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Dive Brief:
As Purple pushes forward with brick and mortar, its second quarter net revenue declined by 12.6% to $105.1 million, according to a company press release Tuesday. The company attributed the drop to “delays in the timing of Rejuvenate 2.0 shipments, lapping reductions in wholesale door count from 2024, and softness in ecommerce.”
The bed company’s net loss grew to about $17.4 million for the quarter from a $9 million loss the year before. Gross profit dropped about 23% to $37.7 million while operating expenses decreased 18.2% to $51.9 million.
Revenue dropped across Purple’s wholesale, e-commerce and showroom channels, per its Tuesday U.S. Securities and Exchange Commission filing. The company also reiterated its previous full-year guidance, expecting revenue to be in the range of $465 million to $485 million.
Dive Insight:
Purple is still betting on its showrooms — a channel the company previously called its toughest part of the business model.
“Our showrooms continue to play a key role in providing customers with a hands-on experience where our associates can engage and demonstrate the benefits of our products in a personalized setting,” CEO Rob DeMartini said on a call with analysts Tuesday.
The company launched a new Rejuvenate mattress collection in April with pricing starting at $4,999. Based on the line’s performance, Purple expects its showroom channel to become profitable in 2025, DeMartini said on the call.
Purple’s e-commerce strategy continues to evolve.
“In the past, our e-commerce was primarily focused on a more narrow segment of consumers who are willing to purchase a bed online in an industry where over 80% of consumers want to experience the mattress in person, particularly for premium-priced products,” the chief executive added. “Our e-commerce focus is expanding to include reinforcing the strength of the brand, clearly communicating the less pain, better sleep benefits of our technology and supporting premium positioning across all channels.”
Overall, the company’s second quarter took a hit from ever-changing tariff policies in the U.S., per DeMartini.
“Tariffs will continue to mitigate as we go forward,” CFO Todd Vogensen told analysts. “It’s a little bit of an uncertain environment to say the least. So we’re planning conservatively at this point.”