by Decrease was led by decline in retail revenue and partially offset by slight increase in wholesale revenue
BASSETT, Va. — Bassett Furniture reported a drop in revenue for its first quarter ended Feb. 28 that was largely related to a decline in retail sales during the period.
Consolidated revenues totaled $80.3 million, down 2.2% from $82.2 million the same period last year. Retail revenue was down 1.4% while wholesale revenue was up .1%.
Net income totaled $1.1 million, or 13 cents per share, compared with $1.86 million, or 21 cents per share, last year.
Gross profit was $45.2 million, or 56.2% of net sales, compared with $46.8 million, or 57% of sales, last year.
Operating income was $1.2 million, or 1.4% of sales, compared with operating income of $2.5 million, or 3% of sales, the same period last year.
On the wholesale side of the business, operating income was $8.4 million, or 15.8% of sales, compared with $8.7 million, or 16.4% of sales, last year. The retail segment reported an operating loss of $1 million compared with zero operating income reported last year.
SG&A expenses for the quarter totaled $43.9 million, or 54.7% of sales, compared with $44.4 million, or 54% of sales, last year.
“After a solid start to the first seven weeks of fiscal 2026, the pace of business slowed abruptly in mid-January,” said Rob Spilman, chairman and chief executive officer. “As a result, consolidated sales declined by 2.2% for the quarter.”
“On the macro front, demand continues to suffer from the stubbornly weak residential housing market,” he added. “Amidst that backdrop, severe weather occurring over the last two weekends of January essentially shut down normal operations at many of our retail stores and warehouses. The timing of the bad weather was especially unfortunate as the back half of January is usually a strong sales period. On the positive side, retail written sales for our Presidents Day event rebounded nicely, producing a double-digit sales increase for the promotion. Ultimately, retail written sales were flat for the quarter.
“Wholesale margins were down slightly, primarily due to volume declines in our domestic upholstery operations. Bassett Casegoods, on the other hand, posted a 12.1% sales gain and improved margins. Retail margins were significantly affected by our decision to absorb tariffs in retail pricing during the fourth quarter of 2025, which are delivered in Q1. Pricing for the second quarter forward now includes the tariffs at retail and wholesale.”
He added, “At some point, we believe that the housing market will rebound and drive demand more in line with historical experience. With that in mind, we are making measured cash investments to grow our business. We are committed to our omnichannel model as e-commerce sales increased by 28% in the quarter.”
He said a new Cincinnati store is under construction and that the company will begin work on its new Orlando location in early April.
“This fall, we will move into a new showroom location in High Point, and extensive renovations are already taking place to that space,” he added. “As we invest, we strive to seek the proper balance between investment in future top-line expansion and managing ongoing expenses. Accordingly, our efforts to identify ways to leverage operating expenses are ongoing. Several initiatives are underway that are expected to save an additional $1 million to $2 million annually beginning late in the second quarter.”
