Purple Innovation (PRPL) Misses Q4 EPS by 33c, Revenues Beat; Offers FY20 Revenue Guidance Above Consensus

Purple Innovation (NASDAQ: PRPL) reported Q4 EPS of ($0.29), $0.33 worse than the analyst estimate of $0.04. Revenue for the quarter came in at $124.3 million versus the consensus estimate of $119.52 million.

Fourth Quarter Financial Summary (Comparisons versus Fourth Quarter 2018)1

• Net revenue increased 58.3% to $124.3 million, compared to $78.5 million.
• Gross margin was 47.7% compared to 34.2%.
• Operating expenses as a percent of net revenue were 45.4% compared to 40.8%.
• Operating income was $2.8 million compared to an operating loss of $(5.2) million. Adjusted operating income was $3.9 million compared to an adjusted operating loss of $(4.3) million.
• Net loss was $(12.7) million compared to a net loss of $(5.4) million. The fourth quarter 2019 included a $13.4 million non-cash loss associated with the change in fair value of warrant liabilities.
• EBITDA was $(9.3) million compared to $(4.5) million. Adjusted EBITDA was $5.8 million compared to $(3.7) million.

"We delivered outstanding financial results in 2019 highlighted by revenue growth of 50% and a significant improvement in our balance sheet," said Joe Megibow, Chief Executive Officer. "The combination of our top-line performance, significant gross margin expansion, and meaningful expense leverage, fueled a dramatic improvement in operating profit compared with 2018. We believe our differentiated product offering and enhanced marketing programs are driving increased traffic to our e-commerce website, company operated showrooms and retail partner doors. At the same time, we believe the improvements we've made to our manufacturing, supply chain, and fulfillment functions have created a foundation to support profitable growth. Overall, we have great momentum as 2020 gets underway and remain very excited about our growth prospects for the current year and beyond."

"We continued to experience robust growth in the fourth quarter highlighted by an acceleration in direct to consumer sales," continued Megibow. "It was a very successful holiday season driven by effective marketing and promotions that fueled consumer demand and expanded awareness of our brand and product offering. Our performance reflects the progress we are making executing our strategic initiatives and I am confident that we are well positioned to build on our recent accomplishments and generate increased shareholder value over the long-term."

GUIDANCE:

Purple Innovation sees FY2020 revenue of $550-575 million, versus the consensus of $540.93 million.

For the full year 2020, the Company currently expects;

• Net revenue of $550 million to $575 million.
• Adjusted EBITDA of $44 million to $49 million.
• CapEx of approximately $40 million.

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

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