Meet&Co
DANBURY, Conn. — Ethan Allen, a Top 100 home furnishings retailer, reported modest declines in net sales and a sharper drop in profit for its fiscal third quarter, though gross margins remained steady.
For the quarter ended March 31, consolidated net sales slipped 2.5% year over year to $142.7 million. While wholesale net sales rose 10.2% to $99 million, that growth was offset by a 4% drop in retail sales, which totaled $117.6 million.
Customer demand softened across the board, with written orders down 11.2% in the wholesale segment and 13% in the retail segment.
Despite the decline in profitability, gross margin held nearly flat at 61.2%, compared with 61.3% in the same quarter last year.
CEO Farooq Kathwari highlighted the company’s healthy balance sheet, positive operating cash flow, and $183.9 million in cash and investments, noting these as signs of stability in a tough economic climate marked by high interest rates, tariffs, and a sluggish housing market.
Operating income dropped 33.3% to $10.2 million, while net income fell 25.8% to $9.6 million. Diluted earnings per share were $0.38, down from $0.48 in Q3 of the prior year.
Ethan Allen ended the quarter with inventory valued at $150.4 million, up $8.3 million since June 30, 2024, as the company expanded its product assortment and opened new design centers, driving up retail inventory levels.
