Haverty Furniture ((HVT)) has held its Q3 earnings call. Read on for the main highlights of the call.
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In the latest earnings call, Haverty Furniture showcased a blend of optimism and caution. The company reported robust sales growth and successful marketing strategies, yet these achievements were somewhat overshadowed by rising costs, tariff impacts, and prevailing market challenges. This dual sentiment highlights the company’s resilience and adaptability in a challenging economic landscape.
Sales Growth and Positive Comps
Haverty Furniture reported impressive sales growth in Q3 2025, with total sales reaching $194.5 million, marking a 10.6% increase from the previous year. Comparable store sales also saw a healthy rise of 7.1%, underscoring the company’s strong market presence and effective sales strategies.
Strong Gross Margins
Despite facing LIFO expenses, Haverty’s managed to slightly increase its gross margins to 60.3% from 60.2% in the previous year. This marginal improvement reflects the company’s ability to maintain profitability amidst rising costs.
Successful Labor Day Event
The Labor Day event emerged as a significant success for Haverty’s, recording a 13.6% increase in written sales compared to the previous year. This event was pivotal in driving the company’s sales growth for the quarter.
E-Commerce and Marketing Success
Haverty’s e-commerce segment flourished, with sales growing by 13.6%. The company’s first direct mail campaign in years proved effective, attracting a new wave of customers and enhancing its market reach.
Expansion Plans
The company expanded its footprint by opening a new store in Houston, bringing the total store count to 129. With plans for further expansion in 2026, Haverty’s is poised to strengthen its market position.
Decreased Operating Margin
While sales and gross margins improved, the operating margin saw a decline to 3.3% from 3.9% in Q3 2024. This decrease was accompanied by a slight dip in pretax profits, highlighting the impact of increased operational costs.
Impact of Tariffs
New tariffs on imported goods, particularly from Mexico and Vietnam, are anticipated to elevate costs and LIFO expenses. This development poses a challenge to maintaining cost efficiency.
Increased SG&A Expenses
Haverty’s reported an 11.3% increase in SG&A expenses, driven primarily by higher advertising and administrative costs. This rise reflects the company’s investment in marketing and operational infrastructure.
Economic and Market Challenges
The broader economic environment remains challenging, with high interest rates, rising home prices, and geopolitical tensions affecting market dynamics. These factors continue to pose hurdles for Haverty’s growth ambitions.
Forward-Looking Guidance
Looking ahead, Haverty’s remains optimistic about its growth trajectory. The company expects gross margins to range between 60.4% and 60.7% for 2025, with SG&A expenses projected to be between $296 million and $298 million. Plans to open new stores and enhance customer experience are central to its future strategy, despite the challenges posed by tariffs and economic conditions.
In conclusion, Haverty Furniture’s earnings call painted a picture of a company navigating through a complex market environment with resilience and strategic foresight. While strong sales growth and effective marketing strategies are commendable, the impact of rising costs and market challenges cannot be overlooked. Haverty’s forward-looking guidance reflects cautious optimism, with plans for expansion and continued investment in customer experience poised to drive future growth.