The Brand House Collective (KIRK) Q2 2025 earnings summary

Executive summary

• Q2 2024 net sales were $86.3 million, with comparable sales down 1.7%; store sales rose 1.8% while e-commerce declined 10.6%.

• Gross profit margin improved by 100 bps to 20.5% year-over-year, driven by higher merchandise margin and lower freight costs.

• Operating loss narrowed to $13.3 million, a $4.8 million improvement from Q2 2023, aided by reduced operating expenses.

• Net loss was $14.5 million ($1.11 per share), compared to $19.4 million ($1.51 per share) in the prior year quarter.

• Strategic initiatives and cost-saving measures are underway, including a review of strategic alternatives and reengagement of core customers.

Financial highlights

• Net sales were $86.3 million in Q2 2024, down from $89.5 million year-over-year.

• Gross profit: $17.7 million (20.5% margin), up from $17.4 million (19.5%).

• Adjusted EBITDA loss: $10.2 million, a $3.3 million improvement year-over-year.

• Operating expenses: $31.0 million (35.9% of sales), down from $35.5 million (39.7%).

• Inventory at quarter-end was $92.8 million, down 6.3% year-over-year.

Outlook and guidance

• Management expects $6 million in cost savings in Q2–Q4 2024 and $7 million in ongoing annual pre-tax savings.

• No specific guidance provided due to ongoing strategic review and forecasting challenges.

• Anticipates improved liquidity and sales in the second half, with positive Adjusted EBITDA targeted for 2024.

• Long-term goal remains $600 million in revenue and mid- to high-single-digit Adjusted EBITDA margin by 2028.