Hooker Furnishings Corporation (NASDAQ:HOFT) reported fiscal second-quarter adjusted earnings above analyst expectations, while revenue came in below consensus and declined from the prior-year period.
Adjusted earnings per share were $0.15, compared with an analyst estimate for a loss of $0.01 per share. Revenue was $63.25 million, below the $68.01 million consensus estimate.
Shares rose 10.31% in premarket trading following the results.
Net sales declined 8.7% year on year to $63.25 million, which the company attributed to lower unit volumes and increased promotional discounts.
Tariff Recoveries Contribute to Gross Margin Increase
Hooker Furnishings received $7.9 million in tariff recoveries during the quarter after the US Supreme Court invalidated certain tariffs imposed under the International Emergency Economic Powers Act.
Continuing operations recognised approximately $4.3 million of the recoveries as a reduction in cost of sales and $0.2 million in related interest income. These benefits were partly offset by approximately $0.5 million of customer credits.
Gross margin increased to 31.8% from 24.9% in the prior-year quarter, primarily reflecting the tariff recoveries.
Operating income was $1.3 million, compared with an operating loss of $0.5 million a year earlier.
“We are encouraged to report $1.7 million in consolidated net income for the quarter, marking our third consecutive quarter of profitability and a $4.9 million improvement over the prior-year second quarter,” Chief Executive Officer Jeremy Hoff said.
“These results were achieved despite a challenging demand environment characterized by continued weakness in housing activity, low consumer confidence and lower seasonal demand we typically experience in the first half of our fiscal year.”
Hooker Branded and Domestic Upholstery Report Operating Profits
The Hooker Branded segment reported operating income of $870,000. Gross margin increased by 1,050 basis points to 39.6%, while net sales declined 4.5% to $34.6 million.
Domestic Upholstery recorded operating income of $833,000, compared with an operating loss of $408,000 in the prior-year period. Gross margin increased by 450 basis points to 23.0%.
Consolidated backlog reached $42.4 million, up 6.2% year on year, with the increase led by the Hooker Branded and Domestic Upholstery businesses.
Cash and cash equivalents increased to $18.7 million from $1.1 million at the end of fiscal 2026. The company reported no outstanding term loan balance.
Hooker Furnishings stock price
