The Lovesac Company (LOVE) 10-Q 3 Nov 23 2024 Q2 Quarterly report Financial data

Cover

Cover - shares	6 Months Ended
	Jul. 30, 2023	Oct. 31, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jul. 30, 2023
Document Transition Report	false
Entity File Number	001-38555
Entity Registrant Name	THE LOVESAC COMPANY
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	32-0514958
Entity Address, Address Line One	Two Landmark Square
Entity Address, Address Line Two	Suite 300
Entity Address, City or Town	Stamford
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06901
City Area Code	888
Local Phone Number	636-1223
Title of 12(b) Security	Common Stock, $0.00001 par value per share
Trading Symbol	LOVE
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		15,486,187
Amendment Flag	false
Entity Central Index Key	0001701758
Current Fiscal Year End Date	--02-04
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2

Condensed Balance Sheets

Condensed Balance Sheets - USD ($)	Jul. 30, 2023	Jan. 29, 2023
Current Assets
Cash and cash equivalents	$ 54,716,000	$ 43,533,000
Trade accounts receivable	7,994,000	9,103,000
Merchandise inventories, net	104,970,000	119,627,000
Prepaid expenses and other current assets	15,947,000	15,452,000
Total Current Assets	183,627,000	187,715,000
Property and equipment, net	63,079,000	52,904,000
Operating lease right-of-use assets	149,285,000	135,411,000
Other Assets
Goodwill	144,000	144,000
Intangible assets, net	1,474,000	1,411,000
Deferred tax asset	10,075,000	8,677,000
Other assets	25,882,000	22,364,000
Total Other Assets	37,575,000	32,596,000
Total Assets	433,566,000	408,626,000
Current Liabilities
Accounts payable	33,858,000	24,576,000
Accrued expenses	24,984,000	25,417,000
Payroll payable	6,239,000	6,783,000
Customer deposits	12,279,000	6,760,000
Current operating lease liabilities	16,072,000	13,075,000
Sales taxes payable	3,910,000	5,430,000
Total Current Liabilities	97,342,000	82,041,000
Operating Lease Liability, long-term	149,431,000	133,491,000
Line of Credit	0	0
Total Liabilities	246,773,000	215,532,000
Commitments and Contingencies (see Note 6)
Stockholders’ Equity
Preferred Stock $0.00001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of July 30, 2023 and January 29, 2023.	0	0
Common Stock $.00001 par value, 40,000,000 shares authorized, 15,481,925 shares issued and outstanding as of July 30, 2023 and 15,195,698 shares issued and outstanding as of January 29, 2023.	0	0
Additional paid-in capital	181,003,000	182,554,000
Accumulated earnings	5,790,000	10,540,000
Stockholders' Equity	186,793,000	193,094,000
Total Liabilities and Stockholders' Equity	$ 433,566,000	$ 408,626,000

Condensed Balance Sheets (Paren

Condensed Balance Sheets (Parentheticals) - $ / shares	Jul. 30, 2023	Jan. 29, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Common stock, shares authorized (in shares)	40,000,000	40,000,000
Common stock, shares issued (in shares)	15,481,925	15,195,698
Common stock, shares outstanding (in shares)	15,481,925	15,195,698

Condensed Statements of Operati

Condensed Statements of Operations - USD ($)	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022
Income Statement [Abstract]
Net sales	$ 154,529,000	$ 148,534,000	$ 295,722,000	$ 277,914,000
Cost of merchandise sold	62,139,000	69,435,000	132,757,000	132,841,000
Gross profit	92,390,000	79,099,000	162,965,000	145,073,000
Operating expenses
Selling, general and administration expenses	63,834,000	48,815,000	120,380,000	93,733,000
Advertising and marketing	26,535,000	19,088,000	43,448,000	34,989,000
Depreciation and amortization	3,014,000	3,076,000	5,836,000	5,737,000
Total operating expenses	93,383,000	70,979,000	169,664,000	134,459,000
Operating (loss) income	(993,000)	8,120,000	(6,699,000)	10,614,000
Interest income (expense), net	351,000	3,000	692,000	(32,000)
Net (loss) income before taxes	(642,000)	8,123,000	(6,007,000)	10,582,000
Benefit from (provision for) income taxes	7,000	(2,274,000)	1,257,000	(2,947,000)
Net (loss) income	$ (635,000)	$ 5,849,000	$ (4,750,000)	$ 7,635,000
Net (loss) income per common share:
Basic (in dollars per share)	$ (0.04)	$ 0.38	$ (0.31)	$ 0.50
Diluted (in dollars per share)	$ (0.04)	$ 0.37	$ (0.31)	$ 0.48
Weighted average shares outstanding:
Basic (in shares)	15,422,640	15,195,116	15,326,702	15,175,247
Diluted (in shares)	15,422,640	16,004,061	15,326,702	16,032,731

Condensed Statements of Changes

Condensed Statements of Changes in Stockholders' Equity - USD ($)	Total	Common	Additional paid-in capital	Accumulated (deficit) earnings
Beginning balance (in shares) at Jan. 30, 2022		15,123,338
Beginning balance at Jan. 30, 2022	$ 157,814,000	$ 0	$ 173,762,000	$ (15,948,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	1,786,000			1,786,000
Equity-based compensation	1,163,000		1,163,000
Vested restricted stock units (in shares)		1,704
Taxes paid for net share settlement of equity awards	(47,000)		(47,000)
Ending balance (in shares) at May. 01, 2022		15,125,042
Ending balance at May. 01, 2022	160,716,000	$ 0	174,878,000	(14,162,000)
Beginning balance (in shares) at Jan. 30, 2022		15,123,338
Beginning balance at Jan. 30, 2022	157,814,000	$ 0	173,762,000	(15,948,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	7,635,000
Ending balance (in shares) at Jul. 31, 2022		15,183,277
Ending balance at Jul. 31, 2022	166,197,000	$ 0	174,510,000	(8,313,000)
Beginning balance (in shares) at May. 01, 2022		15,125,042
Beginning balance at May. 01, 2022	160,716,000	$ 0	174,878,000	(14,162,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	5,849,000			5,849,000
Equity-based compensation	1,034,000		1,034,000
Vested restricted stock units (in shares)		58,235
Taxes paid for net share settlement of equity awards	(1,402,000)		(1,402,000)
Ending balance (in shares) at Jul. 31, 2022		15,183,277
Ending balance at Jul. 31, 2022	166,197,000	$ 0	174,510,000	(8,313,000)
Beginning balance (in shares) at Jan. 29, 2023		15,195,698
Beginning balance at Jan. 29, 2023	193,094,000	$ 0	182,554,000	10,540,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(4,115,000)			(4,115,000)
Equity-based compensation	747,000		747,000
Vested restricted stock units (in shares)		21,422
Taxes paid for net share settlement of equity awards	(470,000)		(470,000)
Ending balance (in shares) at Apr. 30, 2023		15,217,120
Ending balance at Apr. 30, 2023	189,256,000	$ 0	182,831,000	6,425,000
Beginning balance (in shares) at Jan. 29, 2023		15,195,698
Beginning balance at Jan. 29, 2023	193,094,000	$ 0	182,554,000	10,540,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(4,750,000)
Ending balance (in shares) at Jul. 30, 2023		15,481,925
Ending balance at Jul. 30, 2023	186,793,000	$ 0	181,003,000	5,790,000
Beginning balance (in shares) at Apr. 30, 2023		15,217,120
Beginning balance at Apr. 30, 2023	189,256,000	$ 0	182,831,000	6,425,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(635,000)			(635,000)
Equity-based compensation	1,290,000		1,290,000
Vested restricted stock units (in shares)		190,213
Exercise of warrants (in shares)		74,592
Taxes paid for net share settlement of equity awards	(3,118,000)
Ending balance (in shares) at Jul. 30, 2023		15,481,925
Ending balance at Jul. 30, 2023	$ 186,793,000	$ 0	$ 181,003,000	$ 5,790,000

Condensed Statement of Cash Flo

Condensed Statement of Cash Flows - USD ($)	6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022
Cash Flows from Operating Activities
Net (loss) income	$ (4,750,000)	$ 7,635,000
Adjustments to reconcile net (loss) income to cash provided by (used in) operating activities:
Depreciation and amortization of property and equipment	5,608,000	5,549,000
Amortization of other intangible assets	228,000	188,000
Amortization of deferred financing fees	81,000	71,000
Net loss on disposal of property and equipment	145,000	0
Equity based compensation	2,037,000	2,197,000
Non-cash operating lease cost	10,880,000	8,711,000
Deferred income taxes	(1,398,000)	2,313,000
Change in operating assets and liabilities:
Trade accounts receivable	1,109,000	(423,000)
Merchandise inventories	14,657,000	(37,199,000)
Prepaid expenses and other current assets	(524,000)	(16,510,000)
Other assets	(3,518,000)	(10,000)
Accounts payable and accrued expenses	3,087,000	(18,520,000)
Operating lease liabilities	(5,817,000)	(10,064,000)
Customer deposits	5,519,000	(6,828,000)
Net cash provided by (used in) operating activities	27,344,000	(62,890,000)
Cash Flows from Investing Activities
Purchase of property and equipment	(12,361,000)	(9,965,000)
Payments for patents and trademarks	(160,000)	(160,000)
Net cash used in investing activities	(12,521,000)	(10,125,000)
Cash Flows from Financing Activities
Taxes paid for net share settlement of equity awards	(3,588,000)	(1,449,000)
Payment of deferred financing costs	(52,000)	(276,000)
Net cash used in financing activities	(3,640,000)	(1,725,000)
Net change in cash and cash equivalents	11,183,000	(74,740,000)
Cash and cash equivalents - Beginning	43,533,000	92,392,000
Cash and cash equivalents - Ending	54,716,000	17,652,000
Supplemental Cash Flow Data:
Cash paid for taxes	1,232,000	9,393,000
Cash paid for interest	66,000	34,000
Non-cash investing activities:
Asset acquisitions not yet paid for at period end	$ 3,698,000	$ 3,536,000

Basis of Presentation and Summa

Basis of Presentation and Summary of Significant Accounting Policies	6 Months Ended
	Jul. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Summary of Significant Accounting Policies	Basis of Presentation and Summary of Significant Accounting Policies The balance sheet of The Lovesac Company (the “Company”, “we”, “us” or “our”) as of January 29, 2023, which has been derived from our audited financial statements as of and for the 52-week year ended January 29, 2023, and the accompanying interim unaudited condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. Certain information and note disclosures normally included in annual financial statements, prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), have been condensed or omitted pursuant to those rules and regulations. The financial information presented herein, which is not necessarily indicative of results to be expected for the full current fiscal year, reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the interim unaudited condensed financial statements. Such adjustments are of a normal, recurring nature. These condensed financial statements should be read in conjunction with the Company’s financial statements filed in its Amendment No. 1 to Annual Report on Form 10-K/A for the fiscal year ended January 29, 2023. Due to the seasonality of the Company’s business, with the majority of our activity occurring in the fourth quarter of each fiscal year, the results of operations for the thirteen and twenty-six weeks ended July 30, 2023 and July 31, 2022 are not necessarily indicative of results to be expected for the full fiscal year. Nature of Operations We are a technology driven company that designs, manufactures and sells unique, high quality furniture derived through its 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. The Company markets and sells its products through modern and efficient showrooms and, increasingly, through online net sales directly at www.lovesac.com, supported by direct-to-consumer touch-feel points in the form of our own showrooms, which include our newly created mobile concierge and kiosks, as well as through shop-in-shops and online pop-up-shops with third party retailers. As of July 30, 2023, the Company operated 223 showrooms including kiosks and mobile concierges located throughout the United States. The Company was formed as a Delaware corporation on January 3, 2017, in connection with a corporate reorganization with SAC Acquisition LLC, a Delaware limited liability company, the predecessor entity to the Company. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. The Company evaluates its estimates and judgements on an ongoing basis based on historical experience, expectations of future events and various other factors we believe to be reasonable under the circumstances and revise them when necessary in the period the change is determined. Actual results may differ from the original or revised estimates. Recent Accounting Pronouncements The Company has considered all recent accounting pronouncements issued by the Financial Accounting Standards Board and they were considered to be not applicable or the adoption of such pronouncements will not have a material impact on the financial statements. Employee Benefit Plan In February 2017, the Company established The Lovesac Company 401(k) Plan (the “401(k) Plan”) with Elective Deferrals beginning May 1, 2017. The 401(k) Plan calls for Elective Deferral Contributions, Safe Harbor Matching Contributions and Profit-Sharing Contributions. All associates of the Company will be eligible to participate in the 401(k) Plan as of the day of the month which is coincident with or next follows the date on which they attain age 21 and complete one month of service. Participants will be able to contribute up to 100% of their eligible compensation to the 401(k) Plan subject to limitations with the IRS. The Company's contributions to the 401(k) Plan were $0.3 million during the thirteen weeks ended July 30, 2023 and July 31, 2022, respectively, and $0.8 million and $0.7 million for the twenty-six weeks ended July 30, 2023 and July 31, 2022, respectively.

Revenue Recognition

Revenue Recognition	6 Months Ended
	Jul. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue Recognition	Revenue Recognition The Company’s revenue consists substantially of product net sales. The Company reports product net sales net of discounts and recognizes them at the point in time when control transfers to the customer, which generally occurs upon our delivery to a third-party carrier. Shipping and handling charges billed to customers are included in revenue. The Company recognizes shipping and handling expense as fulfillment activities (rather than a promised good or service) when the activities are performed. Accordingly, the Company records the expenses for shipping and handling activities at the same time the Company recognizes revenue. Shipping and handling costs incurred are included in cost of merchandise sold and include inbound freight and tariff costs relative to inventory sold, warehousing, and last mile shipping to our customers. Shipping and handling costs were $25.6 million and $35.3 million during the thirteen weeks ended July 30, 2023 and July 31, 2022, respectively, and $63.5 million and $70.3 million during the twenty-six weeks ended July 30, 2023 and July 31, 2022, respectively. Estimated refunds for returns and allowances are recorded using our historical return patterns, adjusting for any changes in returns policies. The Company records estimated refunds for net sales returns on a monthly basis as a reduction of net sales and cost of sales on the condensed statements of operations and an increase in inventory and customers returns liability on the condensed balance sheets. There was a returns allowance recorded on the condensed balance sheet in the amount of $3.1 million as of July 30, 2023 and $4.5 million as of January 29, 2023, which was included in accrued expenses and $0.7 million as of July 30, 2023 and $1.0 million as of January 29, 2023, associated with sales returns included in merchandise inventories. In some cases, deposits are received before the Company transfers control, resulting in contract liabilities. These contract liabilities are reported as customer deposits on the Company’s condensed balance sheet. As of July 30, 2023 and January 29, 2023, the Company recorded under customer deposit liabilities the amount of $12.3 million and $6.8 million respectively. During the twenty-six weeks ended July 30, 2023 and July 31, 2022, the Company recognized approximately $6.8 million and $13.3 million, respectively, that was included in the customer deposit liabilities as of January 29, 2023 and January 30, 2022. The Company offers its products through an inventory lean omni-channel platform that provides a seamless and meaningful experience to its customers in showrooms, which includes mobile concierge and kiosks, and through the internet. The Other channel predominantly represents net sales through the use of online pop-up-shops and shop-in-shops that are staffed with associates trained to demonstrate and sell our product. The following represents net sales disaggregated by channel: Thirteen weeks ended Twenty-six weeks ended (amounts in thousands) July 30, July 31, July 30, July 31, Showrooms $ 98,226 $ 92,426 $ 181,800 $ 173,680 Internet 41,425 35,534 81,650 66,789 Other 14,878 20,574 32,272 37,445 $ 154,529 $ 148,534 $ 295,722 $ 277,914 The Company has no foreign operations and its net sales to foreign countries was less than .01% of total net sales in both fiscal 2024 and 2023. The Company had no customers that comprise more than 10% of total net sales for the thirteen weeks ended July 30, 2023 and July 31, 2022. See Note 9 for sales disaggregated by product . Barter Arrangements The Company has a bartering arrangement with a third-party vendor. The Company repurposes 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. Barter transactions with commercial substance are recorded at a transaction price based on the estimated fair value of the non-cash consideration of the media credits to be received and the revenue is recognized when control of inventory is transferred, which is when the inventory is picked up in our warehouse. Fair value is estimated using various considerations, including the cost of similar media advertising if transacted directly, the expected sales price of product given up in exchange for the media credits, and the expected usage of media credits prior to expiration based on a marketing spend forecast. The Company recognizes an asset for media credits which is subsequently evaluated for impairment at each reporting period for any changes in circumstances. As the barter credits are expected to be utilized at various dates through their expiration dates, the Company will classify the amount expected to be utilized in the next fiscal year as current, which is included in Prepaid and Other Current Assets, with the remaining balance included as part of Other Assets on the balance sheet. The Company recognized barter sales in exchange for media credits of $2.8 million and $9.5 million during the thirteen weeks ended July 30, 2023 and July 31, 2022, respectively, and $6.9 million and $12.1 million during the twenty-six weeks ended July 30, 2023 and July 31, 2022, respectively.

Income Taxes

Income Taxes	6 Months Ended
	Jul. 30, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes For the thirteen weeks ended July 30, 2023 and July 31, 2022, the Company recorded an income tax benefit of less than $0.1 million and income tax expense of $2.3 million, respectively, which reflects an effective tax rate of 1.0% and 28.0%, respectively. For the twenty-six weeks ended July 30, 2023 and July 31, 2022, the Company recorded an income tax benefit of $1.3 million and income tax expense of $2.9 million, respectively, which reflects an effective tax rate of 20.9% and 27.8%, respectively. The effective tax rate for the thirteen and twenty-six weeks ended July 30, 2023 and July 31, 2022 varies from the 21% federal statutory tax rate primarily due to state taxes. The Company does not anticipate any material adjustments relating to unrecognized tax benefits within the next twelve months; however, the ultimate outcome of tax matters is uncertain and unforeseen results can occur. The Company had no material interest or penalties during the thirteen and twenty-six weeks ended July 30, 2023 and July 31, 2022, respectively, and does not anticipate any such items during the next twelve months. The Company's policy is to record interest and penalties directly related to uncertain tax positions as income tax expense in the condensed statements of operations.

Basic and Diluted Net (Loss) In

Basic and Diluted Net (Loss) Income Per Common Share	6 Months Ended
	Jul. 30, 2023
Earnings Per Share [Abstract]
Basic and Diluted Net (Loss) Income Per Common Share	Basic and Diluted Net (Loss) Income Per Common Share Basic net (loss) income per common share is computed by dividing net (loss) income by the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number of common shares outstanding and common stock equivalents outstanding during the period. Diluted net income per common share includes, in periods in which they are dilutive, the effect of those potentially dilutive securities where the average market price of the common stock exceeds the exercise prices for the respective periods. In periods of loss, there are no potentially dilutive common shares to add to the weighted average number of common shares outstanding. For the thirteen weeks ended July 30, 2023, the effects of 1,060,705 shares of common stock related to restricted stock units and 495,366 shares of common stock underlying stock options were excluded from the diluted net loss per share calculation because the effect of including these potentially dilutive shares was antidilutive. For the twenty-six weeks ended July 30, 2023, the effects of 1,060,705 shares of common stock related to restricted stock units and 495,366 shares of common stock underlying stock options were excluded from the diluted net loss per share calculation because the effect of including these potentially dilutive shares was antidilutive. For the thirteen weeks ended July 31, 2022, the effects of 687,528 shares of common stock related to restricted stock units, and warrants to purchase 281,750 shares of common stock were included in the diluted share calculation and there were 495,366 shares of common stock underlying stock options of potentially dilutive shares which may be issued in the future that were excluded from the diluted net income per share calculation because the effect of including these potentially dilutive shares was antidilutive. For the twenty-six weeks ended July 31, 2022, the effects of 687,528 shares of common stock related to restricted stock units, 495,366 shares of common stock underlying stock options, and warrants to purchase 281,750 shares of common stock were included in the diluted share calculation and there were no anti-dilutive awards during the period.

Leases

Leases	6 Months Ended
	Jul. 30, 2023
Leases [Abstract]
Leases	Leases Components of lease expense were as follows (in thousands): Thirteen weeks ended Twenty-six weeks ended July 30, 2023 July 31, 2022 July 30, 2023 July 31, 2022 Operating lease expense $ 7,391 $ 5,808 $ 14,395 $ 11,142 Variable lease expense 2,486 3,991 4,542 6,205 Short term lease expense 407 180 647 359 Total lease expense $ 10,284 $ 9,979 $ 19,584 $ 17,706 Variable lease expense includes index-based changes in rent, maintenance, real estate taxes, insurance and other variable charges. We did not recognize any impairment charges associated with showroom-level right-of-use assets during the thirteen and twenty-six weeks ended July 30, 2023 or July 31, 2022. Future minimum lease payments under non-cancelable leases as of July 30, 2023 were as follows (in thousands): (amounts in thousands) 2024 $ 7,896 2025 30,562 2026 28,231 2027 25,946 2028 23,692 Thereafter 82,929 Total undiscounted future minimum lease payments 199,256 Less: imputed interest (33,753) Total present value of lease obligations 165,503 Less: current operating lease liability (16,072) Operating lease liability- long term $ 149,431 Supplemental information related to our operating leases is as follows (in thousands): Twenty-six weeks ended (amounts in thousands) July 30, 2023 July 31, 2022 Operating cash flow information: Amounts paid on operating lease liabilities $ 14,208 $ 8,501 Non-cash activities: Right-of-use assets obtained in exchange for lease obligations $ 24,676 $ 20,702 Weighted average remaining lease term - operating leases 7.6 years 7.3 years Weighted average discount rate - operating leases 4.55 % 4.01 %

Commitment and Contingencies

Commitment and Contingencies	6 Months Ended
	Jul. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Legal Proceedings The Company is involved in various legal proceedings in the ordinary course of business. Management cannot presently predict the outcome of these matters, although management believes, based in part on the advice of counsel, that the ultimate resolution of these matters will not have a materially adverse effect on the Company’s condensed financial position, results of operations or cash flows. The Company has voluntarily self-reported to the SEC information concerning the internal investigation of the accounting matters that led to the restatement of its previously issued audited financial statements as of and for the year ended January 29, 2023 and our unaudited condensed financial statements for the quarterly periods ended April 30, 2023, October 30, 2022, July 31, 2022 and May 1, 2022. As a result of self-reporting, the Company is the subject of an ongoing, non-public investigation by the SEC. The Company is cooperating fully with the SEC in its investigation and continues to respond to requests in connection with this matter. The investigation could result in the SEC seeking various penalties and relief including, without limitation, civil injunctive relief and/or civil monetary penalties or administrative relief. The nature of the relief or remedies the SEC may seek with respect to the Company, if any, cannot be predicted at this time.

Financing Arrangements

Financing Arrangements	6 Months Ended
	Jul. 30, 2023
Line of Credit Facility [Abstract]
Financing Arrangements	Financing Arrangements The Company has a line of credit with Wells Fargo Bank, National Association (“Wells”). On March 25, 2022, the line of credit with Wells was amended and increased from $25 million to allow the Company to borrow up to $40.0 million, subject to borrowing base and availability restrictions, and will mature in March 2024. Borrowings are limited to 90% of eligible credit card receivables plus 85% of eligible wholesale receivables plus 85% of the net recovery percentage for the eligible inventory multiplied by the value of such eligible inventory of the Company for the period from December 16 of each year until October 14 of the immediately following year, with a seasonal increase to 90% of the net recovery percentage for the period from October 15 of each year until December 15 of such year, seasonal advance rate, minus applicable reserves established by Wells. The amended agreement contains a financial covenant that requires us to maintain undrawn availability under the credit facility of at least 10% of the lesser of (i) the aggregate commitments in the amount of $40.0 million and (ii) the amounts available under the credit facility based on eligible accounts receivable and inventory. On March 24, 2023, the Company amended the credit agreement to extend the maturity date to September 2024. All other terms of the credit agreement remain unchanged. As of July 30, 2023 and January 29, 2023, the Company’s borrowing availability under the line of credit with Wells was $36.0 million. As of July 30, 2023 and January 29, 2023, there were no borrowings outstanding on this line of credit.

Stockholders' Equity

Stockholders' Equity	6 Months Ended
	Jul. 30, 2023
Stockholders' Equity Note [Abstract]
Stockholders' Equity	Stockholders' Equity Common Stock Warrants On June 29, 2018, the Company issued 281,750 warrants with a five-year term to Roth Capital Partners, LLC as part of the underwriting agreement in connection with the Company's IPO. Warrants may be exercised on a cashless basis, where the holders receive fewer shares of common stock in lieu of a cash payment to the Company. There were no warrants issued, exercised, or expired and canceled for the twenty-six weeks ended July 31, 2022. As of July 31, 2022, 281,750 warrants remained outstanding with an average exercise price of $19.20 and a weighted average remaining contractual life of 0.91 years. On June 26, 2023, Roth Capital Partners, LLC performed a cashless exercise of all 281,750 remaining outstanding warrants resulting in 74,592 net shares issued. As of July 30, 2023, no warrants remain outstanding. Equity Incentive Plan The Company adopted the Amended and Restated 2017 Equity Incentive Plan (the “2017 Equity Plan”) which provides for awards in the form of stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance shares, performance units, cash-based awards and other stock-based awards. All awards shall be granted within 10 years from the effective date of the 2017 Equity Plan. In fiscal 2024, the 2017 Equity Plan was amended and restated to increase the shares of our common stock authorized and reserved for issuance by 225,000 shares, which increased the number of shares of common stock reserved for issuance under the 2017 Equity Plan to 2,879,889 shares of common stock as of July 30, 2023. Stock Options In June 2019, the Company granted 495,366 non-statutory stock options to certain officers of the Company with an option price of $38.10 per share. 100% of the stock options are subject to vesting on the third anniversary of the date of grant if the officers are still employed by the Company and the average closing price of the Company’s common stock for the prior 40 consecutive trading days has been at least $75 by the third anniversary of the grant. Both the employment and the market condition must be satisfied no later than June 5, 2024 or the options will terminate. These options were valued using a Monte Carlo simulation model to account for the path dependent market conditions that stipulate when and whether or not the options shall vest. The 495,366 stock options were modified in fiscal 2022 to extend the term of the options through June 5, 2024. This resulted in additional compensation of approximately $0.9 million of which, $0.3 million was recorded upon modification with the remaining expense to be recognized over the remaining expected term. The market condition was met on June 5, 2021, which was the date on which the average closing price of the Company’s common stock had been at least $75 for 40 consecutive trading days. The options vested and became exercisable on June 5, 2022 as the officers were still employed on that date. There were no stock options issued, exercised, or expired and canceled for the twenty-six weeks ended July 30, 2023 and July 31, 2022. As of July 30, 2023, 495,366 stock options remain outstanding with a weighted average exercise price of $38.10, a weighted average remaining contractual life of 0.85 years, and no intrinsic value. As of July 31, 2022, 495,366 stock options remain outstanding with a weighted average exercise price of $38.10, a weighted average remaining contractual life of 1.85 years and intrinsic value of $1.89. Restricted Stock Units A summary of the status of our unvested restricted stock units as of July 30, 2023 and July 31, 2022, and changes during the twenty-six weeks ended, is presented below: Number of shares Weighted average grant date fair value Unvested at January 30, 2022 533,333 $ 28.41 Granted 278,087 45.58 Forfeited (21,243) 23.12 Vested (102,649) 34.86 Unvested at July 31, 2022 687,528 $ 34.87 Number of shares Weighted average grant date fair value Unvested at January 29, 2023 640,256 $ 34.50 Granted 815,340 26.76 Forfeited (25,874) 35.32 Vested (369,017) 24.37 Unvested at July 30, 2023 1,060,705 $ 32.05 For the thirteen weeks ended July 30, 2023 and July 31, 2022, the Company recognized equity based compensation expense of $1.3 million and $1.0 million, respectively, and for the twenty-six weeks ended July 30, 2023 and July 31, 2022, the Company recognized equity based compensation expense of $2.0 million and $2.2 million, respectively. The total unrecognized equity-based compensation cost related to unvested stock option and restricted unit awards was approximately $11.0 million as of July 30, 2023 and will be recognized in operations over a weighted average period of 3.9 years.

Segment Information

Segment Information	6 Months Ended
	Jul. 30, 2023
Segment Reporting [Abstract]
Segment Information	Segment Information Segments are reflective of how the chief operating decision maker ("CODM") reviews operating results for the purpose of allocating resources and assessing performance. The CODM group of the Company are the Chief Executive Officer and the President and Chief Operating Officer. The Company's operating segments are the sales channels, which share similar economic and other qualitative characteristics, and are aggregated together as one reportable segment. The Company’s sales by product which are considered one segment are as follows: Thirteen weeks ended Twenty-six weeks ended July 30, July 31, July 30, July 31, (amounts in thousands) Sactionals $ 140,507 $ 136,513 $ 268,413 $ 251,515 Sacs 11,663 9,908 22,399 21,835 Other 2,359 2,113 4,910 4,564 $ 154,529 $ 148,534 $ 295,722 $ 277,914

Basis of Presentation and Sum_2

Basis of Presentation and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jul. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. The Company evaluates its estimates and judgements on an ongoing basis based on historical experience, expectations of future events and various other factors we believe to be reasonable under the circumstances and revise them when necessary in the period the change is determined. Actual results may differ from the original or revised estimates.
Recent Accounting Pronouncements	Recent Accounting PronouncementsThe Company has considered all recent accounting pronouncements issued by the Financial Accounting Standards Board and they were considered to be not applicable or the adoption of such pronouncements will not have a material impact on the financial statements.
Employee Benefit Plan	Employee Benefit PlanIn February 2017, the Company established The Lovesac Company 401(k) Plan (the “401(k) Plan”) with Elective Deferrals beginning May 1, 2017. The 401(k) Plan calls for Elective Deferral Contributions, Safe Harbor Matching Contributions and Profit-Sharing Contributions. All associates of the Company will be eligible to participate in the 401(k) Plan as of the day of the month which is coincident with or next follows the date on which they attain age 21 and complete one month of service. Participants will be able to contribute up to 100% of their eligible compensation to the 401(k) Plan subject to limitations with the IRS.
Shipping And Handling Charges	Shipping and handling charges billed to customers are included in revenue. The Company recognizes shipping and handling expense as fulfillment activities (rather than a promised good or service) when the activities are performed. Accordingly, the Company records the expenses for shipping and handling activities at the same time the Company recognizes revenue. Shipping and handling costs incurred are included in cost of merchandise sold and include inbound freight and tariff costs relative to inventory sold, warehousing, and last mile shipping to our customers.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	6 Months Ended
	Jul. 30, 2023
Revenue from Contract with Customer [Abstract]
Schedule of sales disaggregated by channel	The following represents net sales disaggregated by channel: Thirteen weeks ended Twenty-six weeks ended (amounts in thousands) July 30, July 31, July 30, July 31, Showrooms $ 98,226 $ 92,426 $ 181,800 $ 173,680 Internet 41,425 35,534 81,650 66,789 Other 14,878 20,574 32,272 37,445 $ 154,529 $ 148,534 $ 295,722 $ 277,914

Leases (Tables)

Leases (Tables)	6 Months Ended
	Jul. 30, 2023
Leases [Abstract]
Schedule of components of lease expense	Components of lease expense were as follows (in thousands): Thirteen weeks ended Twenty-six weeks ended July 30, 2023 July 31, 2022 July 30, 2023 July 31, 2022 Operating lease expense $ 7,391 $ 5,808 $ 14,395 $ 11,142 Variable lease expense 2,486 3,991 4,542 6,205 Short term lease expense 407 180 647 359 Total lease expense $ 10,284 $ 9,979 $ 19,584 $ 17,706
Schedule to reconcile undiscounted future minimum lease payments	Future minimum lease payments under non-cancelable leases as of July 30, 2023 were as follows (in thousands): (amounts in thousands) 2024 $ 7,896 2025 30,562 2026 28,231 2027 25,946 2028 23,692 Thereafter 82,929 Total undiscounted future minimum lease payments 199,256 Less: imputed interest (33,753) Total present value of lease obligations 165,503 Less: current operating lease liability (16,072) Operating lease liability- long term $ 149,431
Schedule of supplemental cash flow information and non-cash activity related to operating leases	Supplemental information related to our operating leases is as follows (in thousands): Twenty-six weeks ended (amounts in thousands) July 30, 2023 July 31, 2022 Operating cash flow information: Amounts paid on operating lease liabilities $ 14,208 $ 8,501 Non-cash activities: Right-of-use assets obtained in exchange for lease obligations $ 24,676 $ 20,702 Weighted average remaining lease term - operating leases 7.6 years 7.3 years Weighted average discount rate - operating leases 4.55 % 4.01 %

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	6 Months Ended
	Jul. 30, 2023
Stockholders' Equity Note [Abstract]
Schedule of unvested restricted stock	A summary of the status of our unvested restricted stock units as of July 30, 2023 and July 31, 2022, and changes during the twenty-six weeks ended, is presented below: Number of shares Weighted average grant date fair value Unvested at January 30, 2022 533,333 $ 28.41 Granted 278,087 45.58 Forfeited (21,243) 23.12 Vested (102,649) 34.86 Unvested at July 31, 2022 687,528 $ 34.87

Segment Information (Tables)

Segment Information (Tables)	6 Months Ended
	Jul. 30, 2023
Segment Reporting [Abstract]
Schedule of operating segments	The Company’s sales by product which are considered one segment are as follows: Thirteen weeks ended Twenty-six weeks ended July 30, July 31, July 30, July 31, (amounts in thousands) Sactionals $ 140,507 $ 136,513 $ 268,413 $ 251,515 Sacs 11,663 9,908 22,399 21,835 Other 2,359 2,113 4,910 4,564 $ 154,529 $ 148,534 $ 295,722 $ 277,914

Basis of Presentation and Sum_3

Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) $ in Millions	3 Months Ended	6 Months Ended
	Jul. 30, 2023 USD ($) showroom	Jul. 30, 2023 USD ($) showroom	Jul. 31, 2022 USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of stores | showroom	223	223
Contributions plan, percentage		100%
Employer contribution plan, cost | $	$ 0.3	$ 0.8	$ 0.7

Revenue Recognition (Details)

Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022	Jan. 29, 2023
Disaggregation of Revenue [Line Items]
Cost of merchandise sold	$ 62,139	$ 69,435	$ 132,757	$ 132,841
Returns allowance	3,100		3,100		$ 4,500
Accrued expenses	700		700		1,000
Customer deposit liabilities	(12,300)		(12,300)		(6,800)
Recognized related to customer deposits			(6,800)	(13,300)
Inventory exchanged for media credits	2,800	9,500	6,900	$ 12,100
Unused media credits	30,200		$ 30,200		$ 25,200
Foreign Countries | Revenue Benchmark | Geographic Concentration Risk
Disaggregation of Revenue [Line Items]
Concentration of sales (less than)			0.01%	0.01%
Shipping and Handling
Disaggregation of Revenue [Line Items]
Cost of merchandise sold	$ 25,600	$ 35,300	$ 63,500	$ 70,300

Revenue Recognition - Schedule

Revenue Recognition - Schedule of sales disaggregated by channel (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022
Disaggregation of Revenue [Line Items]
Sales	$ 154,529	$ 148,534	$ 295,722	$ 277,914
Showrooms
Disaggregation of Revenue [Line Items]
Sales	98,226	92,426	181,800	173,680
Internet
Disaggregation of Revenue [Line Items]
Sales	41,425	35,534	81,650	66,789
Other
Disaggregation of Revenue [Line Items]
Sales	$ 14,878	$ 20,574	$ 32,272	$ 37,445

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022
Income Tax Disclosure [Abstract]
Federal and state income tax (benefit) expense	$ 7	$ (2,274)	$ 1,257	$ (2,947)
Effective income tax rate, percent	28%	1%	20.90%	27.80%
Penalties and interest expense	$ 0	$ 0	$ 0	$ 0

Basic and Diluted Net (Loss) _2

Basic and Diluted Net (Loss) Income Per Common Share (Details) - shares	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022
Restricted Stock Units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive (in shares)	1,060,705	687,528	1,060,705	687,528
Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive (in shares)	495,366	281,750	495,366	495,366
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive (in shares)		495,366		281,750

Leases - Schedule of components

Leases - Schedule of components of lease expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022
Leases [Abstract]
Operating lease expense	$ 7,391	$ 5,808	$ 14,395	$ 11,142
Variable lease expense	2,486	3,991	4,542	6,205
Short term lease expense	407	180	647	359
Total lease expense	$ 10,284	$ 9,979	$ 19,584	$ 17,706

Leases - Schedule of lease term

Leases - Schedule of lease terms and rates (Details)	Jul. 30, 2023	Jul. 31, 2022
Leases [Abstract]
Operating leases, weighted average remaining lease term (in years)	7 years 7 months 6 days	7 years 3 months 18 days
Operating leases, weighted average discount rate	4.55%	4.01%

Leases - Narrative (Details)

Leases - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022	Jul. 30, 2023	Jul. 31, 2022
Leases [Abstract]
Impairment charges	$ 0	$ 0	$ 0	$ 0

Leases - Schedule of future min

Leases - Schedule of future minimum payments for operating leases (Details) - USD ($) $ in Thousands	Jul. 30, 2023	Jan. 29, 2023
Leases [Abstract]
2024	$ 7,896
2025	30,562
2026	28,231
2027	25,946
2028	23,692
Thereafter	82,929
Total undiscounted future minimum lease payments	199,256
Less: imputed interest	(33,753)
Total present value of lease obligations	165,503
Less: current operating lease liability	(16,072)	$ (13,075)
Operating Lease Liability, long-term	$ 149,431	$ 133,491

Leases - Supplemental Cash Flow

Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022
Leases [Abstract]
Amounts paid on operating lease liabilities	$ 14,208	$ 8,501
Right-of-use assets obtained in exchange for lease obligations	$ 24,676	$ 20,702

Financing Arrangements (Details

Financing Arrangements (Details) - USD ($)	Mar. 25, 2022	Jul. 30, 2023	Jan. 29, 2023	Mar. 24, 2022
Line of Credit Facility [Abstract]
Borrowings amount	$ 40,000,000	$ 36,000,000	$ 36,000,000	$ 25,000,000
Eligible credit card receivables percentage	90%
Eligible wholesale receivables percentage	85%
Net recovery percentage	85%
Increase the net recovery percentage	90%
Minimum undrawn availability	10%
Line of credit		$ 0	$ 0

Stockholders' Equity - Narrativ

Stockholders' Equity - Narrative (Details) $ / shares in Units, $ in Millions				1 Months Ended		3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 26, 2023 shares	Jun. 05, 2021 trading_day $ / shares	Jun. 29, 2018 shares	Mar. 31, 2023 shares	Jun. 30, 2019 trading_day $ / shares shares	Jul. 30, 2023 USD ($) $ / shares shares	Jul. 31, 2022 USD ($) $ / shares shares	Jul. 30, 2023 USD ($) $ / shares shares	Jul. 31, 2022 USD ($) $ / shares shares	Jan. 30, 2022 USD ($) shares
Class of Stock [Line Items]
Warrants issued (in shares)			281,750
Warrants issued, term			5 years
Cashless warrant exercised (in shares)							0
Exercise of warrants (in shares)	74,592
Increase in common stock reserved for future issuance (in shares)								225,000
Non statutory stock options granted (in shares)					495,366
Stock option price exercise (in dollars per share) | $ / shares					$ 38.10
Stock options are subject to vesting percentage					100%
Consecutive trading days | trading_day		40			40
Stock price (in dollars per share) | $ / shares		$ 75			$ 75
Stock option modified (in shares)										495,366
Additional compensation | $										$ 0.9
Modification and remaining expense was recognized | $										$ 0.3
Number of options, outstanding (in shares)						495,366	495,366	495,366	495,366
Weighted average exercise price, outstanding (in dollars per share) | $ / shares						$ 38.10	$ 38.10	$ 38.10	$ 38.10
Weighted average remaining contractual life, outstanding (in years)								10 months 6 days	1 year 10 months 6 days
Average intrinsic value, outstanding (in dollars per share) | $ / shares						$ 0	$ 1.89	$ 0	$ 1.89
Equity based compensation expense | $						$ 1.3	$ 1	$ 2	$ 2.2
Total unrecognized equity based compensation cost related to unvested stock option and restricted unit awards | $						$ 11		$ 11
Weighted average period								3 years 10 months 24 days
Restricted stock units
Class of Stock [Line Items]
Restricted stock award grant (in shares)				235,000
2017 Equity Incentive Plan
Class of Stock [Line Items]
Granted term								10 years
Common stock reserved issuance (in shares)						2,879,889		2,879,889
Warrant
Class of Stock [Line Items]
Number of warrants, warrants outstanding (in shares)	281,750					0	281,750	0	281,750
Average exercise price, warrants outstanding (in dollars per share) | $ / shares							$ 19.20		$ 19.20
Weighted average remaining contractual life (in years), warrants outstanding, beginning balance									10 months 28 days

Stockholders' Equity - Schedule

Stockholders' Equity - Schedule of unvested restricted stock (Details) - Restricted stock units - $ / shares	6 Months Ended
	Jul. 30, 2023	Jul. 31, 2022
Number of shares
Number of shares, unvested, beginning balance (in shares)	640,256	533,333
Number of shares, granted (in shares)	815,340	278,087
Number of shares, forfeited (in shares)	(25,874)	(21,243)
Number of shares, vested (in shares)	(369,017)	(102,649)
Number of shares, unvested, ending balance (in shares)	1,060,705	687,528
Weighted average grant date fair value
Weighted average grant date fair value, unvested, beginning balance (in dollars per share)	$ 34.50	$ 28.41
Weighted average grant date fair value, granted (in dollars per share)	26.76	45.58
Weighted average grant date fair value, forfeited (in dollars per share)	35.32	23.12
Weighted average grant date fair value, vested (in dollars per share)	24.37	34.86
Weighted average grant date fair value, unvested, ending balance (in dollars per share)	$ 32.05	$ 34.87

Segment Information (Details)

Segment Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 30, 2023 USD ($)	Jul. 31, 2022 USD ($)	Jul. 30, 2023 USD ($) segment	Jul. 31, 2022 USD ($)
Segment Reporting Information [Line Items]
Number of reporting segments | segment			1
Net sales	$ 154,529	$ 148,534	$ 295,722	$ 277,914
Sactionals
Segment Reporting Information [Line Items]
Net sales	140,507	136,513	268,413	251,515
Sacs
Segment Reporting Information [Line Items]
Net sales	11,663	9,908	22,399	21,835
Other
Segment Reporting Information [Line Items]
Net sales	$ 2,359	$ 2,113	$ 4,910	$ 4,564