Build-A-Bear Reports $51.8M Net Income and $460.3M Revenue for Fiscal Year Ending February 2025

Build-A-Bear Workshop, Inc. reported a consolidated net income of $51.8 million for the fiscal year ending February 1, 2025, a slight decrease from $52.8 million in the previous fiscal year. Total revenues reached $460.3 million, reflecting a modest increase of $4.2 million or 0.9% compared to the prior year. The growth in revenue was primarily driven by an increase in sales from corporately-operated retail locations, which benefited from a rise in transaction volume, despite a decrease in e-commerce demand. The company also opened nine new corporately-managed locations during the fiscal year, contributing to its overall revenue growth.

In terms of operational metrics, Build-A-Bear's North American stores generated an average net retail sales per store of $1.2 million, consistent with figures from the previous two fiscal years. The company ended the fiscal year with 368 corporately-managed locations, 138 partner-operated locations, and 83 international franchise stores, marking a net growth of 64 experience locations. The company’s inventory balance increased to $69.8 million, up by $6.3 million from the previous year, as it accelerated inventory purchases in anticipation of potential cost increases due to tariffs.

Strategically, Build-A-Bear has focused on expanding its retail footprint beyond traditional mall locations, with a significant portion of its stores now situated in non-traditional settings such as tourist destinations. The company has also initiated a digital transformation aimed at enhancing its e-commerce capabilities and customer engagement through loyalty programs and digital content. In September 2024, Build-A-Bear appointed a Chief Revenue Officer to align its operational structure with its digital strategy, reflecting its commitment to adapting to changing consumer preferences.

The company has faced challenges from inflation, particularly in labor costs, which have impacted its operational expenses. Selling, general, and administrative expenses rose to $206.2 million, or 41.5% of total revenue, driven by increased store-level wages and higher outside service costs. Despite these pressures, Build-A-Bear maintained a strong gross profit margin of 54.9%, up from 54.4% in the previous year, attributed to lower merchandise and freight costs.

Looking ahead, Build-A-Bear anticipates continued revenue growth, with plans to open at least 50 new locations in fiscal 2025. The company remains vigilant regarding inflationary pressures and potential tariff impacts on its cost structure. It aims to leverage its brand strength and expand its product offerings to attract a broader consumer base, including teens and adults, while maintaining a focus on enhancing its omnichannel retail experience.