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What changed in HAVERTY FURNITURE COMPANIES INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of HAVERTY FURNITURE COMPANIES INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+192 added−155 removedSource: 10-K (2026-02-26) vs 10-K (2025-03-06)

Top changes in HAVERTY FURNITURE COMPANIES INC's 2025 10-K

192 paragraphs added · 155 removed · 130 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe believe our significant investments in the digital channel have improved search capabilities, site functionality, and product presentation, which are each important in driving traffic, increasing conversion, and sales growth. We have added more conversion events, traffic, and conversion variables in Adobe Analytics which has allowed more refined and sophisticated A/B testing and improved insight into customer behavior.
Biggest changeCurrently available for eight sectional collections, the configurator tool will be expanded to additional collections over time. We believe our significant investments have improved search capabilities, site functionality, product presentation, and improving insights into customer behavior, which are each important in driving traffic, increasing conversion, and growing sales.
Distribution We believe our distribution and delivery system is one of the best in the retail furniture industry and provides us with a significant competitive advantage. Our distribution and delivery system uses a combination of three distribution centers (“DCs”) and four home delivery centers (“HDCs”). The DCs receive both domestic product and containers of imported merchandise.
Distribution and Delivery We believe our distribution and delivery system is one of the best in the retail furniture industry and provides us with a significant competitive advantage. Our system uses a combination of three distribution centers (“DCs”) and four home delivery centers (“HDCs”). The DCs receive both domestic product and containers of imported merchandise.
These consumers research and shop online and in-store, often engaging friends or family members in the purchasing process. They are discerning buyers, desiring furnishings that fit their style, but never sacrifice quality or value. Our marketing, merchandising, stores, online presence, and customer service are targeted to attract and meet the needs of our distinctive customers.
These consumers research and shop online and in-store, often engaging friends or family members in the purchasing process. They are discerning buyers, desiring furnishings that fit their style, but never sacrifice quality or value. Our marketing, merchandising, stores, online presence, and customer service are targeted to attract and meet the needs of our customers.
Retention and Development Our compensation programs are designed to attract, retain, and motivate team members to achieve superior results. Havertys’ total compensation for teammates comprises a variety of components, including competitive pay consistent with positions, skill levels, experience, and knowledge.
Retention and Development Our compensation programs are designed to attract, retain, and motivate team members to achieve superior results. Havertys’ total compensation for team members comprises a variety of components, including competitive pay consistent with positions, skill levels, experience, and knowledge.
In addition, we have registered and maintain numerous internet domain names including “havertys.com.” Collectively, the logos, trademarks, service marks and domain names that we hold are of material importance to us. Available Information Our internet website address is www.havertys.com. Information about us is within this 2024 Form 10-K, and on our Investor Relations website at www.ir.havertys.com.
In addition, we have registered and maintain numerous internet domain names including “havertys.com.” Collectively, the logos, trademarks, service marks and domain names that we hold are of material importance to us. Available Information Our internet website address is www.havertys.com. Information about us is within this 2025 Form 10-K, and on our Investor Relations website at www.ir.havertys.com.
This website contains additional information about us, including our corporate governance principles and practices and financial and other information. We are not including this or any other information on our website as a part of, nor incorporating it by reference into, this 2024 Form 10-K or any of our other filings with the Securities and Exchange Commission ("SEC").
This website contains additional information about us, including our corporate governance principles and practices and financial and other information. We are not including this or any other information on our website as a part of, nor incorporating it by reference into, this 2025 Form 10-K or any of our other filings with the Securities and Exchange Commission ("SEC").
Customers may make their purchase in the store or opt to return home and finalize their decisions, place their orders online and schedule delivery. We limit internet sales of our furniture to within our delivery network, and internet sales of a selection of our accessories to within the continental United States.
Customers may make their purchase in the store or opt to return home and finalize their decisions, place their orders online and schedule delivery. We limit internet sales of our furniture to within our delivery network, and internet sales of a selection of our accessories to within the continental United States, excluding California.
In 2024, Havertys team members consumed approximately 117,000 hours of learning. We also offer the opportunity for team members to pursue degree programs, professional certificates, and individual courses in strategic fields of study through our tuition reimbursement program. Competition The retail sale of home furnishings is a highly fragmented and competitive business.
In 2025, Havertys team members consumed approximately 105,000 hours of learning. We also offer the opportunity for team members to pursue degree programs, professional certificates, and individual courses in strategic fields of study through our tuition reimbursement program. Competition The retail sale of home furnishings is a highly fragmented and competitive business.
We experience increased shopping activity on weekends and during traditional extended holiday periods. 5 Table of Contents Trademarks and Domain Names We have registered our various logos, trademarks, and service marks. We believe that our trademark position is adequately protected in all markets in which we do business.
We experience increased shopping activity on weekends and during traditional extended holiday periods. Trademarks and Domain Names We have registered our various logos, trademarks, and service marks. We believe that our trademark position is adequately protected in all markets in which we do business.
These changes focused on: • more visually appealing signage, • tagging strategies, • new fixtures to centrally locate custom fabrics, • optimized floor presentation of our mattress selection, and • equipment for the design center to personalize our customer's shopping experience.
These changes focused on: • more visually appealing signage, • tagging strategies, • new fixtures to centrally locate custom fabrics, • optimized floor presentation of our mattress selection, and • equipment for the design center to personalize our customer's shopping experience. The signage, tagging and fabric fixtures are largely complete.
We are committed to differing perspectives across all levels of our workforce to improve our business and reflect the vibrant and thriving diversity of the communities in which we live and work. We periodically conduct an Employee Engagement Survey (the “Survey”) as a means of measuring employee engagement and satisfaction and offering employees the chance to feel heard.
We are committed to fostering differing perspectives across all levels of our workforce to improve our business and reflect the vibrant and thriving diversity of the communities in which we live and work. We periodically conduct an Employee Engagement Survey as a means of measuring engagement and satisfaction and offering our team members the chance to feel heard.
The fees we pay to the third parties are included in our selling, general, and administrative expenses (“SG&A”) as a selling expense. Suppliers and Supply Chain We buy our merchandise from numerous foreign and domestic manufacturers and importers, the largest ten of which accounted for approximate ly 41.3% of our product purchases during 2024.
The fees we pay to the third parties are included in our selling, general, and administrative expenses (“SG&A”) as a selling expense. Suppliers and Supply Chain We buy our merchandise from numerous foreign and domestic manufacturers and importers, the largest ten of which accounted for approximate ly 42.9% of our product purchases during 2025.
We also offer competitive benefits, including access to healthcare plans, financial and physical wellness programs, paid time off, parental leave and retirement benefits. We are committed to supporting our teammates’ continuous development of professional, technical and leadership skills through corporate training programs, access to digital learning resources and through partnerships with local technical learning institutions.
We also offer competitive benefits, including access to healthcare plans, financial and physical wellness programs, paid time off, parental leave and retirement benefits. We are committed to supporting our team members’ continuous development of professional, technical and leadership skills through corporate training programs, access to digital learning resources and through partners hips with local technical learning institutions.
Stores As of December 31, 2024, we operated 129 stores serving 92 cities in 17 states with approximately 4.5 million retail square feet. Our stores range in size from 15,000 to 60,000 selling square feet, with the average being approximately 35,000 square feet.
Stores As of December 31, 2025, we operated 129 stores serving over 90 cities in 17 states with approximately 4.5 million retail square feet. Our stores range in size from 15,000 to 60,000 selling square feet, with the average being approximately 35,000 square feet.
The following outlines the change in our selling square footage for each of the three years ended December 31 (square footage in thousands): 2024 2023 2022 Store Activity: # of Stores Square Footage # of Stores Square Footage # of Stores Square Footage Opened 6 171 4 110 3 97 Closed 1 20 2 86 2 88 Year end balances 129 4,538 124 4,387 122 4,363 The following table summarizes our store activity in 2024 and current plans for 2025.
The following outlines the change in our selling square footage for each of the three years ended December 31 (square footage in thousands): 2025 2024 2023 Store Activity: # of Stores Square Footage # of Stores Square Footage # of Stores Square Footage Opened 3 94 6 171 4 110 Closed 3 89 1 20 2 86 Year end balances 129 4,543 129 4,538 124 4,387 The following table summarizes our store activity in 2025 and current plans for 2026.
We continually analyze opportunities for potential relocations within markets and close retail locations that are underperforming or no longer consistent with our brand positioning. For leased locations we generally continue to operate the store until our lease expires.
Newly constructed sites are typically leased, though there are occasional opportunities to own the store. We continually analyze opportunities for potential relocations within markets and close retail locations that are underperforming or no longer consistent with our brand positioning. For leased locations we generally continue to operate the store until our lease expires.
We believe Havertys is uniquely positioned in the marketplace, with a targeted mix of merchandise that appeals to customers who are somewhat more affluent than those of promotional price-oriented furniture stores. Our online presence provides most elements of a seamless, interconnected approach that many of our competitors do not have or cannot replicate.
We believe Havertys is uniquely positioned in the marketplace, with a curated merchandise assortment that appeals to customers who are generally more affluent than those served by promotional, price-oriented furniture stores. Our online presence provides most elements of a seamless, interconnected approach that many of our competitors do not have.
Interior details are also important for a pleasant and inviting shopping experience. We are very intentional in having open shopping spaces and our disciplined merchandise display ensures uniformity of presentations in-store, online and in our advertising. During 2024 we developed a program to improve the in-store experience.
We are very intentional in having open shopping spaces and our disciplined merchandise display ensures uniformity of presentations in-store, online and in our advertising. In 2024 we developed a program to improve the in-store experience.
We have a seasoned, commissioned-based sales team serving our customers. Their product knowledge is important in helping customers evaluate Havertys' merchandise compared to our competitors. We also offer a free in-home design service to customers who want an in-depth personalized experience.
We have a seasoned, commissioned-based sales team serving our customers. Their product knowledge is important in helping customers evaluate Havertys' merchandise compared to our competitors. We also offer a free design service, including in-home consultations, to customers who want an in-depth personalized experience. We aim to have at least one design consultant available in each store.
We strive to have our stores reflect the distinctive style and comfort consumers expect to find when purchasing their home furnishings. The store’s location and curb appeal are important to the middle to upper-middle income consumer that we target, and attractive facades complement the quality and style of our merchandise.
We strive for our stores to reflect the distinctive style and comfort consumers expect when purchasing their home furnishings. The store’s location and curb appeal are important to the middle to upper-middle income consumer that we target, and attractive facades complement the quality and style of our merchandise. Interior details are also important for a pleasant and inviting shopping experience.
We consider our custom order capabilities, free in-home design service, the tailoring of merchandise on a local market basis, and the ability to make prompt delivery of orders through maintenance of inventory to be significant competitive advantages. Seasonality Our business is affected by traditional retail seasonality, advertising and promotion programs, and general economic trends.
We consider our internal management of customer facing operations, custom order capabilities, free design service, tailoring of merchandise by local market, and the ability to make prompt delivery of orders through maintenance of inventory to be significant competitive advantages. 5 Table of Contents Seasonality Our business is affected by traditional retail seasonality, advertising and promotion programs, and general economic trends.
Time between purchase and delivery averages 3 to 5 days for in-stock items and 5 to 7 weeks for special order items. Human Capital Resources As of December 31, 2024, Havertys’ total workforce was 2,334: 1,480 in our retail store operations, 645 in our warehouse and delivery points, 168 in our corporate operations, and 41 in our customer-service call centers.
Time between purchase and delivery averages 3 to 5 days for in-stock items and 5 to 7 weeks for special order items. 4 Table of Contents Human Capital Resources As of December 31, 2025, Havertys’ total workforce was 2,392: 1,512 in our retail store operations, 671 in our warehouse and delivery points, 167 in our corporate operations, and 42 in our customer-service call centers.
Sales financed by the third-party providers are not Havertys’ receivables; accordingly, we do not have any credit risk or servicing responsibility for these accounts, and there is no credit or collection recourse to Havertys. Slightly less than one-third of our sales are third-party-financed.
As an added convenience to our customers, we offer financing by third-party finance companies. Sales financed by the third-party providers are not Havertys’ receivables; accordingly, we do not have any credit risk or servicing responsibility for these accounts, and there is no credit or collection recourse to Havertys. Approximately one-third of our sales are third-party-financed.
Havertys has grown to 129 stores in 17 states i n the Southern and Midwest regions of the U.S. All of our retail locations are operated using the Havertys name, and we do not franchise our stores.
The Company's common stock ("HVT") and Class A common stock ("HVT-A") are traded on the New York Stock Exchange (the "NYSE"). Havertys has grown to 129 stores in 17 states i n the Southern and Midwest regions of the U.S. All of our retail locations are operated using the Havertys name, and we do not franchise our stores.
Product reviews written by our customers are also available, which many consumers find helpful in the decision-making process. The next stop in the purchase journey for most consumers is a visit to a store to touch, sit, and see merchandise in person. Our sales consultants use online tools to further engage our customers while they are in the store.
The next stop in the purchase journey for most consumers is a visit to a store to touch, sit, and see merchandise in person. Our sales consultants use online tools to further engage our customers while they are in the store.
Approximately 20.8% of our case goods sales and 5.9% of o ur upholstery sales in 2024 were generated by our direct imports. 3 Table of Contents The longer lead times required for deliveries from overseas factories and the production of merchandise exclusively for Havertys makes it imperative for us to have both warehousing capabilities and end-to-end supply chain visibility.
In 2025, direct case goods represented approximately 7.3% of total purchases, and direct upholstery purchases represented 1.5%. 3 Table of Contents The longer lead times required for deliveries from overseas factories and the production of merchandise exclusively for Havertys makes it imperative for us to have both warehousing capabilities and end-to-end supply chain visibility.
The average sales ticket for a customer who has a designer visit their home is generally twice that of our average in-store sales ticket. Approximately 33.6% of our written sales in 2024 resulted from consultations with our in-home designers.
The average sales ticket for a customer who utilizes our free design services is generally twice that of our average sales ticket. Approximately 33.5% of our written sales in 2025 resulted from consultations with our in-home designers.
These locations are primarily in the form of former "big box" retail sites in the 25,000 to 35,000 square feet size range that we lease with an initial term of years and options to renew. Newly constructed sites are typically leased, though there are occasional opportunities to own the store.
We select new locations using demographic and market characteristics and sales potential. These locations are primarily in the form of former "big box" retail sites in the 25,000 to 35,000 square feet size range that we lease with an initial term of years and options to renew.
None of our team members is a party to a union contract. 4 Table of Contents Health and Safety We care about our teammates, customers, and the communities we serve. We believe a hazard-free environment is a critical enabler for the success of our business.
None of our team members is a party to a union contract. Health and Safety We are committed to the well-being of our team members, customers, and the communities we serve. We believe maintaining a safe, hazard-free environment is essential to the success of our business.
The HDCs provide service to markets within an additional 250 miles. We use third parties to handle over-the-road delivery of product from the DCs to the HDCs and market areas.
The HDCs provide service to markets within an additional 250 miles. We use third parties to handle over-the-road delivery of product from the DCs to the HDCs and market areas. We use Havertys team members for executing home delivery, an important function serving as the last contact with our customers in the purchase process.
We have a strong safety program that focuses on implementing policies and training programs to ensure our team members can leave their job and return home safely every day. Culture and Engagement Integrity and teamwork are two of our core values.
Our strong safety program emphasizes policies and training programs to ensure our team members can return home safely every day. Culture and Engagement Integrity and teamwork are two of our core values, and drive our approach to everyday operations and interactions with our customers, suppliers, and team members.
Our brand recognition is very high in the markets we serve, and consumer surveys indicate Havertys is associated with a high level of quality, fashion, value, and service. Customers Havertys customers are typically well-educated women in middle to upper-middle income households. They generally own homes in the suburbs, and their diverse personalities are reflected in their unique sense of style.
Our brand has strong recognition in the markets we serve, and consumer surveys consistently associate Havertys with high quality, style, value, and service. Customers Havertys core customers are typically women in middle to upper-middle income households. They generally own homes in the suburbs, and their unique personalities are expressed through style-conscious choices that reflect an awareness of current trends.
Our total sales completed online for 2024 were approximately 3.0% of our total 2024 business. 2 Table of Contents From the initial inspirational point in the purchase journey to providing design assistance, we continue to invest in our digital channels. We have made investments to improve the presentation and ease of navigation for our customers and information on products.
Our total sales completed online for 2025 were approximately 3.2% of our total 2025 business. 2 Table of Contents We continue to invest in our digital channels to support our customer's purchase journey from initial inspiration through design assistance. We have invested in our website to enhance presentation, expand product information, and provide customers with easier, more intuitive navigation.
Most of our wood products, or “case goods,” are imported from Asia. Upholstered items are largely produced domestically, with the exception of our leather products which are primarily imported from Asia or Mexico. We purchase our furniture merchandise produced in Asia through sourcing companies and also buy direct from manufacturers.
Most of our wood products, or “case goods,” are imported from Asia. The majority of our upholstered products are sourced from domestic vendors. We purchase our furniture merchandise produced in Asia through sourcing companies and also buy direct from manufacturers. We have dedicated quality control specialists on-site during production to ensure the items meet our specifications.
We have dedicated quality control specialists on-site during production to ensure the items meet our specifications. Our direct import team works with industry designers and manufacturers in some of the best factories throughout Asia.
Our direct import team works with industry designers and manufacturers in some of the best factories throughout Asia. In response to the evolving tariff environment, we have reduced our direct imports.
We carry nationally well-known mattress product lines such as Tempur-Pedic®, Serta®, Stearns and Foster®, Beautyrest®, and Sealy®. Our customers use varying methods to purchase or finance their sales. As an added convenience to our customers, we offer financing by third-party finance companies.
However, we ensure that our assortment includes merchandise that is "good", "better", and "best" to compete with retailers across varying price points. We carry nationally well-known mattress product lines such as Tempur-Pedic®, Serta®, Stearns and Foster®, Beautyrest®, and Sealy®. Our customers use varying methods to purchase or finance their sales.
We use real-time information to closely follow our import orders from the manufacturing plant through each stage of transit and using this data can more accurately set customer delivery dates prior to receipt of product.
Our supply chain team supports the procurement process to ensure inventory levels remain within an appropriate range and reduce the number of written sales awaiting product delivery. We use real-time information to monitor our import orders from the manufacturing plant through each stage of transit, which allows us to more accurately set customer delivery dates prior to receipt of product.
Location Quarter Actual or Planned Category Pine Bluff, AR Q-1-24 Closure Southaven, MS Q-1-24 Open Destin, FL Q-2-24 Open Miami, FL Q-3-24 Open Tampa, FL Q-4-24 Open Greenwood, IN Q-4-24 Open Houston, TX Q-4-24 Open Houston, TX Q-1-25 Open Daytona, FL Q-2-25 Relocation Houston, TX Q-3-25 Open Houston, TX Q-2-26 Open Online Presence We consider our website an extension of our brick-and-mortar locations and not a separate segment of our business.
Louis, MO Q-1-26 Open Alexandria, LA Q-1-26 Closure Nashville, TN Q-2-26 Open Houston, TX Q-4-26 Open Houston, TX Q-4-26 Open Pittsburgh, PA Q-4-26 Open Online Presence We consider our website an extension of our brick-and-mortar locations and not a separate segment of our business.
We expect the program to be implemented over three years and will begin introducing these changes to our larger stores in 2025. 1 Table of Contents Our goal, subject to market conditions and identifying suitable sites, is to open an average of net five new stores per year. We select new locations using demographic and market characteristics and sales potential.
We expect to complete the mattress floor presentation and design center portions of the program over the next two years. 1 Table of Contents Real Estate Our goal, subject to market conditions and identifying suitable sites, is to open an average of net five new stores per year, concentrating growth within our current distribution footprint.
Most customers will use the internet for inspiration and as a start to their shopping process to view products and prices. Our website features a variety of helpful tools including a design center with a 3-D room planner, upholstery customization, and inspired accessories.
Our website features a variety of helpful tools including a design center with a 3-D room planner, upholstery customization, and inspired accessories. Product reviews written by our customers are also available, which many consumers find helpful in the decision-making process.
These drive our approach in our everyday operations with our customers, suppliers and teammates and we believe that the best results happen when we work together. At Havertys, we see strength in America’s many faces, cultures, and colors. Each person offers a unique point of view and presents a fresh perspective integral to supporting innovation.
We believe that collaboration drives the best outcomes and value the many backgrounds, cultures, and perspectives represented in our workforce. Each person offers a unique point of view and presents a fresh perspective which supports innovation.
We use Havertys team members for executing home delivery, and have branded this service “Top Drawer Delivery,” an important function serving as the last contact with our customers in the purchase process. Operating standards in our warehouse and delivery functions provide measurements for determining staffing needs and increasing productivity.
Operating standards in our warehouse and delivery functions provide measurements for determining staffing needs and increasing productivity.
We have also enhanced online product landing pages by providing more information, including related products within and beyond its larger collection. We believe our focus on improving search capabilities, website functionality, category presentation, product content, and delivery timeframe can lead to increased traffic, conversion rates and sales.
We have also enhanced online product landing pages by providing more information, including related products within and beyond its larger collection. Merchandise and Revenues We develop our merchandise selection with the diverse taste of our typical “on-trend” customer in mind.
Removed
During 2024 we opened the first of our stores in Houston, TX, the largest market we did not serve within our existing distribution system. We currently have no plans to add stores outside our distribution footprint.
Added
Location Quarter Actual or Planned Category Houston, TX Q-1-25 Open Daytona, FL Q-2-25 Relocation Atlanta, GA Q-2-25 Closure Waco, TX Q-2-25 Closure Houston, TX Q-4-25 Open St.
Removed
We do not view the interconnected shopping experience as a specific transaction; rather, we believe it encompasses an entire journey spanning across inspiration and know-how, purchase and fulfillment, and post-purchase care and support. Merchandise and Revenues We develop our merchandise selection with the diverse taste of our typical “on-trend” customer in mind.
Added
Further, v iew the interconnected shopping experience not as a specific transaction; but as a comprehensive customer journey encompassing inspiration and product research, purchase and fulfillment, and post-purchase care and support. Most customers begin their shopping process online, using the internet for inspiration and to view products and prices.
Removed
Our merchandising team provides input to the automated procurement process in an effort to maintain overall inventory levels within an appropriate range and reduce the number of written sales awaiting product delivery.
Added
In 2025, we introduced a sectional configurator tool, which allows customers to build a fully custom sectional in-store or online by selecting modular pieces and visualizing the configuration in real-time with three-dimensional views. The finished custom sectional integrates seamlessly into our point-of-sale system when the customer is ready to purchase.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

31 edited+44 added−12 removed50 unchanged
Biggest changeMoreover, a security breach involving the misappropriation, loss or other unauthorized disclosure of sensitive or confidential information could give rise to unwanted media attention, materially damage our customer relationships and reputation, and result in litigation or fines, fees, or potential liabilities, which may not be covered by our insurance policies, each of which could have a material adverse effect on our business, results of operations and financial condition.
Biggest changeIn addition, the costs to eliminate or alleviate network security problems, bugs, viruses, worms, malicious software programs and security vulnerabilities could be significant, and our efforts to address these problems may not be successful and could result in potential theft, loss, destruction or corruption of information we store electronically, as well as unexpected interruptions, delays or cessation of service, any of which could cause harm to our business operations. 12 Table of Contents Moreover, a security breach involving the misappropriation, loss or other unauthorized disclosure of sensitive or confidential information could give rise to unwanted media attention, materially damage our customer relationships and reputation, and result in litigation or fines, fees, or potential liabilities, which may not be covered by our insurance policies, each of which could have a material adverse effect on our business, results of operations and financial condition.
Factors influencing consumer spending include: • general economic conditions, • consumer disposable income, • fuel prices, • inflation, • recession and fears of recession, • unemployment, • inclement weather, • availability of consumer credit, • consumer debt levels, • conditions in the housing market, • interest rates, • sales tax rates and rate increases, • sustained periods of inflation, • civil disturbances and terrorist activities, • foreign currency exchange rate fluctuations, • consumer confidence in future economic and political conditions, • natural disasters, and • consumer perceptions of personal well‑being and security, including health epidemics or pandemics.
Factors influencing consumer spending include: • general economic conditions, • consumer disposable income, • fuel prices, 6 Table of Contents • inflation, • recession and fears of recession, • unemployment, • inclement weather, • availability of consumer credit, • consumer debt levels, • conditions in the housing market, • interest rates, • sales tax rates and rate increases, • sustained periods of inflation, • civil disturbances and terrorist activities, • foreign currency exchange rate fluctuations, • consumer confidence in future economic and political conditions, • natural disasters, and • consumer perceptions of personal well‑being and security, including health epidemics or pandemics.
Our and our vendors’ utilization of these shipping services is subject to risks that are outside of our control, including increases in fuel prices and labor costs, employee strikes, labor shortages, union organizing activity, delays in shipping (including congestion at domestic and foreign ports), delays in 9 Table of Contents unloading cargo from ships, availability of adequate trucking or railway providers, adverse weather, natural disasters, possible acts of terrorism and outbreaks of disease.
Our and our vendors’ utilization of these shipping services is subject to risks that are outside of our control, including increases in fuel prices and labor costs, employee strikes, labor shortages, union organizing activity, delays in shipping (including congestion at domestic and foreign ports), delays in unloading cargo from ships, availability of adequate trucking or railway providers, adverse weather, natural disasters, possible acts of terrorism and outbreaks of disease.
We must also be able to attract, motivate and retain the teammates who staff our distribution centers, customer service centers, and deliver product to our customers, and professionals to implement our technology and other strategic initiatives.
We must also be able to attract, motivate and retain the employees who staff our distribution centers, customer service centers, and deliver product to our customers, and professionals to implement our technology and other strategic initiatives.
We are regularly the target of attempted cyber and 10 Table of Contents other security threats and must continuously monitor and develop our information technology networks and infrastructure to prevent, detect, address and mitigate the risk of unauthorized access, misuse, computer viruses and other events that could have a security impact.
We are regularly the target of attempted cyber and other security threats and must continuously monitor and develop our information technology networks and infrastructure to prevent, detect, address and mitigate the risk of unauthorized access, misuse, computer viruses and other events that could have a security impact.
If such an interruption were to occur, our ability to deliver our products in a timely manner would likely be impacted. We rely extensively on information technology systems to process transactions, summarize results, and manage our business. Disruptions in our information technology systems could adversely affect our business and operating results.
If such an interruption were to occur, our ability to deliver our products in a timely manner would likely be impacted. Risks Related to Technology and Data Security We rely extensively on information technology systems to process transactions, summarize results, and manage our business. Disruptions in our information technology systems could adversely affect our business and operating results.
Based on product costs, approximately 58 % o f our total furniture purchases in 2024 were for goods that were not produced domestically. Additionally, some of the products we purchase from U.S.-based vendors are sourced, at least in part, from foreign suppliers.
Based on product costs, approximately 63% o f our total furniture purchases in 2025 were for goods that were not produced domestically. Additionally, some of the products we purchase from U.S.-based vendors are sourced, at least in part, from foreign suppliers.
Our business depends on consumer demand for our products and, consequently, is sensitive to a number of factors that influence general consumer spending on discretionary items in particular.
Our business depends on consumer demand for our products and, consequently, is sensitive to a number of factors that influence general consumer spending on discretionary items, including home furnishings in particular.
Risks Related to Our Business We face significant competition from national, regional and local retailers of home furnishings. The retail market for home furnishings is highly fragmented and intensely competitive. We currently compete against a diverse group of retailers, including internet-only retailers, regional or independent specialty stores, dedicated franchises of furniture manufacturers and national department stores.
We face significant competition from national, regional and local retailers of home furnishings. The retail market for home furnishings is highly fragmented and intensely competitive. We currently compete against a diverse group of retailers, including internet-only retailers, regional or independent specialty stores, dedicated franchises of furniture manufacturers and national retailers and department stores.
These systems are subject to damage or interruption from power outages, computer and telecommunications failures, viruses, phishing attempts, cyber‑attacks, malware and ransomware attacks, security breaches, severe weather, natural disasters, and errors by employees.
These systems are subject to damage or interruption from power outages, computer and telecommunications failures, viruses, phishing attempts, 11 Table of Contents cyber‑attacks, malware and ransomware attacks, security breaches, severe weather, natural disasters, and errors by employees.
Excessive employee turnover will result in higher employee costs associated with finding, hiring and training new store employees. Furthermore, labor shortages and competition may make it more difficult for us to adequately staff our retail stores and distribution operations and may result in increased labor expenses to us.
Turnover in the retail industry is generally high. Excessive employee turnover will result in higher employee costs associated with finding, hiring and training new store employees. Furthermore, labor shortages and competition may make it more difficult for us to adequately staff our retail stores and distribution operations and may result in increased labor expenses to us.
Inability to maintain and enhance our brand may materially adversely impact our business. Maintaining and enhancing our brand is critical to our ability to retain and expand our base of customers and may require us to make substantial investments. Our advertising campaigns utilize digital, television, and social media to maintain and enhance our existing brand equity.
Maintaining and enhancing our brand is critical to our ability to retain and expand our base of customers and may require us to make substantial investments. Our advertising campaigns utilize digital, television, and social media to maintain and enhance our existing brand equity.
A failure to maintain appropriate organizational capacity and capability to support our strategic initiatives or to build adequate bench strength with key skillsets 11 Table of Contents required for seamless succession of leadership, could jeopardize our ability to meet our business performance expectations and growth targets.
A failure to maintain appropriate organizational capacity and capability to support our strategic initiatives or to build adequate bench strength with key skill sets required for seamless succession of leadership, could jeopardize our ability to meet our business performance expectations and growth targets.
There also remains a risk that one or more of our foreign manufacturers will not adhere to applicable legal requirements or our compliance standards such as fair labor standards, the prohibition on child labor and other product safety or manufacturing safety standards.
Resulting penalties or enforcement actions could delay future imports or otherwise negatively impact our business. There also remains a risk that one or more of our foreign manufacturers will not adhere to applicable legal requirements or our compliance standards such as fair labor standards, the prohibition on child labor and other product safety or manufacturing safety standards.
We may be unable to attract, train, engage and retain key teammates. Our long-term success and ability to implement our strategic and business planning goals depends on our ability to attract, motivate and retain a sufficient number of store and other employees who understand and appreciate our corporate culture and customers. Turnover in the retail industry is generally high.
Risks Related to Human Capital We may be unable to attract, train, engage and retain key employees. Our long-term success and ability to implement our strategic and business planning goals depends on our ability to attract, motivate and retain a sufficient number of store and other employees who understand and appreciate our corporate culture and customers.
We are dependent upon t he ability of our third-party producers to meet our requirements; any failures by these producers, or the unavailability of suitable suppliers at reasonable prices or limitations on our ability to source from third-party producers may negatively impact our ability to deliver quality merchandise to our customers on a timely basis or result in higher costs or reduced net sales.
As exchange rates between the U.S. dollar and certain other currencies become favorable, the likelihood of price increases from our vendors increases. 9 Table of Contents We are dependent upon t he ability of our third-party producers to meet our requirements; any failures by these producers, or the unavailability of suitable suppliers at reasonable prices or limitations on our ability to source from third-party producers may negatively impact our ability to deliver quality merchandise to our customers on a timely basis or result in higher costs or reduced net sales.
All of our vendors must comply with applicable product safety laws and regulations, and we are dependent on them to ensure that the products we buy comply with all safety standards as well applicable quality standards.
Our vendors might fail in meeting our quality control standards or reacting to changes to the legislative or regulatory framework regarding product safety. All of our vendors must comply with applicable product safety laws and regulations, and we are dependent on them to ensure that the products we buy comply with all safety standards as well as applicable quality standards.
In addition, failure by our independent manufacturers to adhere to ethical labor or other laws or business practices, and the potential litigation, negative publicity and political pressure relating to any of these events, could disrupt our operations or harm our reputation. 8 Table of Contents Our vendors might fail in meeting our quality control standards or reacting to changes to the legislative or regulatory framework regarding product safety.
In addition, failure by our independent manufacturers to adhere to ethical labor or other laws or business practices, and the potential litigation, negative publicity and political pressure relating to any of these events, could disrupt our operations or harm our reputation.
If our critical information technology systems or back-up systems were damaged or ceased to function properly, we might have to make a significant investment to repair or replace them. Successful cyber-attacks and the failure to maintain adequate cyber-security systems and procedures could materially harm our business.
If our critical information technology systems or back-up systems were damaged or ceased to function properly, we might have to make a significant investment to repair or replace them.
Our products must appeal to our target consumers whose preferences, tastes and trends cannot be predicted with certainty and are subject to change. We continuously monitor changes in home design trends through attendance at international industry events and fashion shows, internal marketing research, and regular communication with our retailers and design professionals who provide valuable input on consumer tendencies.
We continuously monitor changes in home design trends through attendance at international industry events and fashion shows, internal marketing research, and regular communication with our retailers and design professionals who provide valuable input on consumer tendencies. However, as with all retailers, our business is susceptible to changes in consumer tastes and trends.
However, as with all retailers, our business is susceptible to changes in consumer tastes and trends. Our success depends upon our ability to anticipate and respond in a timely manner to fashion trends relating to home furnishings. If we fail to successfully identify and respond to these changes, our sales may decline.
Our success depends upon our ability to anticipate and respond in a timely manner to fashion trends relating to home furnishings. If we fail to successfully identify and respond to these changes, our sales may decline. Omni-channel retailing continues to rapidly evolve.
Competition from any of these sources could cause us to lose market share, revenues and customers; increase expenditures; or reduce prices, any of which could have a material adverse effect on our results of operations. 6 Table of Contents If we fail to successfully anticipate or respond to changes in consumer preferences in a timely manner, our sales may decline.
Competition from any of these sources could cause us to lose market share, revenues and customers; increase expenditures; or reduce prices, any of which could have a material adverse effect on our results of operations.
Cyber threats are rapidly evolving, and those threats and the means for obtaining access to information in digital and other storage media are becoming increasingly sophisticated.
Successful cyber-attacks and the failure to maintain adequate cyber-security systems and procedures could materially harm our business. Cyber threats are rapidly evolving, and those threats and the means for obtaining access to information in digital and other storage media are becoming increasingly sophisticated.
Pending or unforeseen litigation and the potential for adverse publicity associated with litigation could have a material adverse effect on us. We are involved from time to time in various legal proceedings arising in the ordinary course of our business, including commercial, consumer safety, product liability, employment and intellectual property claims.
We are involved from time to time in various legal proceedings arising in the ordinary course of our business, including commercial, consumer safety, product liability, employment and intellectual property claims. We currently do not expect the outcome of any pending matters to have a material adverse effect on our consolidated results of operations, financial position or cash flows.
If we are unable to attract, develop, retain and incentivize sufficiently experienced and capable management personnel, our business and financial results may suffer. General Risks An overall decline in the health of the economy and consumer spending may affect consumer purchases of discretionary items, which could reduce demand for our products and materially harm our sales, profitability and financial condition.
Risks Related to Our Business An overall decline in the health of the economy and consumer spending may affect consumer purchases of discretionary items, which could reduce demand for our products and materially harm our sales, profitability and financial condition. Historically, the home furnishings industry has been subject to cyclical variations in the general economy.
If any of these initiatives are not successful, or require extensive investment, our growth may be limited, and we may be unable to achieve or maintain expected levels of growth and profitability. Furthermore, our ability to expand our retail footprint is dependent on our ability to identify, secure and develop new retail locations, which involves factors outside of our control.
If any of these initiatives are not successful, or require extensive investment beyond our expectations, our growth may be limited, and we may be unable to achieve or maintain expected levels of growth and profitability.
Some of the products we purchase are also subject to tariffs and other import measures. If tariffs are imposed on additional products or the tariff rates are increased, our vendors may increase their prices.
The recent enactment of these tariffs, along with the unpredictability of the applicable tariff rates, poses a risk to our business operations and may materially increase our costs and reduce our margins. If additional tariffs are imposed on the products we import or the tariff rates are increased, our vendors may increase their prices.
We cannot provide assurance that our marketing, advertising, and other efforts to promote and maintain awareness of our brand will be successful and we may incur substantial costs in such efforts. Furthermore, our brand and reputation could be harmed by negative media, including social media, attention, negative online reviews, cybersecurity incidents, product liability or safety concerns or other matters.
We cannot provide assurance that our marketing, advertising, and other efforts to promote and maintain awareness of our brand, grow our business, attract new clients and retain existing clients will be successful and we may incur substantial costs in such efforts.
In addition, there is a risk that compliance lapses by our foreign manufacturers could occur which could lead to investigations by U.S. government agencies responsible for international trade compliance. Resulting penalties or enforcement actions could delay future imports or otherwise negatively impact our business.
Increased levels of out-of-stock merchandise and loss of confidence by customers in our ability to deliver goods as promised could negatively affect sales. 10 Table of Contents In addition, there is a risk that compliance lapses by our foreign manufacturers could occur which could lead to investigations by U.S. government agencies responsible for international trade compliance.
If our marketing, advertising, and other efforts are unsuccessful or our brand or reputation is damaged, our business, operating results and financial condition could be materially adversely affected. 7 Table of Contents We import a substantial portion of our merchandise from foreign sources, which exposes us to political and economic risks inherent in global sourcing.
If a store location becomes unsuitable, we will generally be unable to cancel the long-term lease associated with such store. 8 Table of Contents Risks Related to Merchandising and Supply Chain Operations We import a substantial portion of our merchandise from foreign sources, which exposes us to political and economic risks inherent in global sourcing.
Disruptions to our supply chain could result in late product arrivals. Increased levels of out-of-stock merchandise and loss of confidence by customers in our ability to deliver goods as promised could negatively affect sales.
Disruptions to our supply chain could result in late product arrivals.
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Rapidly evolving technologies are altering the manner in which retailers communicate and transact with customers, led by internet-based and multichannel retailers that have made significant investments in recent years, including with pricing technology and shipping capabilities.
Added
Risks Related to Our Retail Operations and Marketing If we fail to successfully anticipate or respond to changes in our target consumer's product and shopping channel preferences in a timely manner, our sales may decline. Our products must appeal to our target consumers whose preferences, tastes and trends cannot be predicted with certainty and are subject to change.
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Additionally, our business relies on the strategic placement of our store locations. Because our business predominately relies on in-store sales, if our stores are located in areas that do not attract sufficient customer traffic or do not align with the shopping preferences of our customer bases, our sales may be adversely affected.
Added
Our success depends, in part, on our ability to anticipate and implement innovations in client experience and logistics in order to appeal to customers who increasingly rely on multiple channels to meet their shopping needs.
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All our purchases are denominated in U.S. dollars. As exchange rates between the U.S. dollar and certain other currencies become unfavorable, the likelihood of price increases from our vendors increases.
Added
If for any reason we are unable to continue to implement our omni-channel initiatives or provide a convenient and consistent experience for our clients across all channels that deliver the products they want, when and where they want them, our financial performance and brand image could be adversely affected. 7 Table of Contents Inability to maintain and enhance our brand may materially adversely impact our business.
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In addition, the costs to eliminate or alleviate network security problems, bugs, viruses, worms, malicious software programs and security vulnerabilities could be significant, and our efforts to address these problems may not be successful and could result in potential theft, loss, destruction or corruption of information we store electronically, as well as unexpected interruptions, delays or cessation of service, any of which could cause harm to our business operations.
Added
Furthermore, our brand and reputation could be harmed by negative media, including social media, attention, negative online reviews, cybersecurity incidents, product liability or safety concerns or other matters. If our marketing, advertising, and other efforts are unsuccessful or our brand or reputation is damaged, our business, operating results and financial condition could be adversely affected.
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Historically, because customers consider home furnishings to be postponable purchases, the home furnishings industry has been subject to cyclical variations in the general economy and to uncertainty regarding future economic prospects. The rise of oil and gasoline prices could affect our profitability. A significant increase in oil and gasoline prices could adversely affect our profitability.
Added
Furthermore, our ability to expand our retail footprint is dependent on our ability to identify, secure and develop new retail locations, which involves factors outside of our control. Our ability to attract clients to our stores depends heavily on successfully locating our stores in suitable locations.
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In addition, governmental efforts to combat climate change through reduction of greenhouse gases may result in higher fuel costs through taxation or other means.
Added
We believe our stores and our customer’s store experience are key for generating and increasing revenue. Historically we have favored locations that we believe are consistent with our target clients’ demographics and shopping preferences and we plan to open new stores in high traffic locations.
Removed
Our distribution system, which utilizes three DCs and multiple home delivery centers is very transportation dependent and includes the use of third-party providers to rea ch the 22 states and the District of Columbia that we serve from our stores across 17 Southern and Midwestern states. Merchandise is delivered to customers' homes by Havertys delivery teams.
Added
Revenues at our stores are derived, in part, from the volume of foot traffic in these locations.
Removed
If transportation costs exceed amounts we are able to effectively pass on to the consumer, either by higher prices and/or higher delivery charges, then our profitability will suffer. 12 Table of Contents ESG risks could adversely affect our reputation and shareholder, employee, customer and third-party relationships and may negatively affect our stock price.
Added
Store locations may become unsuitable due to, and our revenue volume and client traffic generally may be harmed by, among other things: • economic downturns in a particular area; • competition from nearby retailers selling similar products; • changing client demographics in a particular market; • changing preferences of clients in a particular market; • the closing or decline in popularity of other businesses located near our store; • reduced client foot traffic outside a store location; and • store impairments due to acts of God, pandemic, terrorism, protest or periods of civil unrest.
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Our business faces increasing public scrutiny related to environmental, social, and governance ("ESG") activities.
Added
Some of the products we purchase are also subject to tariffs and other import measures. During 2025, the current U.S. presidential administration announced its intention and, in some cases, took actions to increase tariffs at various rates, including on certain products imported from many countries and individualized higher tariffs on certain other countries.
Removed
We risk damage to our brand and reputation if we fail to act responsibly in a number of areas, such as environmental stewardship, including with respect to climate change, human capital management, support for our local communities, corporate governance and transparency, or fail to consider ESG factors in our business operations.
Added
These tariffs were imposed under various regulations, including the International Emergency Economic Powers Act (“IEEPA”). In response, certain countries announced reciprocal tariffs or other similar actions. These tariffs have since been followed by announcements of limited exemptions and temporary pauses in some cases. In addition, the United States Supreme Court recently invalidated the tariffs the administration imposed under IEEPA.
Removed
Additionally, some investors and shareholder advocates are placing ever increasing emphasis on how corporations address ESG issues in their business strategy when making investment decisions and when developing their investment theses and proxy recommendations. We may incur meaningful costs with respect to our ESG efforts and if such efforts are negatively perceived, our reputation and stock price may suffer.
Added
Following the Supreme Court’s decision, the administration has announced new tariffs under different authority and the intention to announce additional tariffs in the future. We are subject to risks relating to increased tariffs on U.S. imports and other changes affecting imports and finished goods manufactured in foreign countries.
Removed
We currently do not expect the outcome of any pending matters to have a material adverse effect on our consolidated results of operations, financial position or cash flows.
Added
There continues to be significant uncertainty about the future relationship between the U.S. and other countries regarding such trade policies, treaties and tariffs. As such, we can make no assurances about the eventual impact on our consolidated operating results and business.
Added
The introduction of any additional tariffs by the U.S. and reciprocal tariffs by other countries is expected to result in incremental costs of our products, which we may be unable to pass on to our customers. In addition, all our purchases are denominated in U.S. dollars.
Added
We have and plan to continue to partner with third parties that utilize artificial intelligence (“AI”) tools and to invest in AI technologies to enhance our customers’ shopping experience and our employees’ work experience and to improve efficiencies of our supply chain, operations, management functions and talent recruitment and development.
Added
These are evolving technologies and there are inherent operational and legal complexities associated with implementation of these technologies within our business.
Added
When integrating and introducing AI technologies into our platforms, processes and systems, we may be exposed to new or expanded liabilities and risks due to evolving governmental regulations, litigation, data privacy risks and compliance issues in a disparate and at times conflicting regulatory environment, all of which could negatively affect our financial performance and business reputation.
Added
If we are unable to attract, develop, retain and incentivize sufficiently experienced and capable management personnel, our business and financial results may suffer. General Risks Our operations present risks which may not be fully covered by insurance. We carry insurance that we believe is appropriate and customary in our industry.
Added
However, some losses and liabilities associated with our operations may not be covered by our insurance policies. In addition, there can be no assurance that we will be able to obtain similar insurance coverage on favorable terms (or at all) in the future.
Added
Significant uninsured losses and liabilities could have an adverse effect on our financial condition and results of operations. Furthermore, our insurance is subject to deductibles. We are self-insured for our health benefits and maintain per employee stop loss coverage; however, we retain the insurable risk at an aggregate level.
Added
Therefore unforeseen or catastrophic losses in excess of our insured limits could have an adverse effect on the Company’s financial condition and operating results. 13 Table of Contents We are subject to governmental regulations and may be subject to enforcement if we are not in compliance with applicable regulation, and changes in laws could make conducting our business more expensive or otherwise change the way we do business.
Added
We are subject to a broad range of federal, state and local laws and regulations in connection with our core business, including labor and employment, customs, privacy and cybersecurity, health and safety, real estate, environmental and zoning and occupancy laws, and other laws and regulations that otherwise govern our business.
Added
Our products and their manufacturing, labeling, marketing and sale are also subject to various aspects of the Federal Trade Commission Act, state consumer protection laws and state warning and labeling laws. In addition, various jurisdictions may seek to adopt similar or additional product labeling or warning requirements.
Added
As a retail business, changes in laws related to employee benefits and treatment of employees, including laws related to limitations on employee hours, supervisory status, leaves of absence, mandated health benefits or overtime pay, could negatively impact our business increasing compensation and benefits costs for overtime and medical expenses.
Added
Changes to U.S. health care laws, or potential global and domestic greenhouse gas emission requirements and other environmental legislation and regulations, could result in increased direct compliance costs for us (or may cause our vendors to raise the prices they charge us in order to maintain profitable operations because of increased compliance costs), increased transportation costs or reduced availability of raw materials.
Added
Failure by us, our manufacturers, or our vendors to comply with applicable laws and regulations or to obtain and maintain necessary permits, licenses, and registrations relating to our operations could subject us to administrative and civil penalties, including significant fines, civil liability, criminal liability or sanctions, or other enforcement actions.
Added
Any of these actions could result in a material effect on our operating results, business and financial condition, including increased operating costs. Our business involves receiving, processing, storing, using and sharing data, some of which contains personal information.
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We are subject to complex and rapidly evolving laws and contractual obligations addressing data protection, and companies are under increased regulatory scrutiny with respect to privacy and data security. The interpretation and application of existing laws regarding this subject are continuing to evolve and many states are considering new regulations in this area.
Added
Applicable U.S. privacy laws or new state or federal laws may limit our ability to collect and use data, require us to modify our data processing practices or result in the possibility of fines, litigation or orders which may have an adverse effect on our business and results of operations.
Added
We cannot yet fully determine the impact that such future privacy requirements may have on our business or operations.
Added
The burdens imposed by these and other laws and regulations that may be enacted, or new interpretations of existing laws and regulations, may also require us to incur substantial costs to reach compliance, change the manner in which we use data, and adversely affect the profitability of our private label credit card program.
Added
In addition, to the extent we expand our operations as a result of engaging in new business initiatives or product lines, or expanding into new markets, we may become subject to new regulations and regulatory regimes.
Added
In addition to increased regulatory compliance, if the regulations applicable to our business operations were to change, it could make conducting our business more expensive or otherwise change the way we do business.
Added
We may need to continually reassess our compliance procedures, personnel levels and regulatory framework in order to keep pace with our business initiatives, and there can be no assurance that we will be successful in doing so.
Added
Failure by us, our manufacturers, or our vendors to comply with applicable laws and regulations or to obtain and maintain necessary permits, licenses, and registrations relating to our operations could subject us to administrative and civil penalties, including significant fines, civil liability, criminal liability or sanctions, or other enforcement actions.
Added
Any of these actions could result in a material effect on our operating results, business and financial condition, including increased operating costs. 14 Table of Contents Failure to protect our intellectual property could materially adversely affect us. We believe that our copyrights, trademarks, service marks, trade secrets, and all of our other intellectual property are important to our success.
Added
We rely on trademark, copyright and trade secret laws, and confidentiality and restricted use agreements, to protect our intellectual property and may seek licenses to intellectual property of others. Some of our intellectual property is not covered by any patent, trademark, or copyright or any applications for the same.
Added
In addition, we cannot provide assurance that agreements designed to protect our intellectual property will not be breached, that we will have adequate remedies for any such breach, or that the efforts we take to protect our proprietary rights will be sufficient or effective.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe SVP of Information Technology also presents at least annually to the Board an overview of our cybersecurity threat risk management and strategy processes covering topics such as data security posture, results of third-party assessments, our incident response plan, and cybersecurity threat risks or incidents and developments, as well as the steps management has taken to respond to such risks. 14 Table of Contents
Biggest changePeriodically, the CIO also presents to the Board an overview of our cybersecurity threat risk management and strategy processes covering topics such as data security posture, results of third-party assessments, our incident response plan, and cybersecurity threat risks or incidents and developments, as well as the steps management has taken to respond to such risks.
For more information on how cybersecurity risk could materially affect our business strategy, results of operations, or financial condition, please refer to Item 1A Risk Factors. Cybersecurity Governance The board of directors, as a whole, has oversight responsibility for our strategic and operational risks.
For more information on how cybersecurity risk could materially affect our business strategy, results of operations, or financial condition, please refer to Item 1A Risk Factors. 16 Table of Contents Cybersecurity Governance The Board of Directors, as a whole, has oversight responsibility for our strategic and operational risks.
Our 13 Table of Contents cybersecurity teams assist in responding to incidents depending on severity levels and seek to improve our cybersecurity incident management plan through periodic tabletops or simulations. • Training: We provide security awareness training to help our employees understand their information protection and cybersecurity responsibilities.
Our cybersecurity teams assist in responding to incidents depending on severity levels and seek to improve our cybersecurity incident management plan through periodic tabletops or simulations. • Training: We provide security awareness training to help our employees understand their information protection and cybersecurity responsibilities.
Management is responsible for day-to-day assessment and management of cybersecurity risks. Our cybersecurity risk management and strategy processes are led by our SVP of Information Technology and Assistant Vice President (AVP) of IT Infrastructure and Security.
Management is responsible for day-to-day assessment and management of cybersecurity risks. Our cybersecurity risk management and strategy processes are led by our CIO and Assistant Vice President (AVP) of IT Infrastructure and Security.
Our Senior Vice President (SVP) of Information Technology and other internal members of our technology team provide regular reports to the audit committee regarding the evolving cybersecurity landscape, including emerging risks, as well as our processes, programs, and initiatives for managing these risks. The audit committee, in turn, periodically reports on its review with the board of directors.
Our Chief Information Officer (CIO) and other internal members of our technology team provide regular reports to the Audit Committee regarding the evolving cybersecurity landscape, including emerging risks, as well as our processes, programs, and initiatives for managing these risks. The Audit Committee, in turn, periodically reports on its review with the Board of Directors.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table sets forth the number of stores we operated at December 31, 2024 by state: State Number of Stores State Number of Stores Florida 33 Louisiana 3 Texas 22 Ohio 3 Georgia 15 Arkansas 2 North Carolina 10 Kentucky 2 Virginia 10 Indiana 2 South Carolina 7 Missouri 2 Alabama 6 Kansas 1 Tennessee 6 Mississippi 1 Maryland 4 The 37 retail locations which we owned at December 31, 2024 had a net book value for land and buildings of $58.9 million.
Biggest changeThe following table sets forth the number of stores we operated at December 31, 2025 by state: State Number of Stores State Number of Stores Florida 33 Louisiana 3 Texas 23 Ohio 3 Georgia 14 Arkansas 2 North Carolina 10 Kentucky 2 Virginia 10 Indiana 2 South Carolina 7 Missouri 2 Alabama 6 Kansas 1 Tennessee 6 Mississippi 1 Maryland 4 Distribution Facilities All of our distribution facilities at December 31, 2025 were leased except for the Florida and Virginia properties.
Our regional distribution facilities are in the following locations: Location Approximate Square Footage Braselton, Georgia 808,000 Coppell, Texas 409,000 Lakeland, Florida 335,000 Colonial Heights, Virginia 129,000 Fairfield, Ohio 72,000 Theodore, Alabama 42,000 Memphis, Tennessee 30,000 Corporate Facilities We lease approximately 48,000 square feet on two floors of a suburban mid-rise office building located at 780 Johnson Ferry Road, Suite 800, Atlanta, Georgia.
Our regional distribution facilities are in the following locations: Location Approximate Square Footage Braselton, Georgia 808,000 Coppell, Texas 409,000 Lakeland, Florida 335,000 Colonial Heights, Virginia 129,000 Fairfield, Ohio 72,000 Theodore, Alabama 42,000 Memphis, Tennessee 30,000 17 Table of Contents Corporate Facilities We lease approximately 48,000 square feet on two floors of a suburban mid-rise office building located at 780 Johnson Ferry Road, Suite 800, Atlanta, Georgia.
We believe that our facilities are suitable and adequate for present purposes, and that the productive capacity in such facilities is substantially being utilized. For additional information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this report under Item 7 of Part II. 15 Table of Contents
We believe that our facilities are suitable and adequate for present purposes, and that the productive capacity in such facilities is substantially being utilized. For additional information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this report under Item 7 of Part II.
ITEM 2. PROPERTIES Stores Our retail store space at December 31, 2024 totaled approximately 4.5 million square feet for 129 stores .
ITEM 2. PROPERTIES Stores Our retail store space at December 31, 2025 totaled approximately 4.5 million square feet for 129 stores .
Removed
The remaining 92 locations are leased by us with various termination dates through 2037 plus renewal options. Distribution Facilities All of our distribution facilities at December 31, 2024 were leased except for the Florida and Virginia properties.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeHare 58 Executive Vice President, Chief Financial Officer, and Corporate Secretary 2024 Executive Vice President and Chief Financial Officer, 2017- November 16, 2024 1 - Clarence H. Smith was elected Executive Chairman and Steven G. Burdette was elected President and Chief Executive Officer effective January 1, 2025. 2 - Clarence H.
Biggest changeHare 59 Executive Vice President, Chief Financial Officer 2017 Executive Vice President and Chief Financial Officer Corporate Secretary, November 2024 - May 2025 1 - Clarence H. Smith is first cousins with director Rawson Haverty, Jr., and is the brother of director E. Kendrick Smith. 19 Table of Contents PART II
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 16 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS Our executive officers are elected or appointed annually by the Board of Directors for terms of one year or until their successors are elected and qualified, subject to removal by the Board at any time.
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 18 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS Our executive officers are elected or appointed annually by the Board of Directors for terms of one year or until their successors are elected and qualified, subject to removal by the Board at any time.
Name, age and office (as of March 1, 2025) and year elected to office Principal occupation during last five years other than office of the Company currently held Steven G. Burdette 1 63 President and Chief Executive Officer 2025 President, 2021 Executive Vice President, Operations 2017-March 1, 2021 Director 2025 Clarence H.
Name, age and office (as of March 1, 2026) and year elected to office Principal occupation during last five years other than office of the Company currently held Steven G. Burdette 64 President and Chief Executive Officer 2025 President, 2021 Executive Vice President, Operations 2017-March 1, 2021 Director 2025 Clarence H.
Smith 1,2 74 Executive Chairman of the Board 2025 Chairman of the Board, 2012-2024 Chief Executive Officer, 2002-2024 President, 2002-March 1, 2021 Director 1989 John L. Gill 61 Executive Vice President, Merchandising 2019 Has held this position for the last five years Richard B.
Smith 1 75 Executive Chairman of the Board 2025 Chairman of the Board, 2012-2024 Chief Executive Officer, 2002-2024 President, 2002-March 1, 2021 Director 1989 John L. Gill 62 Executive Vice President, Merchandising 2019 Has held this position for the last five years Richard B.
Removed
Smith and one of our directors, Rawson Haverty, Jr., are first cousins. 17 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table presents information with respect to our repurchase of Havertys’ common stock during the fourth quarter of 2024: (a) Total Number of Shares Purchased (b) Average Price Paid Per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs October 1 - October 31 — $ — — $ 13,113,000 November 1 - November 30 200,000 $ 23.23 200,000 $ 8,467,000 December 1 - December 31 14,500 $ 23.84 14,500 $ 8,121,000 Total 214,500 214,500
Biggest changeThe following table presents information with respect to our repurchase of Havertys’ common stock during the fourth quarter of 2025: (a) Total Number of Shares Purchased (b) Average Price Paid Per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs October 1 - October 31 — $ — — $ 6,121,000 November 1 - November 30 122,741 $ 22.63 122,741 $ 3,343,000 December 1 - December 31 — $ — — $ 3,343,000 Total 122,741 122,741 On February 20, 2026 the Board of Directors approved $15.0 million of additional repurchase authorization for our stock repurchase program.
Stock Performance Graph The following graph compares the performance of Havertys’ Common Stock and Class A Common Stock against the cumulative return of the NYSE/AMEX/Nasdaq Home Furnishings & Equipment Stores Index (SIC Codes 5700 – 5799) and the S&P SmallCap 600 Index for the period of five years commencing December 31, 2019 and ending December 31, 2024.
Stock Performance Graph The following graph compares the performance of Havertys’ Common Stock and Class A Common Stock against the cumulative return of the NYSE/AMEX/Nasdaq Home Furnishings & Equipment Stores Index (SIC Codes 5700 – 5799) and the S&P SmallCap 600 Index for the period of five years commencing December 31, 2020 and ending December 31, 2025.
The graph assumes an initial investment of $100 on January 1, 2019 and reinvestment of dividends. NOTE: Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980-2025. Index Data: Copyright Standard and Poor’s, Inc. Used with permission.
The graph assumes an initial investment of $100 on January 1, 2020 and reinvestment of dividends. NOTE: Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980-2026. Index Data: Copyright Standard and Poor’s, Inc. Used with permission.
For more information, see Note 5, “Credit Arrangement,” and Note 9, “Stockholders’ Equity,” in the Notes to Consolidated Financial Statements.
For more information, see Note 6, “Credit Arrangement,” and Note 10, “Stockholders’ Equity,” in the Notes to Consolidated Financial Statements.
All rights reserved. 2019 2020 2021 2022 2023 2024 HVT $ 100.00 $ 152.82 $ 184.33 $ 193.20 $ 246.24 $ 161.59 HVT-A $ 100.00 $ 158.99 $ 180.08 $ 194.22 $ 239.67 $ 154.70 S&P SmallCap 600 Index $ 100.00 $ 111.29 $ 141.13 $ 118.41 $ 137.42 $ 149.37 SIC Codes 5700-5799 $ 100.00 $ 136.86 $ 184.92 $ 120.34 $ 140.99 $ 200.79 18 Table of Contents Stockholders Based on the number of individual participants represented by security position listings, there are approximately 8,900 holders of our common stock and 200 holders of our Class A common stock as of February 14, 2025.
All rights reserved. 2020 2021 2022 2023 2024 2025 HVT $ 100.00 $ 120.62 $ 126.43 $ 161.13 $ 105.74 $ 117.55 HVT-A $ 100.00 $ 113.26 $ 122.16 $ 150.74 $ 98.50 $ 108.04 S&P SmallCap 600 Index $ 100.00 $ 126.82 $ 106.40 $ 123.48 $ 134.22 $ 142.30 SIC Codes 5700-5799 $ 100.00 $ 134.94 $ 88.55 $ 104.24 $ 149.20 $ 119.77 20 Table of Contents Stockholders Based on the number of individual participants represented by security position listings, there are approximately 11,400 holders of our common stock and 200 holders of our Class A common stock as of February 19, 2026.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeStatement of Earnings Data Year Ended December 31, (Dollars in thousands, except per share data) 2024 2023 2022 2021 2020 (1) Net sales $ 722,899 $ 862,133 $ 1,047,215 $ 1,012,799 $ 748,252 Gross profit 439,078 523,092 604,225 574,625 418,994 Percent of net sales 60.7 % 60.7 % 57.7 % 56.7 % 56.0 % Selling, general and administrative expenses 419,221 455,812 486,298 456,267 377,288 Percent of net sales 58.0 % 52.9 % 46.4 % 45.1 % 50.4 % Income before income taxes (2) 26,153 72,711 119,501 118,535 76,731 Percent of net sales 3.6 % 8.4 % 11.4 % 11.7 % 10.3 % Net income (2) 19,956 56,319 89,358 90,803 59,148 Percent of net sales 2.8 % 6.5 % 8.5 % 9.0 % 7.9 % Share Data Diluted earnings per Common share (2) $ 1.19 $ 3.36 $ 5.24 $ 4.90 $ 3.12 Cash dividends – per share: Common Stock (3) $ 1.26 $ 2.18 $ 2.09 $ 2.97 $ 2.77 Class A Common Stock (3) $ 1.18 $ 2.05 $ 1.96 $ 2.79 $ 2.62 Diluted weighted average common shares outstanding 16,707 16,774 17,038 18,543 18,932 Balance Sheet Data Total assets $ 648,747 $ 654,133 $ 649,050 $ 686,290 $ 680,372 Inventories 83,419 93,956 118,333 112,031 89,908 Net property and equipment 182,622 171,588 137,475 126,099 108,366 Right-of-use lease assets 194,411 202,306 207,390 222,356 228,749 Lease liabilities 218,379 217,754 221,287 230,352 233,666 Customer deposits 40,733 35,837 47,969 98,897 86,183 Total debt (4) — — — — — Stockholders’ Equity 307,561 308,366 289,399 255,970 252,967 Statement of Cash Flows Data Net cash provided by operating activities $ 58,909 $ 97,203 $ 51,015 $ 97,242 $ 130,191 Depreciation and amortization 21,611 18,603 16,926 16,304 18,207 Capital expenditures 32,092 53,115 28,411 34,090 10,927 Dividends paid 20,468 35,240 33,948 52,446 50,521 Share repurchases 4,991 6,895 29,998 41,809 19,708 Other Supplemental Data and Metrics Number of stores 129 124 122 121 120 Retail square footage at year-end (in 000s) 4,539 4,387 4,363 4,354 4,352 Sales per WAVG retail square foot $ 164 $ 197 $ 241 $ 232 $ 173 Average ticket (5) $ 3,371 $ 3,278 $ 3,171 $ 2,865 $ 2,482 Net sales (decrease) increase (%) (16.1 %) (17.7 %) 3.4 % 35.4 % (6.7) % Comparable store sales (decrease) increase (%) (16.7 %) (18.4 %) 3.4 % 17.9 % 5.0 % Employees 2,334 2,574 2,831 2,845 2,766 (1) Stores were closed and delivery operations were paused for approximately six weeks due to COVID-19.
Biggest changeStatement of Earnings Data Year Ended December 31, (Dollars in thousands, except per share data) 2025 2024 2023 2022 2021 Net sales $ 758,995 $ 722,899 $ 862,133 $ 1,047,215 $ 1,012,799 Gross profit 460,497 439,078 523,092 604,225 574,625 Percent of net sales 60.7 % 60.7 % 60.7 % 57.7 % 56.7 % Selling, general and administrative expenses 439,327 419,221 455,812 486,298 456,267 Percent of net sales 57.9 % 58.0 % 52.9 % 46.4 % 45.1 % Income before income taxes 26,833 26,153 72,711 119,501 118,535 Percent of net sales 3.5 % 3.6 % 8.4 % 11.4 % 11.7 % Net income 19,730 19,956 56,319 89,358 90,803 Percent of net sales 2.6 % 2.8 % 6.5 % 8.5 % 9.0 % Share Data Diluted earnings per Common share $ 1.19 $ 1.19 $ 3.36 $ 5.24 $ 4.90 Cash dividends – per share: Common Stock (1) $ 1.29 $ 1.26 $ 2.18 $ 2.09 $ 2.97 Class A Common Stock (1) $ 1.21 $ 1.18 $ 2.05 $ 1.96 $ 2.79 Diluted weighted average common shares outstanding 16,592 16,707 16,774 17,038 18,543 Balance Sheet Data Total assets $ 649,052 $ 648,747 $ 654,133 $ 649,050 $ 686,290 Inventories 96,155 83,419 93,956 118,333 112,031 Net property and equipment 177,207 182,622 171,588 137,475 126,099 Right-of-use lease assets 190,586 194,411 202,306 207,390 222,356 Lease liabilities 216,417 218,379 217,754 221,287 230,352 Customer deposits 35,504 40,733 35,837 47,969 98,897 Total debt (2) — — — — — Stockholders’ Equity 307,929 307,561 308,366 289,399 255,970 Statement of Cash Flows Data Net cash provided by operating activities $ 52,644 $ 58,909 $ 97,203 $ 51,015 $ 97,242 Depreciation and amortization 23,822 21,611 18,603 16,926 16,304 Capital expenditures 19,672 32,092 53,115 28,411 34,090 Dividends paid 20,837 20,468 35,240 33,948 52,446 Share repurchases 4,778 4,991 6,895 29,998 41,809 Other Supplemental Data and Metrics Number of stores 129 129 124 122 121 Retail square footage at year-end (in 000s) 4,543 4,539 4,387 4,363 4,354 Sales per WAVG retail square foot $ 167 $ 164 $ 197 $ 241 $ 232 Average ticket (3) $ 3,530 $ 3,371 $ 3,278 $ 3,171 $ 2,865 Net sales increase (decrease) % 5.0 % (16.1 %) (17.7 %) 3.4 % 35.4 % Comparable store sales increase (decrease) % 2.1 % (16.7 %) (18.4 %) 3.4 % 17.9 % Employees 2,392 2,334 2,574 2,831 2,845 (1) Includes special dividends of $1.00 for Common Stock and $0.95 for Class A Common Stock paid in the fourth quarter of 2023 and 2022, and $2.00 for Common Stock and $1.90 for Class A Common Stock paid in the fourth quarter of 2021 and 2020.
Comparable-store or “comp-store” sales is a measure which indicates the performance of our existing stores and website by comparing the growth in sales in store and online for a particular month over the corresponding month in the prior year.
Comparable-store or “comp-store” sales is a measure which indicates the performance of our existing stores and website by comparing the sales growth in store and online for a particular month over the corresponding month in the prior year.
Net cash provided by operating activities in 2024 was $58.9 million driven primarily by net income of $20.0 million and non-cash adjustments to net income of $27.9 million consisting primarily of depreciation and amortization, stock-based compensation expense and changes in working capital.
Net cash provided by operating activities in 2024 was $58.9 million driven primarily by net income of $20.0 million and non-cash adjustments to net income of $27.9 million consisting primarily of depreciation and amortization and stock-based compensation expense and changes in working capital.
The discussion in this Form 10-K generally focuses on the year ended December 31, 2024 compared to the year ended December 31, 2023. A discussion of our results of operations and changes in financial condition for the 2023 year compared to 2022 has been excluded from this report, but can be found in Part II, Item 7.
The discussion in this Form 10-K generally focuses on the year ended December 31, 2025 compared to the year ended December 31, 2024. A discussion of our results of operations and changes in financial condition for the 2024 year compared to 2023 has been excluded from this report, but can be found in Part II, Item 7.
Administrative expenses are comprised of compensation costs for store personnel exclusive of sales team members, information systems, executive, accounting, merchandising, advertising, supply chain, real estate and human resource departments. 23 Table of Contents We classify our SG&A expenses as either variable or fixed and discretionary.
General and administrative expenses are comprised of compensation costs for store personnel exclusive of sales team members, information systems, executive, accounting, merchandising, advertising, supply chain, real estate and human resource departments. We classify our SG&A expenses as either variable or fixed and discretionary.
WAVG square footage is a daily WAVG based on the ratio of the days open in a period to the total days in the period. 21 Table of Contents Results of Operations The table and discussion below should be read in conjunction with our consolidated financial statements and related notes included in this report.
WAVG square footage is a daily WAVG based on the ratio of the days open in a period to the total days in the period and measures the efficiency of a store to generate revenue. 23 Table of Contents Results of Operations The table and discussion below should be read in conjunction with our consolidated financial statements and related notes included in this report.
Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Form 10-K for the year ended December 31, 2023. Industry The retail residential furniture industry’s results are influenced by the overall strength of the economy, new and existing housing sales, consumer confidence, spending on large ticket items, interest rates, and availability of credit.
Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Form 10-K for the year ended December 31, 2024. Industry Overview The retail residential furniture industry is influenced by the overall strength of the economy, new and existing home sales, consumer confidence, spending on large ticket items, interest rates, and the availability of credit.
See Note 7, “Income Taxes” of the Notes to Consolidated Financial Statements for further information about our income taxes. Liquidity and Capital Resources At December 31, 2024 , we had $120.0 million in cash and cash equivalents, and $6.3 million in restricted cash equivalents. See Note 1 to our consolidated financial statements for further discussion of our restricted cash equivalents.
See Note 8, “Income Taxes” of the Notes to Consolidated Financial Statements for further information about our income taxes. Liquidity and Capital Resources At December 31, 2025 , we had $125.3 million in cash and cash equivalents, and $6.5 million in restricted cash equivalents. See Note 1 to our consolidated financial statements for further discussion of our restricted cash equivalents.
We have reviewed our accounting estimates, and none were deemed to be considered critical for the accounting periods presented. 26 Table of Contents
We have reviewed our accounting estimates, and none were deemed to be considered critical for the accounting periods presented.
Our operating cash flows result primarily from cash received from our customers, offset by cash payments we make for products and services, employee compensation, operations, and occupancy costs. Cash provided by or used in operating activities is also subject to changes in working capital.
Cash flow generated from operations provides us with a significant source of liquidity. Our operating cash flows result primarily from cash received from our customers, offset by cash payments we make for products and services, employee compensation, operations, and occupancy costs. Cash provided by or used in operating activities is also subject to changes in working capital.
Interest (Income) Expense, Net We earned $0.6 million more interest income, net of interest expense, in 2024 than in 2023 due to higher rates paid on cash, cash equivalents, and restricted cash equivalents. Provision for Income Taxes Our effective tax rate was 23.7% in 2024 compared to 22.5% in 2023.
Interest (Income) Expense, Net We earned $1.0 million less interest income, net of interest expense, in 2025 than in 2024 due to lower rates paid on cash, cash equivalents, and restricted cash equivalents. Provision for Income Taxes Our effective tax rate was 26.5% in 2025 compared to 23.7% in 2024.
We believe that our current cash position, cash flow generated from operations, funds available from our credit agreement, and access to the long-term debt capital markets should be sufficient for our operating requirements and to enable us to fund our capital expenditures, dividend payments, and lease obligations through the next several years.
We believe that our current cash position, cash flow generated from operations, funds available from our credit agreement, and access to the long-term debt capital markets should be sufficient for our operating requirements and to enable us to fund our capital expenditures, dividend payments, and lease obligations through the next several years. 26 Table of Contents Our material cash requirements include contractual and other obligations arising in the normal course of business.
(5) Average ticket is calculated by dividing total sales by the number of orders. 22 Table of Contents Net Sales The following outlines our sales and comp-store sales increases and decreases for the periods indicated.
(2) We have no funded debt. (3) Average ticket is calculated by dividing total sales by the number of orders. 24 Table of Contents Net Sales The following outlines our sales and comp-store sales increases and decreases for the periods indicated.
(Approximate in thousands) Proposed 2025 2024 2023 2022 Stores: New or replacement stores $ 15,800 $ 18,000 $ 9,300 $ 7,700 Remodels/expansions 1,200 4,600 2,500 4,400 Other improvements 5,700 4,700 6,900 6,600 Total stores 22,700 27,300 18,700 18,700 Distribution (1) 1,800 2,900 32,400 6,900 Information technology 2,600 1,900 2,000 2,800 Total $ 27,100 $ 32,100 $ 53,100 $ 28,400 (1) In 2023 we purchased one distribution facility that was previously leased.
(Approximate in thousands) Proposed 2026 2025 2024 Stores: New or replacement stores $ 17,300 $ 8,700 $ 18,000 Remodels/expansions 4,400 2,000 4,600 Other improvements 5,500 5,300 4,700 Total stores 27,200 16,000 27,300 Distribution (1) 3,150 1,500 2,900 Information technology 3,150 2,200 1,900 Total $ 33,500 $ 19,700 $ 32,100 (1) In 2023 we purchased one distribution facility that was previously leased.
Our focus is to serve our customers better and distinguish ourselves in the marketplace. 20 Table of Contents Key Performance Indicators We evaluate our performance based on several key metrics which include store traffic, conversion rates, net sales, comparable store sales and written comparable store sales; sales per weighted average square foot; gross profit, selling, general and administrative costs as a percentage of sales; operating income; cash flow; and earnings per share.
Key Performance Indicators We evaluate our performance based on several key metrics which include: • store traffic, • conversion rates, • average ticket and average designer ticket, • net sales, • comparable store sales and written comparable store sales, • sales per weighted average square foot, • gross profit margin, • selling, general and administrative costs as a percentage of sales, • operating income, • cash flow, and • earnings per share.
The goal of utilizing these measurements is to provide tools for economic decision-making, including decisions related to store growth, capital allocation and product pricing. Net sales is the revenue from merchandise sales and related fees, net of expected returns and sales tax. We record our sales when the merchandise is delivered to the customer.
These measurements are used to support management's economic decision-making, including decisions related to store growth, capital allocation and product pricing. Net sales are generated by customer purchases of merchandise and related fees, net of expected returns and sales tax. We record our sales when the merchandise is delivered to the customer.
Investing Activities. Cash used in investing activities in 2024 consisted primarily of $32.1 million of capital expenditures. Cash used in investing activities in 2023 primarily reflected $53.1 million of capital expenditures. Financing Activities. Cash used in financing activities in 2024 consisted primaril y of $20.5 million of quarterly cash dividends and $5.0 million of share repurchases.
Cash used in investing activities in 2025 consisted primarily of $19.7 million of capital expenditures. In 2024, c ash used in investing activities primarily reflected $32.1 million of capital expenditures. Financing Activities. Cash used in financing activities in 2025 consisted primaril y of $20.8 million of quarterly cash dividends and $4.8 million of share repurchases.
Our material cash requirements include contractual and other obligations arising in the normal course of business. These obligations primarily include operating lease obligations and purchase obligations. In addition to our cash requirements, we follow a disciplined approach to capital allocation. This approach first prioritizes investing in the business, followed by paying dividends.
These obligations primarily include operating lease obligations and purchase obligations. In addition to our cash requirements, we follow a disciplined approach to capital allocation. This approach first prioritizes investing in the business, followed by paying dividends. We may also return excess cash to shareholders in the form of share repurchases, cash dividends, or special cash dividends.
Cash used in financing activities in 2023 primarily reflected $19.1 million of quarterly cash dividends, $16.1 of special cash dividends, and $6.9 million of share repurchases. Our investing activities in stores and operations in 2024 , 2023 and 2022 and planned outlays for 2025 are categorized in the table below.
Cash used in financing activities in 2024 primarily refl ected $20.5 million of quarterly cash dividends and $5.0 million of share repurchases. Our investing activities in stores and operations in 2025 , 2024 and 2023 and planned outlays for 2026 are categorized in the table below.
The following table outlines our SG&A expenses by classification: 2024 2023 (In thousands) % of Net Sales % of Net Sales Variable $ 139,859 19.4 % $ 170,472 19.8 % Fixed and discretionary 279,362 38.6 285,340 33.1 $ 419,221 58.0 % $ 455,812 52.9 % Our SG&A costs as a percent of sales for 2024 were 58.0% versus 52.9% in 2023.
The following table outlines our SG&A expenses by classification: 2025 2024 (In thousands) % of Net Sales % of Net Sales Variable $ 141,598 18.7 % $ 139,859 19.4 % Fixed and discretionary 297,729 39.2 279,362 38.6 $ 439,327 57.9 % $ 419,221 58.0 % Our SG&A costs as a percent of sales for 2025 were 57.9% versus 58.0% in 2024.
The method we use to compute comp-store sales may not be the same method used by other retailers. We also track written sales and written comp-store sales. Written sales reflect those instances when a customer makes a deposit or pays in full when placing an order. Written sales shows the current pace or trend of customer transactions.
The method we use to compute comp-store sales may not be the same method used by other retailers. We also track written sales and "written comp-store sales", which represent customer orders prior to delivery. Written sales reflect the current pace or trend of customer transactions.
We made cash payments of $5.0 million for repurchases of 214,500 shares of our Common Stock through open market purchases during 2024 and there is approximately $8.1 milli on at December 31, 2024 that may yet be purchased under the existing authorization. Cash Flows Summary Operating Activities. Cash flow generated from operations provides us with a significant source of liquidity.
We made cash payments of $4.8 million for repurchases of 216,482 shares of our Common Stock through open market purchases during 2025 and there is approximately $3.3 milli on at December 31, 2025 that may yet be purchased under the existing authorization. Cash Flows Summary 27 Table of Contents Operating Activities.
At December 31, 2024 , we had aggregate lease obligations of $218.4 million, with $36.3 million payable within 12 months. See Note 8, “Leases” of the Notes to Consolidated Financial Statements for further discussion of our operating leases.
Leases We use operating leases to fund a portion of our real estate, including our stores, distribution centers, and store support space. At December 31, 2025 , we had aggregate lease obligations of $216.4 million, with $36.0 million payable within 12 months. See Note 9, “Leases” of the Notes to Consolidated Financial Statements for further discussion of our operating leases.
(Amounts and percentages may not always add to totals due to rounding.) December 31, 2024 2023 Net Sales Comp-Store Sales Net Sales Comp-Store Sales Period Ended Dollars in millions % Increase (decrease) over prior period % Increase (decrease) over prior period Dollars in millions % Increase (decrease) over prior period % Increase (decrease) over prior period Q1 $ 184.0 (18.1) % (18.5) % $ 224.8 (5.9) % (6.7) % Q2 178.6 (13.4) (13.6) 206.3 (18.5) (19.1) Q3 175.9 (20.2) (20.5) 220.3 (19.7) (20.7) Q4 184.4 (12.5) (13.7) 210.7 (24.9) (25.5) Year $ 722.9 (16.1) % (16.7) % $ 862.1 (17.7) % (18.4) % Net sales in 2024 decreased $139.2 million or 16.1% compared to 2023.
(Amounts and percentages may not always add to totals due to rounding.) December 31, 2025 2024 Net Sales Comp-Store Sales Net Sales Comp-Store Sales Period Ended Dollars in millions % Increase (decrease) over prior period % Increase (decrease) over prior period Dollars in millions % Decrease over prior period % Decrease over prior period Q1 $ 181.6 (1.3) % (4.8) % $ 184.0 (18.1) % (18.5) % Q2 181.0 1.3 (2.3) 178.6 (13.4) (13.6) Q3 194.5 10.6 7.1 175.9 (20.2) (20.5) Q4 201.9 9.5 8.2 184.4 (12.5) (13.7) Year $ 759.0 5.0 % 2.1 % $ 722.9 (16.1) % (16.7) % Net sales in 2025 increased $36.1 million or 5.0% compared to 2024 due to price increases on select merchandise to mitigate the impact of tariffs and higher demand for our products due to the effectiveness of our advertising and marketing initiatives.
Occupancy costs include rents, depreciation charges, insurance and property taxes, repairs and maintenance expense and utility costs. Delivery costs include personnel, fuel costs, and depreciation and rental charges for rolling stock. Warehouse costs include personnel, supplies, depreciation, and rental charges for equipment. Advertising expenses are primarily TV and digital media production and space expenditures, market research expenses and agency fees.
Delivery and transportation costs include personnel, fuel costs, depreciation and rental charges. 25 Table of Contents Warehouse costs include personnel, supplies, depreciation, and rental charges for equipment. Advertising and marketing expenses are primarily TV and digital media expenditures, market research expenses and agency fees.
SG&A dollars decreased $36.6 million, or 8.0%, for 2024 compared t o 2023 . The change was driven by the reduction in sales, lower variable costs, and less leveraging of fixed costs. Our selling expenses decreased $18.5 million, largely due to lower commissioned-based compensation and third-party creditor costs.
SG&A dollars in creased $20.1 million, or 4.8%, for 2025 compared t o 2024 . The change was driven by increased sales and less leveraging of fixed costs. Our selling expenses increased $3.0 million, largely due to higher commissioned-based compensation. Our administrative expenses increased $11.3 million from 2024 due to higher salaries, performance-based incentive compensation and stock-based compensation costs.
Accounting estimates are considered critical if both of the following conditions are met: (a) the nature of the estimates or assumptions is material because of the levels of subjectivity and judgment needed to account for matters that are highly uncertain and susceptible to change and (b) the effect of the estimates and assumptions is material to the financial statements.
We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, and evaluate our estimates and judgments required by our policies on an ongoing basis and update them as appropriate based on changing conditions. 28 Table of Contents Accounting estimates are considered critical if both of the following conditions are met: (a) the nature of the estimates or assumptions is material because of the levels of subjectivity and judgment needed to account for matters that are highly uncertain and susceptible to change and (b) the effect of the estimates and assumptions is material to the financial statements.
In addition, our growth strategy includes the expansion of our retail operations to increase our footprint within our distribution network. The Company’s strategies for profitability include increasing sales volume, maintaining strong gross margins, implementing targeted marketing initiatives, improving productivity and processes, and adopting efficiency and cost-saving measures.
The Company’s strategies for profitability include: • increasing sales volume, • maintaining strong gross margins, • implementing targeted marketing initiatives, • improving productivity and processes, and • adopting efficiency and cost-saving measures. 22 Table of Contents To support our objectives in 2025, we increased our investment in advertising and marketing initiatives and adopted a more aggressive promotional strategy.
Selling, General and Administrative Expenses SG&A expenses are comprised of five categories: selling, occupancy, delivery and certain warehousing costs, advertising, and administrative. Selling expenses are primarily comprised of compensation of sales team members and sales support staff, and fees paid to credit card and third-party finance companies.
Selling expenses are primarily comprised of compensation of sales team members and sales support staff, and fees paid to credit card and third-party finance companies. Occupancy costs include rents, depreciation charges, insurance and property taxes, repairs and maintenance expense and utility costs.
Design consultant engagement increased in 2024 and accounted for 33.6% of our 2024 total written sales, with an average written ticket of $7,222. (See Note 2, "Revenues and Segment Reporting" of the Notes to Consolidated Financial Statements).
The average ticket value in 2025 was $3,530, up 4.7% over last year. Design consultant engagement contributed 33.5% of our 2025 total written sales, with an average written ticket of $7,781. (See Note 2, "Revenues" of the Notes to Consolidated Financial Statements).
The changes in working capital were driven primarily by a $10.5 million decrease in inventories, a $7.0 million decrease in other assets and liabilities, and a $4.9 million increase in customer deposits offset by a $11.4 million decrease in accrued liabilities and vendor repayments. 25 Table of Contents Net cash provided by operating activities in 2023 was $97.2 million driven primarily by net income of $56.3 million and non-cash adjustments to net income of $26.7 million consisting primarily of depreciation and amortization and stock-based compensation expense, and by working capital changes driven primarily by a $24.4 million decrease in inventories partly offset by a $12.1 million reduction in customer deposits.
The changes in working capital were primarily driven by a $10.5 million decrease in inventories, a $7.0 million decrease in other assets and liabilities, and a $4.9 million increase in customer deposits offset by a $11.4 million decrease in accrued liabilities and vendor repayments. Investing Activities.
We are recognized as a provider of high-quality fashionable products and exceptional service in the markets we serve. Management Objectives Management is focused on capturing more market share and improving profitability. This growth will be driven by concentrating our efforts on our customers, with improved interactions highlighted by new products, high-touch service and better technology.
We are recognized in our markets for offering high-quality, fashionable products and delivering exceptional customer service. Management Objectives Management remains focused on gaining market share and improving profitability. These objectives can be achieved by concentrating our efforts on improving our customer's experience, highlighted by new products, high-touch service, and upgraded technology.
Gross profit as a percentage of net sales was 60.7% in 2024 and 2023. The positive impact generated from the change in the LIFO reserve decreased by $8.6 million to $0.8 million in 2024. Excluding the impact of LIFO, our gross profit margins increased 100 basis points due to product selection and merchandising mix.
Gross profit as a percentage of net sales was 60.7% in 2025 and 2024 . Due to changes in tariff policy and higher costs of goods sold under LIFO, the 2025 change in LIFO reserve generated a negative impact of $4.7 million, compared to a positive impact of $0.8 million in 2024.
Long-Term Debt We currently have a $80.0 million revolving credit facility (the "Credit Agreement") with a bank. As of December 31, 2024 , we had no outstanding borrowings and $80.0 million of available borrowings under the Credit Agreement. The Credit Agreement matures October 24, 2027.
As of December 31, 2025 , we had no outstanding borrowings and $80.0 million of available borrowings under the Credit Agreement. The Credit Agreement matures October 24, 2027. See Note 6, “Credit Arrangement” of the Notes to Consolidated Financial Statements for information about our Credit Agreement.
We may also return excess cash to shareholders in the form of share repurchases or special cash dividends. We expect capital expenditures of approxima tely $27.1 million in 2025 to support our operations and strategic expansion, however these plans are subject to other potential opportunities, the economic environment, general business conditions and our financial performance.
We expect capital expenditures of approxi mately $33.5 million in 2026 to support our operations and strategic expansion, however these plans are subject to other potential opportunities, the economic environment, general business conditions and our financial performance. Long-Term Debt We currently have a $80.0 million revolving credit facility (the "Credit Agreement") with a bank.
Our products are selected to appeal to a middle to upper-middle income consumer across a variety of styles. Our commissioned sales team members receive a high level of product training and are provided a number of tools with which to serve our customers. We also have over 120 in‑home designers serving most of our stores.
Business Overview We sell home furnishings in retail stores and online, recording revenue when products are delivered to the customer. Our product assortment is selected to appeal to middle to upper-middle income consumers across a variety of styles. Our commissioned sales team members receive comprehensive product and customer service training to ensure we provide a high-quality in-store experience.
Occupancy costs increased $5.6 million, primarily due to increased depreciation expense and a $3.3 million reduction of rent expense in the prior year, which was attributed to an incentive to vacate a property before the end of its lease term.
Advertising and marketing expenses increased $3.3 million from 2024 to 2025, due to an increased investment in television and direct mail advertising during the year. Occupancy costs increased $5.0 million, primarily due to increased depreciation expense, rent expense, and state and local taxes from the prior year.
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These factors remain tempered by impediments to industry growth, such as inflation, higher interest rates, rising consumer debt, home inventory constraints, tight access to home mortgage credit, and continuing economic uncertainty. Our Business We sell home furnishings in our retail stores and via our website and record revenue when the products are delivered to our customer.
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Although inflation and home sales showed modest improvement in 2025, the industry continued to face headwinds from rising consumer debt, constrained housing inventory, tight access to home mortgage credit, and ongoing economic uncertainty driven by changes in tariff policy and geopolitical tensions.
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These individuals work with our sales team members to provide customers additional confidence and inspiration in their furniture purchase journey. We do not outsource the delivery function, something common in the industry, but instead ensure that the “last contact” is handled by a customer-oriented Havertys delivery team.
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Throughout 2025, the current U.S. presidential administration announced new and modified tariffs on imported goods, including those sourced from China, Vietnam, and other key manufacturing regions. In response, several affected countries implemented retaliatory tariffs, adding economic uncertainty and increased cost pressures across the industry.
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(2) Includes gain of $31.6 million on a sale-leaseback transaction in 2020 which impacted diluted earnings per share $1.24.
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The evolving tariff landscape has led many home furnishing retailers to adjust sourcing strategies, reassess vendor relationships, and implement pricing actions in an effort to mitigate the impact of these policy changes. On February 20, 2026, certain tariffs were invalidated following a ruling by the U.S.
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(3) Includes special dividends of $1.00 for Common Stock and $0.95 for Class A Common Stock paid in the fourth quarter of 2023 and 2022, and $2.00 for Common Stock and $1.90 for Class A Common Stock paid in the fourth quarter of 2021 and 2020. (4) We have no funded debt.
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Supreme Court, adding further uncertainty to the trade environment, particularly with respect to the scope and timing of any recovery related to the invalidated tariffs and the impact of new tariffs the administration has announced. We continue to assess the impact of tariff policy changes on our business.
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The housing recession, inflationary pressures, and cautious consumer spending due to economic uncertainty contributed to the sales decline. Our sales associates and design consultants are providing excellent service to each customer. The average ticket value in 2024 was $3,371, up 3.0% over last year.
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We also aim to have at least one designer serving each of our stores. These individuals collaborate with our sales team to provide customers additional confidence and design inspiration throughout the purchasing process.
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Warehouse, delivery, and transportation expenses decreased $13.7 million from 2023 to 2024, primarily due to reduced personnel levels and lower variable transportation and fuel costs. Our administrative expenses decreased $6.4 million from 2023 due to lower salary and stock-based compensation costs. Advertising expenses decreased $3.0 million from 2023 to 2024, aligning with the reduction of sales.
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Unlike many of our competitors, we do not outsource the delivery function; instead, our Haverty's delivery team ensures a seamless and professional experience, which includes a detailed inspection of the product prior to delivery, as well as placement and assembly of the furniture in the customer's home.
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See Note 5, “Credit Arrangement” of the Notes to Consolidated Financial Statements for information about our Credit Agreement. 24 Table of Contents Leases We use operating leases to fund a portion of our real estate, including our stores, distribution centers, and store support space.
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In addition, our growth strategy includes the expansion of our retail operations to increase our footprint within our distribution network.
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We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, and evaluate our estimates and judgments required by our policies on an ongoing basis and update them as appropriate based on changing conditions.
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Similar to other home furnishing retailers, our business was impacted by the current U.S. presidential administration's tariff policy implemented in 2025.
Added
To mitigate the impact of such tariff policy in 2025, we: • leveraged our strong vendor relationships to minimize price increases, • implemented targeted price increases on select products, • reduced our China product sourcing to less than 5% of purchases, and • re-sourced and re-assorted products, as needed.
Added
Despite the challenges facing the home furnishings industry, we increased net sales by 5.0%, comparable-store sales by 2.1% and maintained a gross profit margin of 60.7%. This performance reflects the disciplined execution of our strategic initiatives and our continued focus on operational efficiency and delivering a high-quality experience for our customers.
Added
Sales growth was achieved despite ongoing pressure from a soft housing market, driven by elevated mortgage rates and heightened economic and geopolitical uncertainty, which creates a challenging demand environment for the home furnishings industry. Our sales team and design consultants continue to provide excellent service to our customers.
Added
Excluding the impact of LIFO, our gross profit margins increased 70 basis points due to product selection, merchandise pricing and mix. Selling, General and Administrative Expenses SG&A expenses are comprised of five categories: • selling, • occupancy, • transportation, delivery and certain warehousing costs, • advertising and marketing, and • general and administrative.
Added
Warehouse, delivery, and transportation expenses decreased $2.4 million from 2024 to 2025, primarily due to increased productivity in our warehouse operations and lower payroll related benefits and insurance costs.
Added
Net cash provided by operating activities in 2025 was $52.6 million driven primarily by net income of $19.7 million and non-cash adjustments to net income of $30.5 million consisting primarily of depreciation and amortization, stock-based compensation expense and changes in working capital.
Added
The changes in working capital were driven primarily by a $12.7 million increase in inventories and a $5.2 million decrease in customer deposit offset by $12.3 million decrease in other assets and liabilities and a $8.1 million increase in accrued liabilities and vendor repayments.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed2 unchanged
Biggest changeWe do not believe that an increase or decrease in interest rates of 100 basis points would have a material effect on our operating results or financial condition. During 2024 and 2023 , we had no outstanding borrowings under our Credit Agreement (as discussed in Note 5 to the Consolidated Financial Statements), which bears interest based on variable rates.
Biggest changeWe do not believe that an increase or decrease in interest rates of 100 basis points would have a material effect on our operating results or financial condition. During 2025 and 2024, we had no outstanding borrowings under our Credit Agreement (as discussed in Note 6 to the Consolidated Financial Statements), which bears interest based on variable rates.

Other HVT 10-K year-over-year comparisons