Specialty mattress producer Purple Innovation said first-quarter sales tumbled 13.2% to $104.2 million as the company continued to experience weak demand in its wholesale and e-commerce channels.
However, its gross margin of 39.4% was higher than last year’s first quarter due largely to reduced operating expenses. Plus, the company slashed its net loss to $19.1 million, or 18 cents per share, from $50.2 million, or 47 cents per share, in the same quarter last year.
“Our first quarter performance reflects continued progress against our strategic priorities to stabilize and strengthen the business, and position Purple for long-term success,” said Rob DeMartini, CEO. He said sales were in line with expectations, and noted the company experienced growth in its chain of company-owned retail showrooms.
“Though the current economic environment remains uncertain, including the evolving impact of tariffs, we believe the structural improvements we have achieved, and investments we have made across innovation and partnership expansion, position us to navigate near-term pressures and deliver sustained growth over time,” DeMartini added.
He said a key element of Purple’s growth plans is a new supply agreement signed with Mattress Firm, which is now owned by Somnigroup International (formerly Tempur Sealy International,)
Under terms of the agreement, Purple will more than double its footprint in Mattress Firm stores nationwide through the second half of 2025. The company currently has about 5,000 mattress slots at the retailer but will have a minimum of 12,000 slots as part of the new agreement.
The agreement also expands an existing supply arrangement with Tempur Sherwood LLC, a Somnigroup subsidiary that will have the exclusive right to assemble certain product lines that Purple sells to Mattress Firm.
DeMartini said Purple will maintain production of its proprietary gel grid technology and retain all related intellectual property.
Purple reiterated its sales and earnings estimates for the 2025 calendar year. The company is projecting sales of $465 million to $485 million, and says adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) will range from break-even to a positive $10 million.
Adjusted EBITDA for the first quarter was a negative $4.7 million, an improvement over a negative $13.2 million in last year’s first quarter.
