• Casper for modular sofas.
• The LEGO of customizable furniture.

• Sactionals: Modular sectional sofas designed for extreme adaptability and reconfigurability.
• Sacs: Oversized, premium foam beanbag chairs offering comfortable and durable seating.
• StealthTech Sound + Charge: An integrated surround sound and wireless charging system specifically designed for Sactionals.
• Footsacs: Ottoman-style footrests that complement their Sactionals and Sacs.
• Pillows & Blankets: A range of accessories including decorative pillows and comfortable blankets.

Lovesac (LOVE) Customer Information

Lovesac (symbol: LOVE) primarily operates on a direct-to-consumer (DTC) model, selling its modular furniture (Sactionals) and "Sacs" directly to individual customers for their homes. Therefore, it does not have major corporate customers in the traditional B2B sense.

Instead, its customer base can be broadly categorized into the following types of individual consumers:

• Families and Homeowners: This category includes individuals and families who are furnishing their primary residences. They often seek durable, versatile, and stylish furniture solutions that can adapt to changing family needs, room layouts, and design preferences over time. The modularity, washable covers, and perceived longevity of Lovesac products appeal to those making a significant investment in their home comfort and aesthetics.

• Young Professionals and Modern Urban Dwellers: This segment comprises younger individuals and couples, often living in apartments, townhouses, or smaller homes, who value modern design, functionality, and sustainability. They appreciate furniture that is adaptable, easy to reconfigure for different occasions or living situations, and designed to last. The brand's focus on innovative design and perceived quality resonates with this demographic.

• Comfort-Seekers and Lifestyle Enthusiasts: This group includes customers specifically drawn to the unique comfort and casual luxury offered by Lovesac's "Sacs" (oversized beanbag chairs) and other accessories. They are looking to create relaxed, inviting spaces in their homes, such as media rooms, lounge areas, or even casual living rooms, prioritizing ultimate comfort and a distinctive aesthetic.

Shawn Nelson, Chief Executive Officer

Shawn Nelson founded Lovesac in 1998 and currently serves as the Chief Executive Officer and a member of the Board of Directors. He is the lead designer of the company's patented products and oversees sourcing, creative, design, public relations, investor relations, and culture. In 2005, Mr. Nelson won Richard Branson's "The Rebel Billionaire" on Fox, leading to a period as acting President of Virgin Worldwide. He holds a Master's Degree in Strategic Design and Management and has served as a graduate-level instructor at Parsons, The New School for Design.

Keith Siegner, Executive Vice President and Chief Financial Officer

Keith Siegner joined The Lovesac Company as Executive Vice President and Chief Financial Officer in June 2023. Previously, he was Chief Financial Officer of Vindex, LLC, a global esports technology and infrastructure company that was sold to Savvy Games Group in February 2023. Before Vindex, Mr. Siegner held the position of Vice President, Investor Relations, Mergers & Acquisitions, and Treasurer at Yum! Brands (NYSE: YUM). He also spent over 15 years as a senior banking executive in equity research at UBS Securities and Credit Suisse, and began his career at Arthur Andersen in the International Tax Consulting Division.

Mary Fox, President and Chief Operating Officer

Mary Fox was appointed President and Chief Operating Officer of The Lovesac Company in November 2021. Prior to Lovesac, she served as General Manager for North America Consumer Products at BIC (OTCMKTS: BICEF) from 2018 to November 2021. Ms. Fox also spent six years at L'Oréal (OTCMKTS: LRLCF) in various roles across Ecommerce, New Business Development, and Business Transformation in the United States. She also held several senior leadership positions at Walmart (NYSE: WMT), including SVP Global Sourcing.

Heidi Cooley, Executive Vice President, Chief Marketing Officer

Heidi Cooley is the Executive Vice President, Chief Brand and Marketing Officer of The Lovesac Company. Before joining Lovesac, she served as the SVP, Chief Marketing Officer at Crocs (Nasdaq: CROX), where she was instrumental in transforming the brand. Prior to Crocs, Ms. Cooley was the Vice President of Marketing at Sports Authority.

Emerging Threat: Furniture as a Service (FaaS) Model

Lovesac's core business model revolves around selling highly modular, durable, and customizable furniture ("Sactionals" and "Sacs") with a "Designed for Life" philosophy, encouraging long-term ownership and investment. A clear emerging threat comes from the Furniture as a Service (FaaS) model, where consumers rent or subscribe to furniture rather than buying it outright.

Companies like Feather and Fernish offer flexible furniture subscriptions, allowing customers to easily swap pieces, upgrade, or return them as their needs or tastes change. This model directly challenges Lovesac's emphasis on permanent ownership and high upfront cost by appealing to consumers who prioritize flexibility, lower commitment, and the ability to frequently refresh their living spaces without the burden of depreciation or disposal.

Similar to how Netflix offered a subscription model for entertainment access that threatened Blockbuster's physical ownership/rental model, FaaS presents an alternative consumption paradigm for home furnishings. As urban populations grow, living spaces become more temporary, and younger generations increasingly value experiences over possessions, the FaaS model could significantly erode the long-term ownership market that Lovesac targets, especially for those seeking modularity and adaptability without the permanent financial commitment.

Lovesac's primary addressable markets in the U.S. are as follows:

• The couch, seating, and chair addressable market is valued at approximately $41.7 billion.
• The home audio market, relevant to their StealthTech Sactionals, is approximately $46.2 billion.
• The living room furniture market in the U.S. is approximately $68 billion and is projected to grow to about $82 billion by 2028.

The recent launch of Lovesac's EverCouch platform, which expands their offerings into armchairs, loveseats, and sofas, is expected to effectively double their total addressable market.

Here are 3-5 expected drivers of future revenue growth for Lovesac (LOVE) over the next 2-3 years:

1. Omnichannel Expansion: Lovesac continues to drive revenue growth through the expansion of its physical showroom footprint and by strengthening its e-commerce delivery model. The company's direct-to-consumer approach, supported by over 270 retail showrooms, contributes to increased net sales, with showroom sales experiencing an 18.9% increase in Q3 2024 due to comparable sales growth and the addition of 41 new showrooms. Ongoing investments in physical expansion are expected to bolster future sales.
2. Product Innovation and New Launches: Lovesac is focused on introducing new products and platforms to expand its market reach. The recent introduction of EverCouch, a new seating platform, is a significant driver, as it broadens the range of available seating options and effectively doubles the company's total addressable market. Additionally, the launch of the Reclining Seat product line and the national rollout of "Snugg" are expected to contribute to future sales growth and market penetration.
3. Growth in Customer Base and Repeat Purchases: A key driver is the continued acquisition of new customers and the strong loyalty of existing ones. Lovesac acquired 155,000 new customers in fiscal year 2024, building on previous growth. Repeat customers are a significant factor, accounting for 43% of the company's transactions in the recent fiscal year, indicating a strong propensity for recurring revenue from its existing customer base.
4. Market Share Gains in a Challenging Industry: Despite a declining trend in the broader furniture industry, Lovesac has demonstrated the ability to outperform the market and gain share. The company reported a 7.5% increase in revenue in fiscal year 2024, reaching $700 million, even as overall furniture retail revenues declined. This continued outperformance positions Lovesac for further growth as it captures a larger portion of the market.
5. Strategic Marketing Initiatives and Brand Refresh: Lovesac is investing in its brand and marketing efforts to drive profitable sales. The appointment of a new Chief Marketing Officer and a refreshed brand strategy aim to enhance brand awareness and support the company's ambition to become a leading home brand. These initiatives are designed to foster increased interest and passion for the Lovesac brand among both new and existing customers.

Share Repurchases

• On July 31, 2024, Lovesac's Board of Directors authorized a share repurchase program of up to $40 million of the company's outstanding common stock.
• This program is expected to be funded through existing cash and future free cash flow, allowing for various repurchase methods.
• As of November 3, 2024, Lovesac repurchased 131,424 shares for $3.4 million, with $36.6 million remaining available under the program.

Share Issuance

• In fiscal 2025, the 2017 Equity Plan was amended to increase the shares of common stock authorized and reserved for issuance by 1,100,000 shares, bringing the total reserved to 3,979,889 shares.
• The number of outstanding shares saw a decrease from 14,786,934 as of February 2, 2025, to 14,549,250 as of May 4, 2025.
• As of November 2025, the number of outstanding shares was 14,623,823.

Capital Expenditures

• Net cash used in investing activities, primarily capital expenditures, was $21.5 million in fiscal 2025, a decrease from $29.2 million in fiscal 2024.
• Capital expenditures are primarily focused on investments related to new showroom openings, including leasehold improvements, fixtures, equipment, and the acquisition of intangible assets.
• Cash paid for capital expenditures amounted to $13.2 million in the twenty-six weeks ended August 3, 2025, with expectations to continue supporting showroom growth for fiscal year 2026.