Vera Bradley, Inc. (Nasdaq: VRA) on Sept. 15, 2026, reported second-quarter fiscal 2027 results, marking its second consecutive quarter of overall growth. Consolidated net revenues from continuing operations totaled $71.6 million, up 1.1% from $70.9 million in the prior-year quarter. The Fort Wayne, Indiana, company's fiscal year ends Jan. 30, 2027.
The results follow a stretch of revenue declines for the women's accessories brand. The company's Direct segment, which includes its full-line and outlet stores, websites and direct-to-consumer marketplaces, has now posted five straight quarters of sequential improvement. Its Indirect segment, which sells through specialty and department stores, continued to contract as the company scaled back liquidation and wholesale volume, a trajectory distinct from the Direct segment's trend.
#Vera Bradley's Direct Segment Drives Growth as Indirect Sales Decline
Direct segment revenues totaled $65.4 million in the quarter, an 8.0% increase from $60.5 million a year earlier. Comparable sales rose 9.2%, with all channels positive, which the company attributed to improved e-commerce conversion and higher average transaction value.
"Our direct segment delivered revenue growth of 8%, our fifth consecutive quarter of sequential improvement, with comparable sales up 9.2% for the quarter, our second consecutive quarter of positive comparable results," Ian Bickley, Chairman and Chief Executive Officer of Vera Bradley, said in the earnings release.
Indirect segment revenues totaled $6.3 million, a 39.4% decrease from $10.3 million in the prior-year quarter. The company attributed the decline to strategic shifts in its marketplace strategy and a reduction in liquidation sales, partly offset by improvement in specialty and department store channels.
#Vera Bradley Strengthens Balance Sheet With Lower Inventory, Higher Cash
Consolidated gross profit totaled $42.8 million, or 59.8% of net revenues, compared with $35.5 million, or 50.1%, a year earlier. The company said $7.7 million in tariff refunds tied to prior-period customs entries drove most of the increase; excluding the refunds, gross margin still improved more than 0.4 percentage points.
Operating income from continuing operations totaled $4.2 million, or 5.8% of net revenues, a 1,230 basis-point improvement from an operating loss of $4.6 million, or 6.5% of net revenues, in the prior-year quarter. On a non-GAAP basis, operating income was $4.3 million, or 5.9% of net revenues, versus a non-GAAP operating loss of $0.6 million a year earlier.
Net income from continuing operations totaled $4.5 million, or $0.15 per diluted share, compared with a net loss of $4.7 million, or $0.17 per diluted share, in the prior-year quarter. On a non-GAAP basis, net income from continuing operations was $3.3 million, or $0.11 per diluted share.
Cash and cash equivalents reached $34.2 million as of Aug. 1, 2026, more than double the $15.2 million on hand a year earlier and up $15.7 million from the Jan. 31, 2026, fiscal year-end. The company had no borrowings on its asset-based lending facility during the quarter, compared with $10 million in long-term debt outstanding a year earlier.
Inventory ended the quarter at $69.3 million, a 28.4% reduction from $96.7 million in the prior-year quarter. Vera Bradley attributed the decrease to improved assortment planning and buy management, along with a $5.3 million inventory reserve tied to its Project Restoration initiative.
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#Vera Bradley Reiterates Fiscal 2027 Sales and Margin Guidance
Vera Bradley reiterated its guidance for fiscal 2027 sales of $255 million to $270 million. The company said the range reflects the impact of rebuilding its wholesale business under new leadership, while placing less emphasis on liquidation channels.
Based on its year-to-date performance, the company said it continues to expect non-GAAP operating loss improvement of 50% or better compared with the prior year's operating loss of $21.7 million.
The company's forward-looking statements are subject to risks including shifts in consumer demand and spending, competitive pressures, and tariffs or other cost increases affecting its manufacturing, according to the earnings release.
Bickley said work remains as Vera Bradley pursues long-term sustainable growth, profitability and cash flow generation, citing progress across the company's five transformation pillars.