Vera Bradley Hurt By Stubborn Macro Headwinds In Q2, Stock Plummets

Vera Bradley, Inc. VRA shares are trading lower on Wednesday.

The company reported that the second quarter adjusted earnings per share was 13 cents, missing the street view of 21 cents. Quarterly revenues of $110.82 million missed the analyst consensus of $123.01 million.

“Our results for the period were also influenced by stubbornly persistent macro consumer headwinds that masked key successes across several areas of our business turnaround, as we registered top-line trends similar to the first quarter,” said Jackie Ardrey, Chief Executive Officer.

Vera Bradley Direct segment revenues totaled $72.2 million, a 15.7% decrease from $85.7 million in the prior year second quarter. Comparable sales declined 11.2% in the second quarter, with weakness in all direct channels.

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Vera Bradley Indirect segment revenues totaled $21.8 million, a 25.3% increase over $17.4 million in the prior year second quarter. The increase was primarily related to an increase in sales to key accounts as well as an increase in liquidation sales.

Pura Vida segment revenues totaled $16.8 million, a 33% decrease from $25.1 million in the prior year, attributed to a decrease in both ecommerce and wholesale sales, partially offset by new store growth. 

In the second quarter, consolidated gross profit was $56.4 million, or 50.9% of net revenues, down from $72.0 million, or 56.2% last year. The drop was due to more liquidation sales and increased promotions.

Cash and equivalents as of August 3 totaled $44.1 million.

Outlook: Vera Bradley forecasts fiscal year 2025 revenues of $410 million, below the $452.15 million estimate and the prior range of $460 million to $480 million, and projects consolidated diluted EPS of approximately $0.10, compared to the $0.35 estimate and the previous range of $0.54 to $0.62.

Price Action: VRA shares are trading lower by 10.2% to $4.47 premarket at last check Wednesday.

Photo via Wikimedia Commons

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