Ethan Allen Reports Positive Fiscal 2025 Third Quarter Results Despite Challenging Environment

Ethan Allen Interiors Inc. (“Ethan Allen” or the “Company”), a leading interior design destination, reported its results for the fiscal 2025 third quarter ended March 31, 2025.

Farooq Kathwari, Ethan Allen’s Chairman, President and CEO commented, “Our vertically integrated enterprise, including our interior design retail network, relevant product offerings and ability to manufacture about 75% of our furniture in our own North American facilities, has provided us a strategic advantage.”

“We are pleased with our third quarter results, which produced a strong gross margin, positive operating cash flow and total cash and investments of $183.0 million with no outstanding debt. These results reflect our ability to operate in an industry faced with reciprocal and retaliatory tariffs, uncertainty in the economy, elevated interest rates and a challenging housing market, that together, have impacted consumer confidence and interest in the home,” continued Mr. Kathwari.

“For the quarter ended March 31, 2025, we reported consolidated net sales of $142.7 million, gross margin of 61.2%, adjusted operating income of $11.3 million, adjusted operating margin of 8.0% and adjusted diluted EPS of $0.38. We generated $10.2 million in cash from operations, which helped us grow our total cash and investments by $1.9 million from a year ago. We continued our history of returning capital to shareholders by paying a regular quarterly cash dividend of $10.0 million during the third quarter and are pleased to announce that today our Board approved a regular quarterly cash dividend of $0.39 per share, payable on May 29, 2025.”

Mr. Kathwari further commented, “we continue to strengthen various areas of our enterprise, including our talent, product offerings, marketing, retail network, manufacturing, logistics, technology and social responsibility. We are thankful for the continued hard work and support of our 3,294 talented and dedicated associates, who have greatly benefited from ongoing investments in technology, and helped us lower headcount by 35.7% since 2019. We look forward to continued progress and remain cautiously optimistic.”

Founded in 1932, Ethan Allen owns and operates U.S. manufacturing plants in Vermont and North Carolina while operating an upholstery plant in Mexico and a case goods plant in Honduras. Centering business operations closer to its customer has helped Ethan Allen become a leading interior design destination while earning recognition for its exceptional quality and service, having twice been named America’s #1 Premium Furniture Retailer by Newsweek.

“To provide additional perspective on our current strong position, a brief overview of our history. Ethan Allen was founded 93 years ago in the Green Mountains of Vermont. The Company went private in 1989 with significant debt and in 1993 went public on the New York Stock Exchange. Since that time, we have paid cash dividends totaling $711.3 million and repurchased $625.1 million of our common stock. In addition, by leveraging ongoing investments in technology, we have reduced our headcount from 5,120 as of March 31, 2019 to 3,294 today,” concluded Mr. Kathwari.

Fiscal 2025 Third Quarter Highlights*

• Consolidated net sales of $142.7 million; prior year $146.4 million
  • Wholesale net sales of $99.0 million; prior year $89.8 million
  • Retail net sales of $117.6 million; prior year $122.6 million
• Written orders
  • Wholesale segment written orders declined 11.2%
  • Retail segment written orders decreased 13.0%
• Consolidated gross margin of 61.2%; prior year 61.3%
• Operating margin of 7.7%; adjusted operating margin of 8.0% compared with 10.0% last year
• Advertising expenses were equal to 3.4% of consolidated net sales, consistent with the prior year
• Diluted EPS of $0.37; adjusted diluted EPS of $0.38 compared with $0.48 last year
• Generated $10.2 million of cash from operating activities; prior year $23.7 million
• Paid cash dividends totaling $10.0 million or $0.39 per share, up 8.3% from a year ago
• Ended the quarter with $183.0 million in total cash and investments with no outstanding debt
• Inventory carrying levels totaled $150.4 million at March 31, 2025, up $8.3 million since June 30, 2024
• Ended the quarter with 3,294 employees, down 4.5% from a year ago and 35.7% less than March 2019
• Operated 174 Ethan Allen retail design centers in North America at March 31, 2025, including 143 Company-operated and 31 independently owned and operated locations; the Company also has design centers outside of North America
• Opened new retail design centers in Middleton, Wisconsin and Toronto, Canada during the quarter that showcase the Company’s home furnishings while combining complimentary interior design services with technology
• For the sixth consecutive year, Ethan Allen’s upholstery operations in Silao, Mexico was recognized as “Empresa Socialmente Responsible” (Environmentally and Socially Responsible)

* See reconciliation of GAAP to adjusted key financial measures in the back of this release. Comparisons are to the fiscal 2024 third quarter.

Balance Sheet and Cash Flow

Cash and investments totaled $183.0 million at March 31, 2025, compared with $195.8 million at June 30, 2024 and $181.1 million a year ago. The decrease during the first nine months of fiscal 2025 was due to $40.1 million in cash dividends paid and capital expenditures of $9.4 million partially offset by $36.9 million in cash generated from operating activities.

Cash from operating activities totaled $36.9 million during fiscal 2025, a decrease from $54.0 million in the prior year period due to lower net income and changes in working capital. Changes in working capital reflect an increase in inventory within the retail segment combined with the timing of software technology payments.

Cash dividends paid during fiscal 2025 totaled $40.1 million, which included a special cash dividend of $10.2 million, or $0.40 per share, and regular quarterly cash dividends totaling $29.9 million, or $0.39 per share, an 8.3% increase from last year’s regular quarterly dividend.

Inventories, net totaled $150.4 million at March 31, 2025, an increase of $8.3 million since June 30, 2024. The introduction of new products and the opening of new design centers led to higher inventory levels within the Company’s retail segment.

Customer deposits from undelivered written orders totaled $79.3 million at March 31, 2025, up from $73.5 million at June 30, 2024 due to timing of incoming orders. Wholesale backlog was $54.6 million at March 31, 2025, a decline of $3.1 million during the quarter, which helped reduce the number of weeks of backlog.

No debt outstanding at March 31, 2025.

Dividends

On January 28, 2025, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.39 per share, which was paid on February 26, 2025. More recently, on May 5, 2025, the Board of Directors declared a regular quarterly cash dividend of $0.39 per share, payable on May 29, 2025 to shareholders of record as of May 15, 2025. Ethan Allen is pleased to pay a regular quarterly cash dividend, which highlights its strong balance sheet and operating results.

For the full third quarter results, click here.

About Ethan Allen

Ethan Allen (NYSE:ETD), named America’s #1 Premium Furniture Retailer by Newsweek, is a leading interior design destination combining state-of-the-art technology with personal service. Ethan Allen design centers, which represent a mix of Company-operated and independent licensee locations, offer complimentary interior design service and sell a full range of home furnishings, including custom furniture and artisan-crafted accents for every room in the home. Vertically integrated from product design through logistics, the Company manufactures about 75% of its custom-crafted furniture in its own North American manufacturing facilities and has been recognized for product quality and craftsmanship since 1932. Learn more at www.ethanallen.com and follow Ethan Allen on Facebook, Instagram, and LinkedIn.

Contact:

Matt McNulty – Senior Vice President, Chief Financial Officer and Treasurer – IR@ethanallen.com

Source: Ethan Allen Interiors, Inc.