Ethan Allen Reports $579.5M in Net Sales, 5.7% Decline for Fiscal Year Ending June 30, 2026

Ethan Allen Interiors Inc. reported a consolidated net sales figure of $579.5 million for the fiscal year ending June 30, 2026, reflecting a decrease of 5.7% compared to the previous year’s sales of $614.6 million. The decline was attributed to lower contract sales, a reduction in delivered unit volume, and fewer incoming orders, which resulted in a decrease in available backlog. Despite these challenges, the company achieved a gross margin of 61.2%, an improvement from 60.5% in the prior year, primarily due to a favorable sales mix and lower inbound freight costs. However, the operating margin fell to 7.8% from 10.1% in the previous year, largely due to the impact of tariffs and reduced sales volume.

In terms of strategic developments, Ethan Allen opened four new Company-operated design centers in Colorado Springs, Concord (Canada), San Diego, and Vancouver during fiscal 2026, bringing the total number of retail design centers to 171, including 141 Company-operated and 30 independently owned locations. The company continues to focus on enhancing its product offerings, with significant growth in categories such as Home Accents, Lighting, and Outdoor products. The total employee count decreased by 4.6% to 3,062, with reductions in both the wholesale and retail segments, reflecting ongoing efforts to optimize operational efficiency.

Ethan Allen's financial performance was also impacted by a significant reduction in contract sales, particularly with the U.S. government, which saw a 56% decline due to fewer incoming orders and the effects of a government shutdown. The wholesale backlog decreased by 9.3% to $44.3 million, indicating a slowdown in orders. The company reported diluted earnings per share of $1.56, down from $2.01 in the prior year, as net income fell to $39.9 million from $51.6 million.

Looking ahead, Ethan Allen remains focused on its strategic initiatives, including leveraging its vertical integration to enhance production efficiencies and maintain quality. The company anticipates continued challenges in the macroeconomic environment, including inflation and fluctuating consumer demand, but is committed to navigating these conditions through disciplined cost management and strategic pricing adjustments. The company’s robust balance sheet, with total cash and investments of $187.5 million, positions it well for future growth and shareholder returns, including ongoing dividend payments and share repurchases.