Purple Innovation (PRPL) Misses Q1 EPS by 13c, Revenue Beat; Offers 2Q Revenue Outlook Below Consensus

Purple Innovation (NASDAQ: PRPL) reported Q1 EPS of ($0.17), $0.13 worse than the analyst estimate of ($0.04). Revenue for the quarter came in at $61 million versus the consensus estimate of $58 million.

First Quarter Financial Summary

• Net revenue increased 102.4% to $61.0 million, compared to $30.1 million in the first quarter of 2017.
• Gross margin was 43.3% as compared to 47.5% in the first quarter of 2017.
• Operating loss was $(2.9) million as compared to operating loss of $(2.0) million in the first quarter of 2017. Adjusted operating loss was $(0.6) million compared to adjusted operating loss of $(1.9) million in the first quarter of 2017.
• Net loss was $(3.6) million for the first quarter 2018 compared to a net loss of $(2.0) million in the year ago period.
• EBITDA was $(2.5) million compared to $(1.9) million in the first quarter of 2017. Adjusted EBITDA was $(0.1) million compared to $(1.9) million in the first quarter of 2017.

2018 Outlook

For the second quarter of 2018, the Company expects net revenue to be between $70.0 million and $73.0 million and adjusted EBITDA to be in the range of $(3.0) million to $(1.0) million.

For 2018, the Company now expects net revenue to be between $290.0 million and $310.0 million, an increase of between 47% and 57% over annual 2017, and adjusted EBITDA of approximately breakeven.

Terry Pearce added, " We continue to be very optimistic about the long-term prospects for Purple. In the near-term, we have adopted a more conservative top-line outlook to reflect increased pressure from online competition, lower online conversion rates in conjunction with the higher-priced models, and a slower than expected rollout of our wholesale business. Our revised revenue guidance is also based on the rising costs of digital advertising and marketing activities combined with our commitment to managing the business to breakeven on an adjusted EBITDA basis for 2018."

GUIDANCE:

Purple Innovation sees Q2 2018 revenue of $70-73 million, versus the consensus of $95.6 million.

For earnings history and earnings-related data on Purple Innovation (PRPL) click here.

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