by Can Aldo Uva navigate Natuzzi back to the promised land?
DANBURY, Conn. Last week should have been a big one for Ethan Allen and Natuzzi. Activist investor Doug Bergeron did his part, announcing a national search for the next CEO of Ethan Allen, a search notable for many reasons, including the fact that the position isn’t open. Sitting in that chair now, as he has for nearly 40 years, is Farooq Kathwari.
Natuzzi, which, like Ethan Allen has seen its market share dwindle, was expected to announce on Friday its next CEO, a position that has been open since July, when Antonio Achille stepped down. After radio silence from Santeramo over the weekend, yesterday the company identified Aldo Uva as he who will be charged with the turnaround. Uva should be a familiar name; he was CEO at Natuzzi before, in 2008-9.
Surprisingly, the two brands and companies have quite a bit in common. Each is captained by a legendary figure in his 80s. Each is vertically integrated, giving both tremendous advantages when demand is strong and massive anchors that drag on earnings when the seas are rough. Each has been restructuring to better position in an industry wracked by tariffs, supply chain unpredictability, fickle demand, and, as RH’s Gary Friedman chants with Gregorian regularity, “the worst housing market in four decades.” And with the rewards of these restructurings not yet fully realized, each is under pressure to show greater, quicker progress.
The future is now
The urgency couldn’t be greater. Ethan Allen is barreling toward its annual shareholder meeting in November and a climactic battle and vote over just who is going to lead going forward and just where this leader is going to try to go. At Natuzzi, alarm bells rang on Aug. 26 when the New York Stock Exchange notified the company that the exchange had suspended trading in Natuzzi’s American Depositary Shares and has begun proceedings to delist the company. Natuzzi has been unable to maintain an average global market capitalization over a consecutive 30 trading-day period of at least $15 million for its ADS.
Natuzzi requested a review of the NYSE decision on Wednesday. On Thursday, the controlling shareholder agreed to reclassify €5 million in loans granted to the company as payment toward a future capital increase. The controlling shareholder is the Natuzzi family’s holding vehicle, so the Natuzzis seems to be saying that they believe in the company enough to convert debt into a permanent stake that equates to taking on more downside risk themselves. While this move doesn’t directly address the market cap problem, it does provide for a healthier balance sheet while Natuzzi fends off the delisting decision.
Whether Ethan Allen’s shareholders yield to activist demands for digital evolution and changes in leadership, among other moves, or Natuzzi succeeds in stabilizing its operational footprint under Uva, both of these brands are pivotal for the industry writ large. When considered in juxtaposition, the challenges these legacy brands face show that controlling the factory and the showroom are no longer enough. Also required is mastering the consumer journey that begins and often ends in digital spaces and maintaining an agile operational structure.
Both brands have been taking on water.
Ethan Allen reported a 5.7% year-over-year decline in net sales for the fiscal year ended June 30, and the company’s shares have fallen 26% in value over the past year. Meanwhile over at Natuzzi, navigating the structural changes has proved to be a bit like trying to get through the Strait of Hormuz.
Management called the recently concluded first quarter “disappointing,” which is putting it mildly. Natuzzi has logged operating losses of €18.8 million in 2025, €6.3 million in 2024, and €9.5 million in 2023. For the first quarter of 2026, revenue fell 24% year over year to €59.5 million, with a widening net loss. This most recent result put the company’s NYSE-listed ADS market cap at just $14.6 million, or under the requisite $15 million threshold.
Just as Ethan Allen has been shrinking its design galleries over the past five or so years, Natuzzi is shrinking its manufacturing footprint to better match its sales volume. Reducing its factories in Italy from five to two and moving U.S.-bound Natuzzi Editions production to Romania, Natuzzi is in the middle of a substantial restructuring. And at retail, with foot traffic falling in the double digits, Natuzzi is shifting from walk-ins to a “Natuzzi Studio” format that targets architects and designers. Ethan Allen has made a similar change in retail strategy.
But, a trailing loss per share of $3.17 and return on equity at negative 78% mean the clock is ticking for the Italian company.
Plenty of differences
The two companies got to these inflection points in different ways. For Ethan Allen, Bergeron argues that substantial digital market share is being left on the table for competitors like Wayfair or RH while Kathwari’s focus has remained steadfastly on high-touch, in-person interior design services. Bergeron’s model would have Ethan Allen prioritizing itself as a digital-facing platform rather than treating e-commerce primarily as a lead-generation tool for design centers.
Ethan Allen “has only paid lip service to shareholder demands for investment in innovation, modernization and the digital capabilities needed to compete in today’s growing luxury furniture market,” Bergeron states in his letter to fellow Ethan Allen shareholders. “The result is a business whose revenue has declined for two decades, shrinking while competitors have taken market share and grown into multibillion-dollar platforms.”
For Natuzzi, the loss of market share stems more from its geographic footprint. Operating high-cost Italian factories to produce mid-tier furniture has ill-positioned the company to compete on price against Asian producers, but neither has it been able to pivot as quickly to high-margin direct-to-consumer models.
Balance sheet resilience is another key difference. For Ethan Allen, the balance sheet shows basically zero long-term debt, consistent cash generation and a pristine financial cushion. This vessel is seaworthy and armored. Not the case at Natuzzi. Highly leveraged with tight liquidity, Natuzzi also has to fund a relatively high operational cost structure. Its ship is taking on a lot of water, making it fragile and vulnerable.
Thus, at Ethan Allen the activist battle is a debate about where to take the ship. Bergeron wants a restoration of growth, a clearer and better strategy, and digital fluency. Natuzzi needs a CEO fast who can steer it to calmer waters, including financial survival and operational solvency, all the while dealing with compliance warnings from the NYSE and managing operations for a global company open for business somewhere 24 hours a day, seven days per week. Uva could be the right choice, because as CEO at Incredo, he “led a comprehensive strategic transformation aimed at redefining the company’s business model, validating a new growth platform and establishing a scalable long-term strategy,” according to Natuzzi’s press release. That’s quite a feat for someone in the job less than 11 months.
The industry needs these treasured legacy brands to thrive. I write this sitting in a Natuzzi recliner in bright yellow that I have cherished for decades, and my respect and admiration for both Kathwari and Pasquale Natuzzi run deep.
Rinse and repeat?
We also know that this isn’t the first time Ethan Allen has weathered this kind of storm. In an account of another activist fight in 2015, leadership noted that hedge fund activists win about 90% of the proxy campaigns they initiate, especially when they are supported by Institutional Shareholder Services. And yet Ethan Allen prevailed against Sandell Asset Management by directly engaging shareholders rather than following conventional advisor-driven playbook. Whether that history repeats in 2026 is one of the big questions going into Ethan Allen’s annual meeting.
(As a footnote, Sandell had a 5.5% stake in the company; Bergeron has a 5.2% stake.)
I attribute the many references to seafaring in this column to a recent viewing of The Odyssey, which we quite enjoyed. Of course, it doesn’t hurt that Natuzzi once exhibited in a giant showroom building that looks like it is sluicing through downtown High Point, or that Pasquale Natuzzi is a yachtsman. As for Kathwari, he said in an interview while swatting away Bergeron’s critique of his age that he remains very active.
“I’m a mountain climber. I’m a sports person. I have a boat,” he said.
Maybe both captains could benefit from Homer’s words in The Odyssey: “Take courage, my heart: you have been through worse than this. Be strong, saith my heart; I am a soldier; I have seen worse sights than this.”
