La-Z-Boy Reports Slight Sales Increase but Decline in Profitability for Q2 Fiscal 2026

La-Z-Boy Incorporated reported its financial results for the second quarter and first six months of fiscal 2026, revealing a slight increase in sales but a decline in profitability compared to the previous year. For the quarter ended October 25, 2025, the company generated sales of $522.5 million, a marginal increase of 0.3% from $521.0 million in the same quarter of the prior year. However, net income attributable to La-Z-Boy decreased to $28.9 million, or $0.70 per diluted share, down from $30.0 million, or $0.71 per diluted share, in the prior year. For the first half of the fiscal year, sales totaled $1.014 billion, a slight decrease of 0.2% from $1.017 billion, while net income fell to $47.3 million from $56.7 million.

The company's operating income also saw a decline, with operating income for the second quarter at $36.2 million, down 6.7% from $38.8 million a year earlier. The decrease in profitability was attributed to increased supply chain costs and fixed cost deleverage in the Retail segment, which was impacted by lower same-store sales. The gross margin for the quarter decreased by 10 basis points to 44.3%, reflecting higher distribution costs and overhead in manufacturing operations, although partially offset by lower input costs.

In terms of strategic developments, La-Z-Boy did not complete any acquisitions during the first half of fiscal 2026 but announced a significant acquisition on October 28, 2025, of 15 independently owned La-Z-Boy Stores and four distribution centers in Atlanta, Northeast Florida, and Knoxville for $85.5 million. This acquisition is expected to enhance the company's retail presence and will be included in the Retail segment results starting in the third quarter of fiscal 2026. The company continues to focus on expanding its retail network and enhancing its omni-channel presence to drive growth.

Operationally, La-Z-Boy reported a total of 207 company-owned stores as of October 25, 2025, with a focus on upgrading existing locations and expanding its store count. The Retail segment's sales increased slightly, driven by store expansions and acquisitions, while the Wholesale segment experienced a 1.5% increase in sales, primarily due to strategic pricing actions. However, the Joybird brand, which operates under the Corporate and Other segment, reported a decline in sales, reflecting lower delivered volume.

Looking ahead, La-Z-Boy anticipates continued challenges in the macroeconomic environment affecting consumer demand, particularly in the Retail segment. The company remains committed to its Century Vision strategic plan, aiming to grow sales and market share while enhancing operating margins. The outlook includes ongoing investments in technology and supply chain capabilities to support growth initiatives and improve customer experience across its brands.