Lulus Fashion Lounge Holdings Inc. recently unveiled its third-quarter financial outcomes, leading to a remarkable pre-market stock increase. While the firm recorded a dip in revenue compared to the previous year, it showcased a substantial reduction in its net losses and sustained positive adjusted EBITDA, signaling robust financial health and operational advancements.
Lulus Fashion Lounge Experiences Pre-Market Stock Rally After Announcing Q3 Financials
On Thursday, November 13, 2025, Lulu's Fashion Lounge Holdings Inc. (NASDAQ: LVLU), a prominent player in women's fashion retail, witnessed its shares climb by an impressive 40.90%, reaching $6.89 in pre-market trading. This significant jump followed the disclosure of the company's third-quarter financial results. The previous day, the stock had closed at $4.89, marking a 4.94% increase in the regular session.
The California-based retailer's third-quarter report, ending September 28, revealed a year-over-year decrease in revenue. Specifically, net revenue for Q3 2025 stood at $73.59 million, a 9% decline from $80.51 million in Q3 2024. However, the company successfully minimized its net loss, reporting $2.31 million, a substantial 66.3% improvement from the $6.87 million loss recorded in the same period last year. Furthermore, Lulu's Fashion Lounge's gross margin expanded by 450 basis points, reaching 42.6%.
A notable achievement highlighted by CEO Crystal Landsem was the attainment of positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $0.4 million. This contrasts sharply with the negative $3.6 million reported last year and marks the company's second consecutive quarter of positive adjusted EBITDA. Landsem emphasized that these results underscore the substantial progress made in fortifying and refining core business operations.
Looking ahead, management anticipates a considerable year-over-year enhancement in adjusted EBITDA for the fourth quarter. The company also reaffirmed its capital expenditure projections at $2.5 million. Financially, Lulu's Fashion Lounge secured a new credit agreement and reinforced its balance sheet, reducing net debt from $8.63 million at the close of 2024 to $7.25 million. Despite these positive developments, the stock, with a market capitalization of $13.44 million, has seen a 71.4% decline year-to-date, trading within a 52-week range of $2.98 to $25.50.
This financial report indicates a pivotal moment for Lulu's Fashion Lounge, demonstrating a successful turnaround in profitability amidst a challenging retail landscape. The market's positive reaction reflects investor confidence in the company's strategic adjustments and its trajectory towards sustained financial health. The focus on optimizing core operations and strengthening the balance sheet suggests a resilient approach to navigating market dynamics and fostering long-term growth.