La-Z-Boy Reports 1.9% Sales Growth, 15.4% Operating Income Increase in Q2 Fiscal 2025

La-Z-Boy Incorporated reported a solid performance for the second quarter of fiscal 2025, ending October 26, 2024, with total sales reaching $521.0 million, a 1.9% increase from $511.4 million in the same quarter of the previous fiscal year. For the first six months of fiscal 2025, sales totaled $1.016 billion, up 2.4% from $993.1 million year-over-year. The company's gross profit for the quarter was $230.6 million, compared to $222.6 million in the prior year, reflecting a gross margin increase of 70 basis points.

Operating income for the second quarter rose to $38.8 million, a 15.4% increase from $33.6 million in the same period last year. The operating margin improved by 80 basis points, while net income attributable to La-Z-Boy increased to $30.0 million, up from $27.2 million a year earlier. Basic and diluted earnings per share also saw growth, reaching $0.72 and $0.71, respectively, compared to $0.63 in the prior year.

The Wholesale segment reported sales of $258.9 million, a slight decrease of 0.3% from $263.7 million, while the Retail segment experienced a 3% increase in sales to $221.6 million. The Corporate and Other segment saw a significant increase in sales, driven by Joybird, which contributed $38.7 million in the second quarter, up $6.3 million from the previous year.

Strategically, La-Z-Boy completed several acquisitions, including locations in Florida and Iowa, totaling approximately $19 million. These acquisitions are expected to enhance the company's retail presence and operational synergies. The company also reported a restructuring initiative that involved shifting production operations, resulting in severance-related expenses of $3.6 million and accelerated depreciation of $3.0 million.

On the balance sheet, total assets increased slightly to $1.928 billion, with total equity rising to $1.020 billion. However, cash and equivalents decreased to $303.1 million from $341.1 million at the end of the previous fiscal year. The company generated $68.3 million in net cash from operating activities, an increase from $56.9 million in the prior year, while cash used for investing activities rose significantly to $45.5 million.

Overall, La-Z-Boy's performance reflects a positive trajectory in sales and profitability, supported by strategic acquisitions and operational efficiencies, despite some challenges in the Wholesale segment.