Culp, Inc. Reports Decline in Net Sales and Net Loss for Third Quarter

Culp, Inc. reported its financial results for the third quarter and nine months ended February 1, 2026, revealing a decline in net sales and a net loss, although the company showed signs of operational improvement. For the third quarter, net sales totaled $47.965 million, down 8.2% from $52.253 million in the same period last year. The nine-month figures also reflected a decrease, with sales of $151.859 million compared to $164.464 million, marking a 7.7% decline. The company recorded a net loss of $3.432 million for the third quarter, an improvement from a loss of $4.126 million in the prior year, while the nine-month net loss was $7.969 million, significantly reduced from $17.031 million in the previous year.

The decrease in sales was attributed to challenging market conditions, including reduced consumer spending and adverse weather that impacted shipping. The bedding segment experienced a slight decline in sales of 4.7% for the quarter, while the upholstery segment saw a more significant drop of 12.4%. Despite these challenges, Culp noted growth in its sewn mattress cover product category and continued efforts to secure new programs with major customers, indicating potential stabilization in demand.

Operationally, Culp has been undergoing significant restructuring, including the consolidation of its North American bedding operations and the integration of its upholstery segment. The company reported a restructuring credit of $2.425 million for the nine-month period, primarily due to a gain from the sale of a manufacturing facility in Quebec, Canada. This restructuring is expected to enhance operational efficiency and reduce costs, with the company aiming to leverage its global footprint and U.S. manufacturing capabilities to improve its market position.

As of February 1, 2026, Culp's cash and cash equivalents stood at $9.687 million, an increase from $5.279 million at the end of the previous fiscal year. The company has also increased its borrowings under lines of credit to $18.533 million, reflecting its strategy to manage liquidity amid ongoing market pressures. Looking ahead, Culp remains cautiously optimistic about future growth, contingent on a recovery in housing activity and consumer spending, while continuing to navigate the complexities of the current economic landscape.