Full Transcript: Lulus Fashion Lounge Q1 2026 Earnings Call

Lulus Fashion Lounge (NASDAQ: LVLU ) released first-quarter financial results and hosted an earnings call on Wednesday.

Read the complete transcript below.

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View the webcast at Summary Net revenue for Lulu's Fashion Lounge Holdings Inc decreased by 10% year over year to $57.5 million, impacted by a 15% decrease in total orders and higher return rates, but offset by increased average order value and wholesale revenue.

Gross margins expanded by 480 basis points to 45.1%, driven by a shift to higher margin categories and improved shipping costs.

Adjusted EBITDA showed significant year-over-year improvement, reducing losses from $4.7 million in Q1 2025 to $1.5 million in Q1 2026.

The company emphasized progress in strategic areas: enhanced order economics, expanding wholesale channels, and leveraging technology for efficiency.

Lulu's reset casual apparel and footwear categories, leading to improved inventory productivity and a cleaner inventory position exiting the quarter.

Wholesale revenue increased by 112% year over year, with expansion into Nordstrom and Dillard's stores.

Operational cost reductions were achieved, including a 13% decline in operating expenses due to efficiency gains.

Future guidance indicates expectations for positive adjusted EBITDA in Q2 2026 and continued focus on improving profitability and financial positioning for the full year.

Management highlighted strong engagement through marketing strategies, including influencer partnerships and a new brand campaign to enhance brand visibility.

Full Transcript OPERATOR Good afternoon and welcome to Lulu's Fashion Lounge first quarter 2026 earnings call.

Today's call is being recorded.

At this time, I'd like to turn the conference over to Lulu's General Counsel and Corporate Secretary, Naomi Beckman Strauss.

Thank you.

You may begin.

Naomi Beckman Strauss, General Counsel and Corporate Secretary Good afternoon everyone and thank you for joining us to discuss Lulu's first quarter fiscal 2026 results.

Before we begin, we would like to remind you that this conference call will include forward-looking statements within the meaning of the Litigation Reform Act of 1995.

All statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements, including but not limited to statements regarding management's expectations, plans, strategies, goals, and objectives and their implementations.

These forward-looking statements are subject to various risks, uncertainties, assumptions, and other important factors which could cause our actual results, performance, or achievements to differ materially from results, performance, or achievements expressed or implied by these forward-looking statements.

These risks, uncertainties, and assumptions are detailed in this afternoon's press release as well as our filings with the SEC, including our annual report on Form 10-K for the fiscal year ended December 28, 2025, which can be found on our website at investors.lulu.com.

During our call today, certain non-GAAP financial information including adjusted EBITDA, adjusted EBITDA margin, net debt, and free cash flow will be discussed.

Our non-GAAP measures may be different from non-GAAP measures used by other companies.

Reconciliation of GAAP to non-GAAP measures as well as the description, limitations, and rationale for using each measure can be found in this afternoon's press release and in our SEC filing.

We also use certain key operating metrics including gross margin, average order value, and active customers.

The description of these metrics can also be found in this afternoon's press release and in our SEC filing.

Joining me on the call today are our CEO Crystal Landsem, our CFO Heidi Crane, and our President and CIO Mark Vos.

Following our prepared remarks, we'll open the call for your questions.

With that, I'll turn the call over to Crystal.

Crystal Landsem, Chief Executive Officer Thank you, Naomi, and good afternoon everyone.

We appreciate you joining us today.

In the first quarter, we continued to make meaningful progress across the business as we executed against the operational and merchandising initiatives supporting our reset.

We exited 2025 in the first quarter of 2026 having completed much of the foundational reset work and are now positioning the business for recovery and re-acceleration in the second half of the year.

We believe the continued strength of our higher margin event-driven categories combined with our assortment optimization efforts have improved order economics, deepened customer engagement, and further reinforced our position as a special occasion brand.