1-800-Flowers (FLWS) Q3 2026 Earnings Transcript

Chief Executive Officer — Adolfo Villagomez

Chief Financial Officer — James Langrock

Adolfo Villagomez: Thanks, Andy, and good morning, everyone. As we move through fiscal 2026, we remain focused on stabilizing the business and building a stronger foundation for future growth. During the third quarter, we continue to make progress on the key initiatives we outlined earlier this year, and we are starting to see early signs that our actions are improving execution and the overall customer experience. I want to start with our Valentine's Day performance, which is an important indicator of that progress. This year, we delivered a significantly improved customer experience with strong gains across our key service metrics. These results reflect better execution, stronger processes and a clear focus across the organization on delivering a high-quality experience for our customers.

Importantly, this progress validates many of the structural and operational changes we have been implementing. We are now beginning to see tangible evidence that these actions are improving performance across key areas of the business. While there is still work to do, we are encouraged by these results and the direction of the business. From a category perspective, our Gourmet Foods and Gift Baskets segment performed better than our Consumer Floral and Gifts segment. As James will discuss in more detail, this reflects the Easter timing shift and the heavier level of inefficient marketing spend in our Consumer Floral and Gifts segment a year ago, combined with our focus on improving marketing contribution margin.

As part of our efforts to broaden our customer reach, we also continue to expand our presence across third-party marketplaces. Ahead of Valentine's Day, we launched a new partnership with Instacart. This builds on our strategy to meet customers where they are already shopping and to expand access to our floral and gifting value proposition. Through this partnership, our offerings are now available on the Instacart app, supported by our network of local florists. This increases speed and accessibility, particularly during peak occasions while also supporting our florist partners and introducing our brands to new customers. At the same time, we're strengthening our focus on the customer experience across our digital platforms.

During the quarter, we fully implemented AI-powered sorting and ranking on 1-800-FLOWERS.com. This brings customer selected best sellers to the top of our product rankings and reflects a more AI-driven customer-first approach. This is an important step in modernizing the business. Historically, product placement was more heavily influenced by merchants. Today, we are prioritizing the products customers choose, which improves the overall shopping experience and results in higher sales. We are simplifying the shopping experience by reducing choice in certain areas to make it easier for customers to find the right gift. In addition, we are evolving how we operate our floral business, including how we balance florist-fulfilled orders with shipments fulfilled from our distribution centers.

We are now operating these areas in a more coordinated way with our florist-fulfilled product team and direct shipment team working together on assortment decisions. This approach has multiple advantages. It improves the overall value proposition for our customers by simplifying the shopping experience, improving conversion and better aligning pricing for similar bouquets. Importantly, we made significant progress on our cost savings initiatives, achieving our previously announced $50 million in savings 2-year target in less than a year. This reflects the discipline and execution across the organization and strengthens our ability to reinvest in the business while continuing to improve efficiency.

As we realize these savings, we are beginning to thoughtfully reinvest a portion back into the business to support our strategic priorities, including marketing and customer experience. These results are driven by the continued progress we are making on our cost and efficiency initiatives. As part of our transition to a function-driven operating model, we have streamlined the organization, improving alignment, driving synergies and enabling more efficient decision-making across the business. Since January 2025, we have reduced core headcount by approximately 20% as we align resources with our strategic priorities and improve efficiency across the organization.

We are beginning to see cost savings from these actions, although in the short term, they are partially offset by consultant costs, incentive compensation and tariffs. Looking ahead, as our strategic initiatives take hold, we are beginning to shift toward a more balanced approach that includes targeted marketing investments to support future growth. Last year, our marketing efforts were heavily focused on bottom of the funnel activities, primarily focused on driving transactions, and we did not have the systems or infrastructure in place to effectively drive customer retention. Over the past 9 months, we have made meaningful progress in developing those capabilities. We are now in a position to begin rebuilding our brands.

We're also expanding our reach to younger customers through top and mid-funnel initiatives, including influencer marketing and platforms like Instagram and TikTok. At the same time, we're improving our ability to retain customers. As I mentioned earlier, we have significantly enhanced the customer experience by improving areas such as delivery fees and overall customer satisfaction, which are key drivers of long-term retention. Beginning in the fourth quarter, we're accelerating and testing these targeted marketing investments. While these efforts are expected to take time to translate into revenue, they are an important step in rebuilding demand in a more sustainable way.

As part of this shift, we expect marketing spend in the fourth quarter as a percent of sales to be approximately flat compared to the prior year period. In addition to these marketing investments, we're also beginning to invest in building out our Martech stack. These investments will begin in the fourth quarter and continue into the next fiscal year as we strengthen the capabilities needed to support long-term growth. More broadly, while cost discipline remains a priority, we believe these actions, combined with our structural improvements are strengthening the foundation to stabilize the business and enable long-term growth. Now I will turn the call over to James for the financial review.

James Langrock: Thanks, Adolfo, and good morning, everyone. During the third quarter, revenue came in line with our expectations, reflecting continued execution against our disciplined marketing approach and the ongoing impact of changes in search engine results and pressure on direct traffic. Valentine's Day was consistent with our expectations, particularly given the difficult day placement as the holiday fell on a Saturday and during President's Day weekend. As we progressed into March, we began to see a moderation in the rate of revenue decline in our Consumer Floral and Gift segment as we anniversaried some of the strategic shifts in our marketing approach.

From a category perspective, our Gourmet Foods and Gift Baskets segment performed meaningfully better than our Consumer Floral and Gift segment during the quarter. Gourmet Foods and Gift Baskets segment benefited from an approximate 5% revenue lift from the timing of Easter. This performance also reflects the more pronounced impact of prior year inefficient marketing spend in our Consumer Floral and Gift segment, along with ongoing changes in search engine results and pressure on direct traffic. During the quarter, we recorded a noncash goodwill and trade name impairment charge related to our Consumer Floral and Gift segment and the Personalization Mall trade name. While this impacted earnings, it did not affect cash flow.

From a profitability standpoint, we saw improvement in our ad-to-sales ratio and marketing contribution margin compared to last year. Overall, our contribution margin improved year-over-year, reflecting stronger pricing discipline and improved marketing efficiency. Our efforts to streamline operations and manage costs are beginning to have a positive impact on the business. As of the third quarter, we have achieved the full $50 million in annualized run rate cost savings that we had initially targeted across fiscal year 2026 and fiscal year 2027, ahead of plan. Building on this progress, we are now targeting an incremental $15 million to $20 million in additional run rate cost savings over the next fiscal year.

This brings our total identified cost savings opportunity to approximately $65 million to $70 million, spanning both cost of goods sold and operating expense reductions, reflecting continued opportunities to streamline the business and improve efficiency. Importantly, we are being thoughtful about how we deploy these savings. As we move into the fourth quarter and into next fiscal year, we are transitioning from a primary focus on marketing contribution margin toward a more balanced approach that includes strategic investment. This shift is expected to impact our fourth quarter performance.

As part of this shift, we are accelerating and testing targeted marketing investments, including top and mid-funnel initiatives, which are intended to support longer-term demand generation and may take time to translate into revenue. Consistent with this approach, we expect total marketing spend as a percentage of sales in the fourth quarter to be approximately flat compared to the prior year period. In addition, we are beginning to invest in enhancing our digital experience and expanding our Martech capabilities, which will support improved customer acquisition, retention and overall marketing effectiveness over time. Investments will begin in the fourth quarter and continue into the next fiscal year.

This approach reflects our focus on building a stronger and more sustainable operating foundation by balancing profitability with the investments needed to stabilize the business and position it for future growth. Now let's review our third quarter performance. Consolidated revenue for the quarter decreased 11.6%. Our Gourmet Foods and Gift Baskets segment was essentially flat. Our Consumer Floral and Gifts segment declined 18.7% and our BloomNet segment declined 5.9% for the reasons discussed earlier. Excluding the impact of system-related issues in the prior year period, our gross margin improved 10 basis points to 33.2%, reflecting benefits from our cost reduction initiatives, partially offset by tariffs, commodity costs and fixed cost absorption.

Excluding items affecting period-to-period compatibility and the impact of the company's nonqualified deferred compensation plan in both periods, operating expenses declined $16.4 million as compared to prior year to $144.3 million. As a result of these factors, our third quarter adjusted EBITDA loss was $31.2 million compared with an adjusted EBITDA loss of $34.9 million in the prior year period, reflecting a modest year-over-year improvement. Now turning to our balance sheet. At quarter end, net debt was $94.3 million, compared with $75.3 million a year ago. Our cash balance was $51 million at the end of the third quarter. Inventory was $146 million, compared with $160 million a year ago.

In terms of our debt, we had $145 million in term debt and no borrowings under our revolving credit facility as compared with $160 million a year ago. As we look ahead, we continue to view fiscal 2026 as a foundational year focused on stabilizing the business, improving execution and building a stronger platform for long-term growth. Our strategic priorities remain centered on enhancing our customer-first approach, expanding third-party distribution, improving marketing efficiency and driving structural cost savings. We believe these actions are strengthening the foundation for sustainable revenue and profit growth over time.

Fiscal year 2026, we expect revenue to decline by approximately 10% to 12% as compared with the prior year and adjusted EBITDA to be approximately breakeven within a range of plus or minus $2 million, which includes approximately $22 million of anticipated incentive compensation and consultant costs incurred during the fiscal year. These expectations reflect our more disciplined marketing strategy, ongoing changes in search engine results affecting organic traffic and our transition toward a more efficient demand generation model. Now we'll open the call for Q&A. Operator, please provide instructions for those interested in asking a question.

Operator: [Operator Instructions] Our first question comes from Anthony Lebiedzinski with Sidoti & Company. Please go ahead.

Anthony Lebiedzinski: Good to hear that you had a successful Valentine's Day even with an adverse calendar day placement. So I guess, first on that topic, I guess, can you share any additional details as far as the customer experience metrics that improved? And what are some of the learnings from that holiday that you're looking to apply towards Mother's Day, which is coming up in a few days?

Adolfo Villagomez: Anthony, this is Adolfo. So there are a lot of learnings coming out of Valentine's Day. We're literally transforming the business from a merchandising perspective, a digital perspective and marketing. So let me -- and by the way, also our post-purchase experience has significantly improved. Before I go to the learnings, I also want to be mindful that between Valentine's Day and Mother's Day, there is not a lot of room to make a lot of changes. I mean you need to buy flowers ahead of time. So you can make some changes, but not all of them. So Mother's Day, it's going to do better across those metrics, but don't expect the full performance impact just yet.

But as we think about the changes we're making, let me start with digital. It used to be that the merchants would place a buy and they decided, "Hey, you're buying roses," or "You are buying lilies." And they would be at the top of the product page, which most customers make a decision on those products. 65% of the sales come above the fold on any website. So if you don't have the right product, your conversion declines. As I mentioned, we are now using AI-driven sorting and ranking. So number one, conversion is improving.

But most importantly, we are also finding out what customers really want and what they are willing to pay, not only from a type of spend, but also from delivery method and delivery fees they are willing to pay. So we learned a lot from that perspective. From a marketing perspective, I want to remind everybody that, I mean, the reason Flowers did worse than Food is our marketing spend there last year was heavily unproductive. As an example, we were buying transactions for $40 and making $20 margin on each transaction, then you would say, well, that's great because we are acquiring a customer. Well, yes, that's true if you retain the customer.

But if you don't retain them, then you are just wasting dollars. So we're working on both is lowering our customer acquisition cost and improving our retention. The second one requires the Martech stack. We're making improvements, but we are not 100% there yet. But on the first one, the team started experimenting going top of the funnel and mid-funnel. In the past, the company just wouldn't like that because there was so much focus on the -- they were so focused on the transaction and the measurement capabilities we have would lead you to believe that buying clicks was the most effective marketing method.

What we are finding out as we have more, I would say, better measurement capabilities, is that's not true. If you do it right, top of the funnel and mid-funnel investments also drive customer acquisition. By the way, it allows you to acquire younger customers, which also longer term, it's better. So the team was experimenting with podcasts, TikTok, Instagram, all of them with huge success and which will be expanded in the future. From an assortment perspective, one of the things we started testing was just first, our mix between florist delivered and direct from our warehouses.

In the past, the team, because they had already made the purchase and we own the inventory, using this manual sorting and ranking would favor the direct delivery, which combined with the assortment we were offering there, led to lower conversion. And by the way, then at the end of the event, because we had a lot of inventory, they would do heavy discounting. We are managing through that. There were huge learnings during Valentine's Day. Again, some of those are being applied on Mother's Day. And we continue to learn in Mother's Day. I'm actually super excited about the learnings and the implications for assortment. But it's a process.

The other thing we -- I think on our operations, this is the type of stuff you don't see in the short term on the balance sheet. But our customer satisfaction post-purchase increased. Our calls to the call center declined on a per order basis. And now that we're also using AI on the call center, we're able to be significantly more productive with a better customer experience. So all in all, again, it was one event, one of the multiple businesses we have. But a lot of learnings that some of them are being applied during Mother's Day. But certainly, they will be fully applied during the upcoming holidays.

So very optimistic about the improvements to the overall experience in the future.

Anthony Lebiedzinski: Just switching gears to the cost savings program. So you talked about completing the $50 million cost savings program, but you're also looking to reinvest some of that into the business. So how should we think about cost savings on a net basis? And maybe you could just talk about OpEx versus the cost of goods, how to think about that?

James Langrock: So Anthony, to answer the second question, right now, the $50 million savings is probably split equally between cost of goods sold and SG&A. So that's on that front. As we -- as you think of the cost savings, as we mentioned on the call, some of those savings will be reflected, but not all of those will flow through this year. Near term, we have the consulting costs for implementing initiatives. And again, we still have some of the headwinds around tariffs and commodity costs. So that's offsetting some of those benefits. So we'll see the consulting costs starting in FY '27. We'll no longer have those consulting costs. So more of that will flow through.

But we're being very thoughtful on how we deploy those savings, Anthony. So as you look to going into '27, those savings give us more flexibility in the model, but we're going to be very deliberate on how we deploy those and start investing back in the business. So it's not going to be a dollar-for-dollar flow-through EBITDA. So we're not -- we haven't given guidance yet for FY '27, but think of it in the context, we have the savings, but we are going to deploy those. So it will not be a dollar-for-dollar flow-through on the EBITDA side.

Anthony Lebiedzinski: Right. Okay. And can you just remind us about the consultant costs, how much for this fiscal year?

James Langrock: So the consultant costs will be the total between incentive compensation and the consulting costs, Anthony, it's about $22 million that's in this year's current P&L. The consultant costs are about $12 million to $13 million of that.

Operator: And the next question comes from Michael Kupinski with NOBLE Capital Markets.

Michael Kupinski: With your changes in marketing, have you kind of opened the door to competitors? And I was just wondering if you can talk a little bit about whether or not you have seen increased marketing from competitors, especially during Valentine's or certainly around Mother's Day, particularly like from low-cost providers like Bouqs or any impact from them, for instance?

Adolfo Villagomez: Short answer is yes. Flowers, it's a very competitive business, especially during those events. And I think Google makes it very easy for anybody just to buy other people's brands. So which was, I think, primarily the reason why if you only focus on buying clicks, your customer acquisition cost becomes significantly higher. What we are doing now is leveraging the brand awareness of 1-800-FLOWERS.com.

Anywhere I go and I talk to people, they tell me, say, "Hey, Adolfo, I think your company is the only one that gets, I'm going to call it, natural or direct traffic, and everybody else needs to buy the clicks." The way you do more of that is you need to continue to build the brand. And that's what we are doing. And in general, the bottom-of-the-funnel transactions do not build a brand. They just lead to transactions. Middle and top funnel build the brand, build awareness so that you're in the subconscious of the customer and eventually, when they have a need, they think about you. We have been, as I mentioned, successful on that.

But as James mentioned, you need to make investments. And sometimes this top-of-the-funnel, you will invest now and you won't see the benefits until next month or next quarter. That's why we are being cautious about how we invest, how we learn about the business. But the idea is that the most important asset we have, it's our brand. And unfortunately, we hadn't invested in the brand for a while. We are reversing that. We're reinvesting in the brand. And as I mentioned, we are reinvesting on the digital experience. Our product discoverability in the website is improving. I think every day, we have new enhancements, and we are also improving our ability to retain customers.

That flywheel is what will allow us to differentiate ourselves versus our competitors. Personalization to the customer, a better experience, AI to drive reminders, to drive recommendations to the customer to increase conversion. And as I mentioned, we're modernizing the brand to continue building that brand awareness.

Michael Kupinski: Got you. And I know that the business is heavily correlated to consumer confidence. I was wondering if you can determine whether or not there was an impact by the war in Iran. And then also, I was just wondering if you can just talk a little bit about your third-party platforms like Amazon, DoorDash. And I was wondering if you can just kind of talk a little bit about what percent of revenue do you expect to achieve from marketplaces like, let's say, over the next 2 to 3 years?

Adolfo Villagomez: Got it. So let me start with the first one. Impact of the Iran war, very difficult to see that in the numbers. What we are seeing is, I think, what this country has seen for a while, which is higher income spenders are doing okay, lower income are not. You can clearly see that in the numbers, the AOV that it's selling and what's not selling. honestly, that hasn't changed much since I joined the company. So whether there was an impact from the war or not, it is very difficult to say. What was the second one? I'm sorry. Marketplace.

So marketplace, the way I think about it or the way we are thinking about it as a team is it's a way -- it's a twofold strategy. Number one, by selling to, I would say, professional e-commerce marketplaces like Amazon, you do learn a lot. You learn a lot about your own operations. You learn a lot about what's working on websites, what drives conversion. So that one will have a second level impact on everything we do. It's fascinating what we have learned in the last 6 months since we started selling on Amazon. Now to -- okay, how much should we expect on that?

I mean if you are talking about 3 years from now, I think the sales from our -- sales outside our own e-commerce site should definitely be double digits of the company. And again, when I think about these, keep in mind, we are doing marketplaces like Amazon, Walmart and Etsy. And we're also doing delivery service providers, especially for our flowers business. We announced Instacart, but we're also doing DoorDash and Uber Eats. The intention here is we want to be where the customers are shopping. We do have a website, but we also have operations. We manufacture product and we represent our florists.

So I think there was a huge miss from our side not to be in those channels, which we are trying to correct. It's early days, but we are -- it's growing really, really fast from low numbers, but we're optimistic about that.

Michael Kupinski: And as we kind of think of the inflection point and coming out of the -- more of the growth phase of the company, I was just wondering what would be now the true baseline growth rate of the businesses now? Like historically, we had looked at 3% to 5% revenue growth and about 8% EBITDA growth. And I was just wondering if you had any thoughts in terms of the baseline growth rate coming out of this inflection point.

James Langrock: So Michael, we're not giving guidance yet for FY '27. So we believe longer term, further out, we would get back to those growth rates.

Adolfo Villagomez: And let me build on that, Michael. It's a process and we are sequencing. I think -- I mean, I've been in this role, I think to this day, it's a year. When I joined, we were declining at a rate of 20-plus percent. From there, you need to suddenly stop declining, you get to 1 or 2 days of positive comps, then you get to a week in one business and then you want the entire company to drive growth. We are seeing those positive days and those positive weeks in businesses. But I mean, it's a process. We -- at some point, we want the company to grow.

And then it's going to be or we're building a very different business model. The previous one was manually driven. And the new one is going to be AI technology-driven. So I'm cautiously optimistic about what this company can deliver in the future, but it is a process. And the only thing we can tell you at this point is we are ahead of where we thought we would be, but there's still a lot of work in front of us.

Michael Kupinski: It sounds like you made a lot of progress.

Operator: Okay. The next question comes from Doug Lane with Water Tower Research.

Douglas Lane: Just staying on the whole margin cost side of things. It looks like your EBITDA outlook this year improved a little bit despite the fact that you have $10 million more of the incentive comp and consulting costs running through it than you had last quarter. So it looks like the underlying margin outlook has improved pretty decently since you last reported results. So where are the 2 or 3 key areas that you're seeing the improved margins on the EBITDA level?

James Langrock: So Doug, it's -- part of it, as you mentioned, part of it is we are starting to see some of the cost benefits flow through on the gross margin. So we're seeing that. And as Adolfo mentioned, with -- on the floral side, with the florist-fulfilled versus direct, we're seeing much more pricing discipline, more targeted promotional activity, as we mentioned, a better coordination between the florist-fulfilled and the direct shipment. So we're seeing that overall improve the gross margin and improved AOV. So we're being more consistent with our pricing decisions and again, reducing discounts, which is improving our overall margin quality.

Now part of that's still being offset, Doug, by the higher tariff and commodity and shipping costs. But overall, our gross margin on a year-over-year basis was up about 10 basis points. So we are starting to see that flow through and the strategy is working.

Douglas Lane: Well, that's what I wanted to probe because you got the $10 million more of the consultants and incentive comp, and you've also got a commodity cost environment that arguably has deteriorated since you last reported results. And then I don't even know what cocoa prices are doing these days, but are the commodity inputs actually down? Is that another thing that you're trying -- that you're having to offset here? I'm just trying to get an order of magnitude of what you're really seeing from your internal cost savings efforts. And it sounds like it's a little bit more than it's obvious by the numbers on the surface.

James Langrock: So I just want to be clear, Doug, that the $22 million is an annualized number, just wasn't for the quarter, right? So I want to make sure that I'm clear on that. So on a -- from a commodity perspective, obviously, cocoa prices are still elevated on a year-over-year basis. What we are seeing is butter, flour and eggs are down on a year-over-year basis. So we're starting to see a little relief on that. As you mentioned, obviously, we are starting to see a little bit of the impact on the fuel surcharges on our outbound shipping because of the increase in the oil prices.

Inbound, we're not -- there's no impact yet on inbound from a fuel standpoint because we have the contracts in place for the remainder of the year. So yes, we have commodity headwinds with cocoa starting to see some relief on the other commodities, still have the impact of tariffs, but we are getting the benefit of the cost savings as well as I just talked about the pricing discipline that we have. So that's what's flowing through. And that's why you're seeing gross margin up slightly this year versus last year.

Douglas Lane: And are you still expecting the consultants to roll off at the end of June? Or are they going to be spilling over into '27?

James Langrock: The costs roll off at the end of June. So we will not have that starting July 1, Doug.

Douglas Lane: And then tariffs as well, you've got some tariff relief here and then you start to anniversary the implementation of tariffs in 2025. So the tariff impact should begin to recede in the first part of fiscal '27 as well, right?

James Langrock: Yes. We still have -- right now, there still are tariffs in place. But yes, we will start to anniversary that, and we'll start to get the benefit of the lower tariff rates in 2027, Doug.

Douglas Lane: Okay. And just one last one for me. You raised the flag that marketing spend as a percent of sales -- not a flag, but just to let us know that marketing spend as a percent of sales will be flat in the June quarter. But going forward, the base case should be improved marketing spending lowers as a percent of sales because it will be more efficient. Is that still the base case? I know you're not giving guidance for '27, but just directionally.

James Langrock: Doug, I would say, potentially, we're planning with some of the savings that we're getting in cost of goods sold and SG&A. Part of that savings is going to be redeployed in marketing. So it's not necessarily that you're going to see marketing percentage as a percentage of sales going down in FY '27 as we make strategic investments in marketing.

Adolfo Villagomez: Let me build on that.

James Langrock: But longer term, Doug. So in the short run, as Adolfo mentioned, we need to invest back in the brand and some of the top-of-the-funnel and mid-funnel. So in the shorter term, you may not see that. But longer term, absolutely, you will start to see the improvement in the spend becoming more efficient.

Adolfo Villagomez: The other thing I would say, building on that, Doug, is 1-800-FLOWERS.com, it's a very different company right now because every investment we make, it's being evaluated and measured versus a control group. So we are making investments. And if there is a lift, whether it's sales of margin, it goes through. If it doesn't -- if we don't see a lift, we can just declare a victory by failing fast and move on. So we are not going to make crazy investments, but we are making investments and we are experimenting. I'm convinced, and I think we all are convinced in this company that really our future is we need to find a way to drive growth.

So the investments that I mentioned on marketing, on the Martech stack, on digital capabilities and so on and so forth are targeted towards that, is how do we invest to drive efficiencies on conversion on the website, traffic from a marketing perspective, conversion from an assortment perspective. And every investment we make is being tested, measured and we decide whether it goes forward or not. So the $50 million in run rate that we already have in our pocket, some of that will flow through the bottom line. Some of that is going to go through investments. But rest assured that when we invest, it's because we want to see a return on that.

So that should help the company in the midterm.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Adolfo Villagomez for any closing remarks.

Adolfo Villagomez: Thank you all once again for joining us today and for your continued support. Fiscal 2026 continues to be a year of stabilization for the company. During the third quarter, we continued to make progress on the initiatives that matter most, and we're beginning to see tangible evidence that these actions are improving execution, strengthening the customer experience and driving more disciplined performance across the business. We're also taking the next step in our transformation as we begin to balance cost discipline with targeted investments, supported by the progress we have made on our cost savings initiatives.

These investments, including marketing and digital capabilities, are beginning in the fourth quarter and will continue into the next fiscal year to support stabilization and future growth. While we recognize that progress will not be linear, we remain focused on executing our strategy with discipline and consistency. The actions we are taking today are intended to stabilize the business and build a strong and durable foundation to support improved performance over time. We appreciate your continued interest in and support of the company, and we look forward to keeping you updated on our progress. Thank you.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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1-800-Flowers (FLWS) Q3 2026 Earnings Transcript was originally published by The Motley Fool