Specialty sleep supplier Purple Innovation said second-quarter sales rose 2% to $120.3 million as the company benefitted from a significant increase in wholesale floor slots and a positive response to several new products.
The company said wholesale revenues jumped 7.2% during the quarter, while direct-to-consumer revenues were down 1.8%.
The top-line growth, coupled with a variety of expense reductions, enabled Purple to break even in the quarter, reversing a net loss of $40.49 million in last year’s second quarter.
“Our second quarter results underscore the progress we’ve made enhancing the financial profile of the company,” said CEO Rob DeMartini. “Even as industry trends further deteriorated and impacted demand, we exceeded our adjusted EBITDA plan thanks to a number of operational improvements and cost saving programs that drove a significant increase in gross margins on both a year-over-year and sequential basis.”
Gross margin in the most recent quarter was 40.7%, up from 30.1% in last year’s second quarter.
“We remain on track for a return to profitability in the second half of the year and are confident that our Path to Premium Sleep strategy will continue to gain traction in the marketplace, allowing us to take share and deliver value to our shareholders,” DeMartini added.
Despite the optimism, the company reduced its sales projection for the year to a range of $490 million to $510 million. That’s down from a May projection of $540 million to $560 million.
Purple didn’t offer a projection on earnings per share, but said it expected adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization, to be negative $10 million to negative $20 million.
For the first six months of 2024, sales rose 7% to $240.3 million. The six-month net loss totaled $50.2 million, or 47 cents per share. In the first half of 2023, the net loss was $66.4 million, or 65 cents per share.