key Takeaways for Investors

• Eventwear engine intact; casual reset ongoing—near-term revenue pressure likely until assortments realign and reorder funnel improves .
• Wholesale is a bright spot with outsized growth and new partnerships, expanding reach at modest capital intensity .
• Cost structure is leaner; distribution consolidation and opex reductions should aid operating leverage as revenue stabilizes .
• 2025 targets imply profitability inflection (Adjusted EBITDA $0–$6M) and positive operating cash flow, contingent on margin expansion (lower markdowns, direct-to-factory) and demand stabilization .
• Tariffs are a known headwind; mitigation through pricing, vendor sharing, and sourcing diversification will be critical to protect gross margin .
• Balance sheet transition: limited revolver capacity today; execution on ABL refinancing by mid-2025 is a key de-risking catalyst .
• Watch for margin trajectory (markdown normalization, return rate improvements) and wholesale sell-through as near-term stock drivers .

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References:

• Q4/FY24 press release and 8-K exhibits (financials, KPIs, outlook) .
• Q4 2024 earnings call prepared remarks (strategy, tariffs, wholesale, cost actions, refinancing) .
• Prior quarters for trend analysis: Q3 2024 8-K/PR/Call ; Q2 2024 8-K/PR/Call .

S&P Global consensus and actuals used for estimate comparisons. Values retrieved from S&P Global.*