What changed in this filing

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Item 1. Business

2026-04-02 compared with 2025-04-10 · 47 added, 43 removed, 189 unchanged (32% of the section changed)

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We are a technology driven company that designs, manufactures and sells unique, high quality furniture derived through our proprietary Designed for Life® approach which results in products that are built to last a lifetime and designed to evolve as our customers’ lives do.

Our current product offering is comprised of modular couches called Sactionals, premium foam beanbag chairs called Sacs, the immersive surround sound home theater system called StealthTech, and the most recently launched PillowSac TM Accent Chair and Sactionals Reclining Seat.

Innovation is at the center of our design philosophy with all of our core products protected by a robust portfolio of utility patents.

We market and sell our products through an omni-channel platform that includes direct-to-consumer touch points in the form of our own showrooms, which include our mobile concierge and kiosks, and online directly at www.lovesac.com.

Our current product offering is comprised of modular couches called Sactionals®, premium foam beanbag chairs called Sacs®, the immersive surround sound home theater system called StealthTech®, the PillowSac® Chair, the Sactionals Reclining Seat, a recently launched platform of premium seating called Snugg TM , and various accessories.

Innovation is at the center of our design philosophy with all of our core products protected by a robust portfolio of utility and design patents.

We market and sell our products through an omni-channel platform that includes direct-to-consumer touch points in the form of our own showrooms and online directly at www.lovesac.com.

We believe that our ecommerce centric approach, coupled with our ability to deliver our large upholstered products through express couriers, is unique to the furniture industry.

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Utilizing primarily two, standardized pieces, “seats” and “sides,” and approximately 200 high quality, tight-fitting cover options that are removable, washable, and changeable, customers can create numerous permutations of a sectional couch with minimal effort.

Cu stomization is further enhanced with our specialty-shaped modular offerings, such as our wedge seat, roll arm and angled sides.

In September 2024, we launched the AnyTable TM , a versatile table that seamlessly enhances any Sactionals living space, and in November 2024, we launched the Sactionals Reclining Seat, an innovation that integrates advanced reclining technology and delivers unparalleled comfort and flexibility while maintaining the sleek, sophisticated aesthetic of our Sactionals.

Cu stomization is further enhanced with our specialty-shaped modular offerings, such as our wedge seat, angled sides and roll or swept arms.

In September 2024, we launched the AnyTable ® , a versatile table that seamlessly enhances any Sactionals living space, and in November 2024, we launched the Sactionals Reclining Seat, an innovation that integrates advanced reclining technology and delivers unparalleled comfort and flexibility while maintaining the sleek, sophisticated aesthetic of our Sactionals.

Our custom features and accessories can be added easily and quickly to a Sactional to meet endless design, style, storage and utility preferences, reflecting our Designed for Life philosophy.

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Their removable covers are machine washable and may be easily replaced with a wide selection of cover offerings.

In May 2024, we launched the PillowSac TM Accent Chair Frame, an accessory that elevates the style and comfort of our existing PillowSac.

In May 2024, we launched the PillowSac Chair, an accessory that elevates the style and comfort of our existing PillowSac.

In October 2025, the Company launched the PillowSac Chair Jr., which delivers the same comfort and premium materials as the PillowSac Chair, scaled for smaller spaces.

Our Sacs represented 6.1%, 7.2% and 7.4% of our net sales for fiscal 2026, 2025 and 2024, respectively.

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These products provide our customers with the flexibility to personalize their furnishings with both decorative and practical add-ons, ensuring they can adapt to meet changing style preferences.

In May 2025, the Company launched Snugg (previously referred to as EverCouch™), a new platform of premium seating.

Snugg combines the familiar shape of a sofa, loveseat, or chair with durable quality and flexible design.

Similar to Lovesac’s Sactionals seating solution, Snugg includes washable fabrics, changeable covers, adaptable arm styles, and customizable fill.

Snugg can be moved as a single unit like a traditional couch, or disassembled and reassembled for easier transport, providing comfortable seating and a versatile fit for a range of spaces.

Sales Channels

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• Showrooms .

We market and sell our products through 257 showroom locations at top tier malls, lifestyle centers, mobile concierge, kiosk, and street locations in 42 states in the U.S.

We carefully select the best small-footprint showroom locations in high-end malls and lifestyle centers for our showrooms.

Compared to traditional retailers, our showrooms require significantly less square footage because of our need to have only a few in-store sample configurations for display and our ability to stock our inventory for immediate sale.

The architecture and layout of these showrooms is designed to communicate our brand personality and key product features.

We market and sell our products through 278 showroom locations strategically situated at top tier malls, lifestyle centers, and street locations in 45 states in the U.S.

We carefully select what we believe are the best small-footprint showroom locations in high-end malls and lifestyle centers for our showrooms.

Compared to traditional retailers, our showrooms require significantly less square footage because of our need to have only a few in-showroom sample configurations for display and our ability to stock our inventory for immediate sale.

The architecture and layout of these showrooms are designed to communicate our brand personality and key product features.

Our goal is to educate first-time customers, creating an environment where people can touch, feel, read, and understand the technology behind our products.

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We believe our robust technological capabilities position us well to benefit from the growing consumer preference to transact at home and via mobile devices.

With furniture especially suited to ecommerce applications, our net sales generated by this channel accounted for 28.8%, 28.5% and 27.1% of total net sales for fiscal 2025, 2024 and 2023, respectively.

Our net sales generated by this channel accounted for 27.6%, 28.8% and 28.5% of total net sales for fiscal 2026, 2025 and 2024, respectively.

• Other touchpoints .

We augment our showrooms with other touchpoint strategies including online and in store pop-up-shops, shop-in-shops, and barter inventory transactions.

We augment our showrooms with other touchpoint strategies including online and in store pop-up-shops, shop-in-shops, barter inventory transactions, and the Loved by Lovesac program.

◦ In store and online pop-up-shops .

We utilize in store pop-up-shops to increase the number of locations where customers can experience and purchase our products, a low cost alternative to drive brand awareness, in store sales, and ecommerce sales.

These in store pop-up-shops are typically 10-day shows and are staffed similarly to our showrooms with associates trained to demonstrate and sell our products and promote our brand.

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Shop-in-shops require less capital expenditure to open a productive space to drive brand awareness and touchpoint opportunities for demonstrating and selling our products.

As of February 2, 2025 and February 4, 2024, we operated 49 and 44 Best Buy shop-in-shops, respectively.

In June 2025, the Company discontinued its partnership with Best Buy, resulting in the closure of all remaining Best Buy shop-in-shop locations as of February 1, 2026.

Prior to the discontinuation of the partnership, we operated 49 Best Buy shop-in-shops as of February 2, 2025.

◦ Barter inventory transactions .

Our barter inventory transactions with a third party vendor are part of our Circle Operations ("CO"), Designed for Life, and Environmental, Social and Governance ("ESG") initiatives.

Our barter inventory transactions with a third party vendor are part of our Circular Operations ("CO"), Designed for Life, and Environmental, Social and Governance ("ESG") initiatives.

CO is a way of doing business that is meant to reduce our footprint, while dramatically extending the life of products through more looped, localized, long-term, and sustainable practices, policies, and programs.

We repurpose returned open-box inventory in exchange for media credits, which are being used to support our advertising initiatives to create brand awareness and drive net sales growth.

Other net sales, which includes pop-up-shop sales, shop-in-shop sales, and barter inventory transactions, accounted for 8.6%, 9.0% and 11.7% of total net sales for fiscal 2025, 2024 and 2023, respectively.

Our barter inventory arrangement permits us from time to time to repurpose

returned open-box inventory in exchange for media credits, which are being used to support our advertising initiatives to create brand awareness and drive net sales growth.

Basis of Presentation, and Summary of Significant Accounting Policies in the Notes to the Financial Statements included in Part IV of this report for more information about our unused media credits as of February 1, 2026.

◦ Loved by Lovesac.

In June 2025, we launched the Loved by Lovesac program which enables customers to purchase quality-assured, revitalized open-box products through our dedicated resale platform at www.lovedbylovesac.com.

All items are inspected and verified for resale prior to listing.

We believe this initiative aligns with our Designed for Life philosophy and supports our commitment to sustainability by extending the lifecycle of our products and reducing environmental impact.

The Company has initiated a limited launch of Loved by Lovesac, which as of February 1, 2026, is available in 29 select states nationwide.

Other net sales, which includes pop-up-shop sales, shop-in-shop sales, barter inventory transactions, and the Loved by Lovesac program, accounted for 5.3%, 8.6% and 9.0% of total net sales for fiscal 2026, 2025 and 2024, respectively.

Our Designed for Life products provide flexibility, upgrade ability and sustainability, elements that attract a wide customer base and can change as their life changes.

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We consider this to be an attractive demographic because of its higher than average rates of household formation and furniture purchasing.

Since 2020, we have experienced growth in new customer transactions from our target customers and beyond, demonstrating the expansive relatability and demand of our products.

• Customer Lifetime Value.

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From inception, we have focused on developing unique, innovative and proprietary product platforms.

We deploy a dual strategy of continuously researching and product invention and designing.

We deploy a dual strategy that combines continuous research with product innovation.

We are continuously expanding and introducing new extensions to these platforms to broaden the appeal, grow the addressable market of our product offerings and ultimately continue to grow and evolve with our customers’ needs.

We continually evaluate new products to complement our Sactionals and Sac lines and are currently developing accessories for the tech-savvy consumer.

Our patented StealthTech Sound + Charge product line is a unique innovation that features immersive surround sound by Harman Kardon and convenient wireless charging, all seamlessly embedded and hidden inside the adaptable Sactionals platform.

The System includes two Sound + Charge Sides each with embedded front- and rear-firing Harman Kardon speakers, a Subwoofer that easily integrates into a Sactionals Seat Frame and a Center Channel, all working in unison to deliver captivating surround sound that is completely hidden from view.

In fiscal year 2024, we introduced Satellite Subwoofers as an add-on to the Sound + Charge System.

The Satellite Subwoofer upgrades your existing StealthTech setup to enhance the bass and your overall entertainment experience.

In fiscal year 2025, we continued to build on our strategy of innovation

with the launches of the PillowSac TM Accent Chair, AnyTable TM , Sactionals Reclining Seat, and StealthTech Charge Side.

We continually evaluate new products to complement our Sactionals and Sac lines and are currently developing accessories for the tech-savvy consumer such as StealthTech Sound + Charge product line and related innovations.

In fiscal year 2026, we launched a new platform of premium seating called Snugg, as well as the PillowSac Chair Jr.

As we continue to grow our business and add additional showrooms in strategic locations across the United States, we seek the ability to service more customers locally with area-designated representatives who will shift their efforts between our showrooms and customers’ homes.

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Our products are positioned in the premium couch segment of the furniture market.

We market as premium products because of our proprietary foam fillings, higher quality materials, our unique Designed For Life design philosophy, and unique Circle Operations operating philosophy requiring a distinct level of manufacturing and service capabilities.

We market as premium products because of our proprietary foam fillings, higher quality materials, our unique Designed For Life design philosophy, and unique Circular Operations operating philosophy, requiring a distinct level of manufacturing and service capabilities.

At our price point, we offer a unique value proposition that combines both beautiful aesthetics and utility to our customers that we believe our competitors cannot offer.

Additionally, our high-end branding strategy, further enhanced by our celebrity endorsements and large social media following, commands premium pricing, as we feel lowering prices may negatively affect the perception of our products.

The difference is explained by our platform approach, where once a customer buys their first couch, the cost of expanding and adding to it over time drives more value than the traditional method of purchasing another new couch to replace the old one.

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We manage a global supply chain of highly vetted and qualified, third-party manufacturing partners to produce our products.

Our partners operate facilities located in Vietnam, China, Malaysia, Indonesia, Mexico, Taiwan, India, and the United States.

Our partners operate facilities located in Vietnam, Malaysia, China, Indonesia, Taiwan, India, and the United States.

We do not currently own or operate any manufacturing facilities as we believe our partners’ facilities are sufficient to meet our current demand and will be able to meet any additional demand in the future.

We do, however, expect to invest in additional domestic manufacturing capabilities to support supply chain redundancy for certain of our products.

As previously announced, we expect to invest in additional domestic manufacturing capabilities to support supply chain redundancy for our Sactional products.

Additionally, we work closely with our manufacturing partners regarding product quality and manufacturing process efficiency.

To mitigate the concentration risk in our supply chain, we have and continue to pursue a higher diversification of manufacturing partners, with both sourcing, tariff, and geographical advantages.

We expect that our efforts to onshore our sourcing of Sactionals will be cost-neutral after the initial ramp-up occurs.

Logistics and Distribution

We are able to efficiently distribute and ship our products to our customers.

Due to the unique modularity of our Sactionals products and the ability to shrink our Sacs, we are able to distribute our products through nationwide express couriers and efficiently utilize warehouse space and international shipping routes.

Due to the unique modularity of our Sactionals products, the compact design of our Snugg and the ability to shrink our Sacs, we are able to distribute our products through nationwide express couriers and efficiently utilize warehouse space and international shipping routes.

We believe our Sactionals are the only product in its category that enjoys this logistical advantage.

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Intellectual Property

W e own 41 U.S.

We own 52 U.S.

federal trademark registrations, 303 foreign trademark registrations, and a number of U.S.

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Some of our registered U.S.

trademarks include registrations for

Lovesac ® , Designed for Life ®, DFL®, Sactionals ® , SAC ® , StealthTech ®, Moviesac ® , Squattoman ® , Total Comfort ® , Footsac ® , The World’s Most Comfortable Seat ® , and The World’s Most Adaptable Couch ® .

Our trademarks, if not renewed, are scheduled to expire between calendar years 2024 and 2035.

trademarks include registrations for Lovesac ® , Designed for Life ®, DFL®, Sactionals ® , SAC ® , StealthTech ®, Moviesac ® , Squattoman ® , Total Comfort ® , Footsac ® , The World’s Most Comfortable Seat ® , and The World’s Most Adaptable Couch ® .

Our trademarks, if not abandoned, are scheduled to expire between calendar years 2026 and 2036.

In order to maintain our U.S.

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We have 55 issued U.S.

utility patents and 63 issued foreign utility patents, that are scheduled to expire between 2025 and 2042.

utility patents and 85 issued foreign utility patents, that expire between 2035 and 2043.

Our Sactional technology patents include our proprietary geometric modular system and segmented bi-coupling technology.

Our StealthTech technology patents include our proprietary sound and entertainment system.

We have patents covering the ornamental appearance of our product lines.

We also have multiple patents pending and expect to file patent applications for future innovations.

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To achieve these standards, we strive for all of our products to meet or exceed performance requirements for product durability, safety, and consumer satisfaction through rigorous safety inspections.

In December 2024, we published our fourth annual Environmental, Social, and Governance (ESG) report aligned with the guidance of the Sustainability Accounting Standards Board (SASB).

In December 2025, we published our fifth annual Environmental, Social, and Governance (ESG) report aligned with the guidance of the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD).

We believe that transparently disclosing the goals and metrics pertinent to our ESG programs will grant our stakeholders continued visibility of our progress.

To that end, we expect to update this report annually for consistent transparency of our evolving ESG strategy and related efforts.

Our most recent ESG report is available at:

https://investor.lovesac.com/esg.

The contents of our website and our ESG Report are not incorporated by reference in this Form 10-K.

Environmental Compliance

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For associates supporting our showrooms, we implemented specific protocols to ensure the safety of our associates and our customers.

As of February 2, 2025, we had 920 full-time associates and 1,104 part-time associates, and we contracted with twenty-five independent contractors.

As of February 1, 2026, we had 917 full-time associates and 965 part-time associates, and we contracted with eighteen independent contractors.

All associates and contractors are subject to contractual agreements that specify, among other things, requirements for confidentiality, ownership of newly developed intellectual property and restrictions on working for competitors as well as other matters.

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We believe in meritocratic hiring of A players with the necessary skills and talent to move us into the next chapter and rewarding Associates for performance.

In fiscal 2025, we focused on the behaviors that will help mitigate bias throughout the employee experience to enable people of all identities and backgrounds to feel welcome and do their best work.

In fiscal 2026, we continued to focus on the behaviors that will help mitigate bias throughout the employee experience to enable people of all identities and backgrounds to feel welcome and do their best work.

We maintained our steering committee of senior leaders and an action council of associates that direct and enable our belonging initiatives.

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federal, state and foreign laws and regulations covering a variety of subject matters, many of which are evolving.

These laws and regulations involve matters including privacy, data use, data protection and personal information, intellectual property, anti-spam, consumer credit offerings, content protection, electronic contracts and communications (such as “do not call/mail” and text messaging requirements), consumer protection, pricing transparency and false advertising, use of artificial intelligence, Internet neutrality, product liability and labeling, ecommerce, taxation, environmental, safety, economic or other trade prohibitions, sanctions, or tarrifs, anti-corruption and political law compliance, securities law compliance, and online payment services.

These laws and regulations involve matters including privacy, data use, data protection and personal information, intellectual property, anti-spam, consumer credit offerings, content protection, electronic contracts and communications (such as “do not call/mail” and text messaging requirements), consumer protection, pricing transparency and false advertising, use of artificial intelligence, Internet neutrality, product liability and labeling, ecommerce, taxation, environmental, safety, economic or other trade prohibitions, sanctions, or tariffs, anti-corruption and political law compliance, securities law compliance, and online payment services.

Our compliance with these laws and regulations may be onerous and could, individually or in the aggregate, increase our cost of doing business and/or otherwise have an adverse impact on our business, reputation, financial condition, and operating results.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business