HOOKER FURNISHINGS Corp
For the period ended Aug 2, 2026. Filed Sep 11, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Aug 2, 2026 · Filed Sep 11, 2026
HOFT$14.53-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-05-03; filed 2026-06-12.
0001185185-26-002495
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-08-02; filed 2026-09-11.
0001185185-26-003941
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 98 previous paragraphs and 100 current paragraphs.
69 unchanged; 13 reworded; 18 added; 16 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 32 previous and 36 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Tariff-related matters:
Current report
Prior to the U.S. Supreme Court’s February 2026 decision invalidating the IEEPA tariffs, the Company incurred an estimated $10.3 million of cumulative pre-tax costs related to tariffs in fiscal year 2026, which had a significant adverse impact on the fiscal 2026 results, and significantly exceeded the tariff recoveries the Company received. Following the imposition of IEEPA tariffs beginning in April 2025, the Company elected to honor pricing on its existing customer backlog and, for competitive and administrative reasons, did not immediately adjust pricing on certain other products. The Company's pricing reflects its total cost structure and the competitive and macro-economic environment in which it operates, with tariffs being only one of many factors considered.
Current report
During the second quarter of fiscal 2027, the Company received $7.9 million in recoveries related to tariffs imposed under the IEEPA on imported products from the implementation of the tariffs through the U.S. Supreme Court’s decision in early February 2026. Most of the products associated with these recoveries had been sold during fiscal 2026. In continuing operations, the Company recorded $4.3 million as a reduction of cost of sales and $201,000 as interest income in the second quarter of fiscal 2027, partially offset by a $522,000 reduction of revenue. In discontinued operations, the Company recorded $1.6 million as a reduction of cost of sales and $54,000 interest income, partially offset by a $612,000 reduction of revenue. Additionally, approximately $1.8 million of the tariff recoveries had not yet impacted costs of sales and was recorded as a reduction of the carrying value of inventories at quarter end. The Company does not expect to receive material additional tariff recoveries.
Current report
Results of Operations and Financial Position
Current report
During the second quarter of fiscal 2027, consolidated net sales decreased by $6.0 million, or 8.7%, versus the prior year three-month period, reflecting declines in our two reportable segments and All Other. Hooker Branded was affected by lower unit volume and higher promotional discounts, while Domestic Upholstery declines in upscale leather and custom fabric were partially offset by growth in private-label and outdoor furnishings. All Other decreased primarily due to hospitality project timing. Despite lower net sales, consolidated gross profit increased by $2.9 million, and gross margin increased by 690 basis points, primarily due to tariff recoveries and higher average selling prices at Hooker Branded. The Company reported an operating income of $1.3 million, compared to a $0.5 million loss in the prior-year second quarter. Consolidated net income from continuing operations was $1.2 million, or $0.11 per diluted share.
Current report
During the first six months of fiscal 2027, consolidated net sales decreased by $7.7 million, or 5.5%, versus the prior year six-month period. The decrease reflected lower Hooker Branded unit volume, higher promotional discounts, and first-quarter inventory constraints in imported upholstery, as well as continued weakness in Domestic Upholstery’s upscale leather and custom fabric businesses. All Other was affected by hospitality project timing, with approximately 80% of first-half shipments occurring during the first quarter. Consolidated gross profit increased by $5.5 million, and gross margin increased by 560 basis points, driven primarily by tariff recoveries, as well as improvements in Hooker Branded and Domestic Upholstery. The Company reported an operating income of $2.9 million, compared to a $1.0 million loss in the prior-year first half, representing $3.9 million improvement. Consolidated net income from continuing operations was $2.3 million, or $0.21 per diluted share.
Current report
Consolidated net sales decreased by $6.0 million or 8.7%, and $7.7 million, or 5.5%, during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. The decreases were attributable to lower net sales in our two reportable segments and All Other.
Current report
Consolidated gross profit increased by $2.9 million and $5.5 million during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. Gross margin increased by 690 and 560 basis points during the respective periods. These improvements were primarily driven by Hooker Branded and, to a lesser extent, Domestic Upholstery, partially offset by lower gross profit in All Other, primarily due to lower net sales.
Current report
The Company reported operating income of $1.3 million and $2.9 million during the second quarter and first six months of fiscal 2027, respectively, compared with operating losses of $0.5 million and $1.0 million in the corresponding prior-year periods. Both reportable segments generated operating income during both periods. All Other reported a second-quarter operating loss due to lower hospitality sales but remained profitable for the six-month period due to higher first-quarter shipments.
Current report
For the second quarters of fiscal 2027 and fiscal 2026, we recorded income tax expense of $338,000 and income tax benefit of $114,000 under continuing operations. The effective tax rate for continuing operations was 21.3% for the second quarter of fiscal 2027 compared to 17.3% for the second quarter of fiscal 2026.
Current report
For the first half of fiscal 2027 and fiscal 2026, we recorded income tax expense of $664,000 and income tax benefit of $278,000 under continuing operations. The effective tax rate for continuing operations was 22.3% for the first six months of fiscal 2027 compared to 19.3% for the first six months of fiscal 2026.
Current report
The increase in both periods was primarily due to a prior-year state net operating loss valuation allowance adjustment, along with the shifting tax impact of company-owned life insurance gains and restricted stock compensation relative to prior-year operating losses versus current-year operating income.
Current report
Although the divestiture was completed in the prior fiscal year, current-period activities in discontinued operations primarily reflected tariff recoveries received by the Company. The $612,000 of the recoveries to be credited to customers were recorded as a reduction of revenue to reflect the corresponding customer reimbursement. The $1.6 million refunds of tariff costs previously recognized in cost of sales were recorded as a reduction of cost of sales. Current-period activity also included approximately $0.5 million of additional charges arising from the net settlement of various divestiture-related balances with the buyer. See Note 3 to our condensed consolidated financial statements for additional information.
Current report
Market conditions remain challenging as consumers continue to be selective and housing turnover and demand for big-ticket discretionary products remain weak. In July, retail sales at furniture and home furnishings stores were essentially flat sequentially but decreased 1.2% year over year, while existing-home sales declined 1.7% month over month to a seasonally adjusted annual rate of 4.1 million, remaining at historically low levels. Consumer sentiment decreased 6.3% in August, and July headline inflation remained elevated at 3.4%, although core inflation eased to 2.5%. These factors, together with elevated financing costs, continue to pressure discretionary purchasing power. The Company also continues to monitor tariff developments.
Current report
Given these conditions, the Company does not expect meaningful near-term improvement in market demand. However, changes to the Company’s cost structure and portfolio are delivering tangible benefits and are expected to support improved results compared with the prior-year period, even if current conditions persist.
Current report
With the principal cost-reduction initiatives completed, the Company is focused on disciplined execution across its core businesses and converting improved order momentum into sales. Actions taken during the past 18 to 24 months have created a leaner and more disciplined operating model designed to generate stronger and more consistent earnings over time.
Current report
Retailer response to Margaritaville remains encouraging, with commitments to approximately 100 in-store galleries and 10 free-standing retail stores, roughly double the levels reported in December. Shipments began during the second quarter and are expected to build through the second half of fiscal 2027 and into fiscal 2028. Together with Hooker Branded order momentum, the Margaritaville rollout positions the Company to capitalize on opportunities as demand recovers.
Current report
Cash and cash equivalents increased by $17.5 million during the first six months of fiscal 2027 to $18.7 million, compared with a $5.5 million decrease in the prior-year period. The increase primarily reflected $24.0 million provided by operating activities from continuing operations and $1.7 million provided by discontinued operations, partially offset by $7.3 million used in financing activities and $873,000 used in investing activities. Current-period cash flows included $7.9 million of tariff recoveries, of which $1.7 million related to discontinued operations.
Removed paragraphs (16)
Previous report
Despite continued weakness in the housing market, soft furniture and home furnishings retail sales, and persistent macroeconomic challenges, the Company generated operating income of $1.6 million in the first quarter of fiscal 2027, compared to an operating loss of $498,000 in the prior-year period. This $2.1 million improvement was achieved despite a 2.4% decrease in consolidated net sales and reflects the impact of improved gross margin and cost-reduction initiatives implemented in prior periods, and the Company’s progress toward becoming a leaner, higher-margin business with a lower break-even point.
Previous report
Consolidated net sales decreased $1.7 million, or 2.4%, in the first quarter of fiscal 2027 due to lower sales in Hooker Branded and Domestic Upholstery, partially offset by higher shipments in the All Other hospitality business. Despite a decrease in net sales, consolidated gross profit increased $2.7 million and gross margin improved 440 basis points, primarily driven by improved profitability in Hooker Branded. The Company generated operating income of $1.6 million for the quarter, driven by operating income in Hooker Branded and All Other, partially offset by an operating loss in Domestic Upholstery. Consolidated net income from continuing operations was $1.1 million, or $0.10 per diluted share.
Previous report
Tariff Update
Previous report
During the fiscal 2027 first quarter, the Company submitted refund claims totaling approximately $8 million. Due to uncertainty regarding the ultimate recoverability, timing and amount of any refunds, the Company did not recognize a receivable or any reduction of cost of sales or inventory related to these claims in its unaudited condensed consolidated financial statements for the first quarter of fiscal 2027. Under U.S. GAAP, the Company is applying a gain contingency model to evaluate potential tariff refunds, recognizing such amounts only when recovery is realized or realizable. The Company continues to monitor the recoverability of potential tariff refunds and the potential impact of any new or additional tariffs imposed under other legal authorities.
Previous report
Consolidated net sales decreased $1.7 million, or 2.4%, in the first quarter of fiscal 2027, driven primarily by lower net sales at Hooker Branded and, to a lesser extent, Domestic Upholstery. These decreases were partially offset by increased net sales in All Other, primarily due to significantly higher shipments during the quarter.
Previous report
Consolidated gross profit exceeded prior-year period by $2.7 million or 440 basis points, driven by a significant increase at Hooker Branded.
Previous report
In the first quarter of fiscal 2027, the Company recorded operating income of $1.6 million, which included operating income of $1.2 million in the Hooker Branded segment, driven by improved gross profit, and $1.1 million in All Other, driven by higher shipments in the hospitality business. These results were partially offset by an operating loss of $689,000 in the Domestic Upholstery segment, driven by its indoor residential furnishings businesses.
Previous report
We recorded income tax expense of $326,000 and tax benefit of $164,000 for the fiscal 2027 and 2026 first quarters from continuing operations. The effective tax rates for the fiscal 2027 and 2026 first quarters were 23.5% and 21.1%, respectively. The increase in the effective tax rate for the current fiscal quarter was primarily due to the relative impact of restricted stock compensation when compared to operating profits in the current year period and operating losses in the prior year period, as well as a change in valuation allowance recorded in the prior year period for a state loss carryforward.
Previous report
Consolidated incoming orders increased 8% in May compared to the prior-year period, while backlog was up 14% year-over-year. The improvement was primarily driven by Margaritaville orders, which had its initial shipment in May.
Previous report
However, housing activity remains pressured, and recent consumer confidence readings continue to reflect a very cautious consumer environment. The Department of Commerce’s April advance monthly estimates showed retail sales for furniture and home furnishings stores declined 2.0% from March and 3.6% from the prior year. Additionally, we continue to monitor tariff developments. Based on currently available information, we expect certain tariffs to be levied on our imported goods later this fiscal year, which will replace, at least in part, the tariffs overturned by the U.S. Supreme Court earlier this year.
Previous report
Our outlook for the fiscal 2027 second quarter is cautious, given the current macro-economic pressures. While we do not expect meaningful near-term improvement in market conditions, our more efficient cost structure and streamlined portfolio should help us to deliver improved results versus the prior-year period, even if current conditions persist.
Previous report
Our advantage is a sharper focus on our core businesses, a more disciplined operating model, and an organization aligned around profitable growth. While macroeconomic conditions remain challenging and tariff uncertainty persists, we believe the actions taken over the past year have positioned the Company to generate improved and more consistent earnings as market conditions improve.
Previous report
Retailer commitments to Margaritaville products, galleries, and free-standing stores continue to exceed our expectations, with commitments to 100 in-store galleries and 10 free-standing retail stores to-date, as compared with about half those numbers when we reported in December. Meaningful shipments are expected to begin in the second half of fiscal 2027 and expected to build through the end of the current fiscal year and beyond. Combined with continued momentum in incoming orders across our core businesses, we believe we are well positioned to capitalize on opportunities as demand recovers.
Previous report
During fiscal 2027 first quarter, cash increased by $9.5 million, from $1.1 million at the beginning of the period to $10.6 million at period-end. The increase in cash was primarily driven by strong cash provided by operating activities, partially offset by cash used in financing activities.
Previous report
Cash provided by investing activities totaled $21,000 for the current quarter, compared to cash used in investing activities of $0.8 million in the prior-year period. The change was primarily due to $0.5 million of proceeds received on life insurance policies in the current-year period and lower purchases of property and equipment.
Previous report
Cash used in financing activities was $4.9 million compared to $2.0 million for the prior-year period. Financing cash flows included proceeds from the revolving credit facility of $3.2 million, which were more than offset by repayments of $6.7 million. The Company also paid cash dividends of $1.3 million, compared to $2.5 million in the prior-year period, and used $96,000 for the purchase and retirement of common stock.
Reworded paragraphs (13)
Previous wording
All references to the “Company,” “we,” “us” and “our” in this document refer to Hooker Furnishings Corporation and its consolidated subsidiaries, unless specifically referring to segment information. The Hooker Branded segment includes Hooker Casegoods and Hooker Upholstery. The Domestic Upholstery segment includes Bradington-Young, HF Custom (formerly Sam Moore), Shenandoah Furniture and Sunset West. “All Other” includes Samuel Lawrence Hospitality product line, intercompany eliminations and operating segments that are not individually reportable.
Current wording
All references to the “Company,” “we,” “us” and “our” in this document refer to Hooker Furnishings Corporation and its consolidated subsidiaries, unless specifically referring to segment information. The Hooker Branded segment includes Hooker Casegoods and Hooker Upholstery. The Domestic Upholstery segment includes Bradington-Young, HF Custom (formerly Sam Moore), Shenandoah Furniture and Sunset West. “All Other” includes Samuel Lawrence Hospitality, intercompany eliminations and operating segments that are not individually reportable.
Previous wording
This quarterly report on Form 10-Q includes our unaudited condensed consolidated financial statements for the 2027 fiscal year thirteen-week period (also referred to as “three months,” “three-month period,” “quarter,” “first quarter” or “quarterly period”) that began February 2, 2026 and ended May 3, 2026. This report discusses our results of operations for this period compared to the 2026 fiscal year thirteen-week period that began February 3, 2025 and ended May 4, 2025; and our financial condition as of May 3, 2026 compared to February 1, 2026.
Current wording
This quarterly report on Form 10-Q includes our unaudited condensed consolidated financial statements for the 2027 fiscal year thirteen-week period (also referred to as “three months,” “three-month period,” “quarter,” “second quarter” or “quarterly period”) that began May 4, 2026 and the twenty-six-week period (also referred to as “six months”, “six-month period”, or “first half”) that began February 2, 2026, which both ended August 2, 2026. This report discusses our results of operations for these periods compared to the 2026 fiscal year thirteen-week period that began May 5, 2025, and the twenty-six-week period that began February 3, 2025, which both ended August 3, 2025; and our financial condition as of August 2, 2026 compared to February 1, 2026.
Previous wording
Consolidated backlog at the end of the first quarter of fiscal 2027 increased 4.5% compared to the prior-year first quarter. The increase was primarily driven by higher backlog in Hooker Branded. Domestic Upholstery backlog increased modestly compared to both the prior-year first quarter and fiscal 2026 year-end, driven by higher private label orders. All Other backlog decreased significantly compared to both periods, primarily due to large hospitality shipments during the current quarter and the project-based nature of the hospitality business.
Current wording
Consolidated backlog at the end of the second quarter of fiscal 2027 increased 6.2% compared with the end of the prior-year second quarter and 8.4% from the end of the first quarter of fiscal 2027. The increases were primarily driven by higher Hooker Branded backlog. Domestic Upholstery backlog also increased, primarily due to higher private-label orders. All Other backlog decreased significantly during the six-month period, primarily due to large hospitality shipments during the first quarter and the project-based nature of the hospitality business.
Previous wording
In February 2026, the U.S. Supreme Court ruled that certain tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) were not authorized by statute. In March 2026, the U.S. Court of International Trade directed U.S. Customs and Border Protection to implement a process for refunding previously collected duties.
Current wording
In February 2026, the U.S. Supreme Court ruled that certain tariffs imposed pursuant to the International Emergency Economic Powers Act (“IEEPA”) exceeded the authority granted under the statute. In March 2026, the U.S. Court of International Trade directed U.S. Customs and Border Protection to establish a process for refunding tariffs previously collected under IEEPA.
Previous wording
In addition to improved profitability, the Company significantly improved its liquidity and financial flexibility during the quarter. Cash and cash equivalents increased to $10.6 million at quarter-end, with no outstanding term loan balance, compared to $1.1 million of cash and $3.6 million outstanding under the term loan at prior fiscal year-end. In April 2026, the Company began repurchasing shares under its previously authorized $5 million share repurchase program.
Current wording
In addition to improved profitability, the Company significantly improved its liquidity and financial flexibility during the quarter. Cash and cash equivalent increased to $18.7 million at the end of second quarter, with no outstanding term loan balance, compared to $1.1 million cash on hand and $3.6 million term loan balance at fiscal 2026 year-end, primarily reflecting tariff refund proceeds and accounts receivable collections. For the six-month period, $24.0 million in cash generated from operating activities funded the repayment of $3.6 million of principal amount of outstanding loans, $2.5 million in cash dividends, $1.3 million for share repurchases under the previously authorized $5 million share repurchase program, and $1.1 million capital expenditures.
Previous wording
Our fiscal 2027 first quarter performance is discussed in greater detail below under “Results of Operations – Continuing Operations” and “Results of Operations – Discontinued Operations”.
Current wording
Our fiscal 2027 second quarter and first-half performance is discussed in greater detail below under “Results of Operations – Continuing Operations” and “Results of Operations – Discontinued Operations”.
Previous wording
Fiscal 2027 First Quarter Compared to Fiscal 2026 First Quarter
Current wording
Fiscal 2027 Second Quarter and First Half Compared to Fiscal 2026 Second Quarter and First Half
Previous wording
Consolidated selling and administrative (“S&A”) expenses increased in absolute terms and as a percentage of net sales, driven by higher expenses in Hooker Branded and partially offset by decreases in Domestic Upholstery and All Other.
Current wording
Consolidated selling and administrative (“S&A”) expenses increased in absolute terms and as a percentage of net sales during the second quarter and first six months of fiscal 2027, driven by higher expenses in Hooker Branded and partially offset by decreases in Domestic Upholstery and All Other.
Previous wording
Intangible asset amortization decreased compared to the prior-year first quarter, primarily due to the absence of amortization related to the Home Meridian trade name allocated to the hospitality business, which was reclassified to All Other, and the Sam Moore trade name amortization. See Note 9 to our condensed consolidated financial statements for additional information.
Current wording
Intangible asset amortization decreased compared to the prior-year second quarter, due to the absence of amortization related to the Home Meridian trade name allocated to the hospitality business, which was reclassified to All Other. The decrease during the six-month period also reflected the absence of amortization expenses related to the Sam Moore trade name. See Note 9 to our condensed consolidated financial statements for additional information.
Previous wording
We incurred $598,000 in previous fiscal years in debt issuance costs in connection with our term loans. As of May 3, 2026, unamortized loan costs of $444,000 were recorded in other assets on our condensed consolidated balance sheets.
Current wording
We incurred $598,000 in previous fiscal years in debt issuance costs in connection with our term loans. As of August 2, 2026, unamortized loan costs of $415,000 were recorded in other assets on our condensed consolidated balance sheets.
Previous wording
As of May 3, 2026, there were no outstanding loans, other than $3.2 million face amount of letters of credit. We had $54.2 million of Availability based on the current Borrowing Base. There were no additional borrowings outstanding under the Amended and Restated Loan Agreement as of May 3, 2026.
Current wording
As of August 2, 2026, there were no outstanding loans, other than $3.2 million face amount of letters of credit. We had $51.8 million of Availability based on the current Borrowing Base. There were no additional borrowings outstanding under the Amended and Restated Loan Agreement as of August 2, 2026.
Previous wording
During fiscal 2027 first quarter, we used approximately $96,000 of the authorization to purchase 7,615 of our common shares (at an average price of $12.53 per share), with approximately $4.9 million remaining available for future purchases under the authorization.
Current wording
During fiscal 2027 first half, we used approximately $1.3 million of the authorization to purchase 92,357 of our common shares (at an average price of $13.68 per share), with approximately $3.7 million remaining available for future purchases under the authorization.
Previous wording
We expect to spend approximately $2.5 million in capital expenditures in the remainder of fiscal 2027 to maintain and enhance our operating systems and facilities.
Current wording
We expect to spend approximately $2.0 million in capital expenditures in the remainder of fiscal 2027 to maintain and enhance our operating systems and facilities.