LZB · La-Z-Boy Incorporated

La-Z-Boy's Q4 FY2026 results showed flat consolidated sales of $570.3 million, but significant margin improvement. GAAP operating margin expanded 200 bps to 7.2%, while adjusted operating margin rose 50 bps to 9.9%, driven by strong retail growth and favorable casegoods inventory adjustments ahead of the strategic exit. The Retail segment led with written sales up 11% and delivered sales up 9% to $269.6 million, partly from acquired stores, though same-store written sales declined 2%. Wholesale sales dipped 2% to $393.2 million, yet adjusted operating margin improved to 10.1% from 8.5%. Joybird delivered sales fell 10% to $32 million, and a $20 million goodwill impairment impacted GAAP results. Adjusted diluted EPS of $1.26 beat $0.92 a year ago, including a $0.16 tax benefit. For full fiscal 2026, sales edged up 1% to $2.1 billion, adjusted operating margin was 7.1%, and operating cash flow increased 9% to $204 million. The company ended with $303 million cash and no debt. Management highlighted the exit of wholesale casegoods businesses, U.K. supply chain restructuring, and a new $300 million buyback authorization. Q1 FY2027 guidance calls for sales of $490-510 million (up to 4% organic growth) and adjusted operating margin of 4.0-5.5%, reflecting seasonal lows. The retail expansion and margin execution underpin La-Z-Boy's strategic positioning despite a soft industry backdrop.