La-Z-Boy (LZB) Q2 2026 earnings summary

Executive summary

• Sales reached $522.5 million, up 0.3% year-over-year, with growth in Retail and Wholesale segments offset by a decline in Joybird sales.

• Wholesale segment led growth, with margin expansion and a 2% sales increase; retail delivered sales also increased slightly, though same-store sales declined due to lower consumer demand.

• Completed the largest independent store acquisition in company history, adding 15 stores in the Southeast U.S. and an estimated $80 million in annual retail sales.

• Announced exit from non-core businesses and closure of the U.K. manufacturing facility, with all actions expected to complete by fiscal year-end.

• Opened five new company-owned stores in the quarter, totaling 15 new stores in the last 12 months.

Financial highlights

• Consolidated GAAP operating income was $36.2 million (6.9% margin), adjusted operating income was $37.1 million (7.1% margin), both down year-over-year.

• Diluted EPS was $0.70 GAAP and $0.71 adjusted, flat year-over-year.

• Operating cash flow for the quarter was $50 million, triple the prior year; year-to-date operating cash flow was $86 million.

• Ended the quarter with $339 million in cash and no externally funded debt.

• Gross profit was $231.1 million, nearly flat year-over-year.

Outlook and guidance

• Fiscal Q3 sales expected between $525–545 million, up 1–4% year-over-year.

• Adjusted operating margin for Q3 projected at 5–6.5%, reflecting ongoing transformation and friction costs.

• Plan to open approximately 15 new La-Z-Boy stores and 3–4 new Joybird stores in fiscal 2026.

• Capital expenditures for fiscal 2026 expected at $90–$100 million.

• Strategic initiatives expected to result in a $30 million net sales decrease but 75–100 basis points improvement in adjusted operating margin.