Brand House Collective sees Q3 sales fall as it transitions from Kirkland’s to Bed Bath & Beyond
NASHVILLE, Tenn. —The Brand House Collective, formerly Kirkland’s, reported a decline in net sales and consolidated comparable store sales for the third quarter ended Nov. 1 as it transitions under the pending acquisition by Bed Bath & Beyond Inc.
Net sales for Q3 were $103.5 million, down from $114.4 million in the previous year’s third quarter. Consolidated comp sales, which are inclusive of a comparable store sales increase of 1.7% and an e-commerce decline of 34.6% year-over-year, were down 7.4%, while store count fell by 6%.
Gross profit was $21.1 million, or 20.4% of net sales, compared with $32.1 million, or 28.1% of net sales year-over-year. The company attributed the drop to a decline in merchandise margin and the deleveraging of store occupancy costs on lower sales. The company has been engaging in liquidation to optimize inventory ahead of expanding Bed Bath & Beyond assortments. Incremental tariff costs were also cited.
“Our inventory optimization efforts are strategically supporting our store conversion program,” said CEO Amy Sullivan, “creating space for expanded Bed Bath & Beyond assortment as we transform our retail footprint.
“The successful conversion of our Tennessee locations to the Bed Bath & Beyond Home format demonstrates the progress we’re making in the evolution. Looking ahead, the pending merger with Bed Bath & Beyond will combine our complementary strengths and will enable us to build a powerful omnichannel platform for sustained growth,” she said.
“We are confident this combination with strengthen our comprehensive home retail offering, unlock meaningful operational and financial synergies, and deliver increased earnings power with enhanced long-term growth potential for all shareholders.”
Operating expenses for the quarter were $23.1 million vs. $34.5 million in the prior year. The reduction in expenses was driven by reduced marketing spend and lower cost for self-insured employee benefits as well as a $10 million gain on the sale of the Kirkland’s brand to Beyond.
Adjusted EBITDA in Q3 2025 was a loss of $9.9 million compared with income of $500,000 in Q3 2024. Net loss in the quarter was $3.7 million, or a loss of 16 cents per diluted share vs. $7.7 million, or a loss of 59 cents per diluted share in the Q3 2024.
As of Nov. 1, inventory was $88.9 million, down from $112.2 million on Nov. 2, 2024.
During the period, the company closed three Kirkland’s Home stores and converted three stores to Bed Bath & Beyond Home stores, ending the quarter with 303 Kirkland’s and three Bed Bath & Beyond Home stores across 35 states.
Because of the pending acquisition, the company didn’t conduct an earnings call related to Q3 results.
