Leslie's, Inc. Reports $51.3 Million Net Loss and Revenue Decline in Latest Quarter

Leslie's, Inc. reported a net loss of $51.3 million for the three months ended March 29, 2025, compared to a net loss of $34.6 million in the same period last year, marking an increase of 48.7%. For the six months, the net loss was $95.9 million, up from $74.1 million in the prior year. Revenue for the quarter was $177.1 million, a decrease of 6.1% from $188.7 million in the previous year, primarily driven by lower transaction volumes and a less favorable product mix. The company's gross profit also declined to $43.9 million, down 19.1% year-over-year, resulting in a gross margin of 24.8%, compared to 28.8% in the prior year.

In terms of operational metrics, Leslie's reported a comparable sales decline of 6.7% for the quarter, with non-comparable sales contributing only $0.9 million. The company operated 1,020 locations at the end of the reporting period, a slight increase from 1,010 locations a year earlier. Selling, general, and administrative expenses rose to $92.3 million, an increase of 8.8% from the previous year, largely due to higher compensation and professional fees. Interest expenses decreased to $15.9 million from $18.2 million, reflecting lower interest rates and reduced debt balances.

The company continues to face challenges, including increased costs associated with occupancy and distribution, which have impacted profitability. Leslie's has also been navigating a complex macroeconomic environment characterized by inflation and changing consumer behaviors. The company’s liquidity position has been affected, with cash and cash equivalents dropping to $17.3 million from $108.5 million at the end of the previous fiscal year. As of March 29, 2025, Leslie's had $101.5 million outstanding on its revolving credit facility, a significant increase from the previous period.

Looking ahead, Leslie's management remains focused on executing its growth strategies, which include expanding its physical and digital presence in the pool and spa care market. The company holds a market share of approximately 15% in the residential aftermarket product segment and aims to leverage its extensive network of locations and e-commerce capabilities to enhance customer engagement and drive sales. However, the company has acknowledged the potential for continued volatility in its financial performance due to external factors such as weather conditions, supply chain disruptions, and economic uncertainties.