1-800-FLOWERS experienced a challenging third quarter, with results falling short of Wall Street’s expectations and the market responding negatively. Management attributed the underperformance primarily to continued weakness across its non-core websites and B2B operations, as well as gross margin pressure from deliberate investments in merchandising and pricing strategies. CEO Adolfo Villagomez acknowledged that, while demand on the company’s primary websites declined, the rate of decrease moderated compared to the prior year, stating, “the decline moderated further to low single digits compared to double digits last year, which is encouraging.”
Is now the time to buy FLWS? Find out in our full research report (it’s free for active Edge members).
1-800-FLOWERS (FLWS) Q3 CY2026 highlights:
- Revenue $171.4 million vs S&P analyst consensus of $196.5 million (20.4% year-on-year decline, 12.8% miss)
- Adjusted EPS -$0.78 vs S&P analyst consensus of -$0.57 (36% miss)
- Adjusted EBITDA -$31.91 million (-18.6% margin, 3.2% year-on-year growth)
- EBITDA guidance $12.5 million at the midpoint for the full year, below analyst estimates of $14.1 million
- Operating margin -27.1%, down from -22.4% in the same quarter last year
- Market capitalization $165.3 million
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our top 5 analyst questions from 1-800-FLOWERS’s Q3 earnings call
- Jacob Mutchler (Noble Capital): Asked about profitability improvements in the wholesale segment and if practices could be applied elsewhere. CFO James Langrock attributed the gains to customer and product mix changes, with timing of shipments influencing results.
- Jacob Mutchler (Noble Capital): Questioned the company’s approach to further asset sales and portfolio rightsizing. Langrock confirmed that, in addition to recent divestitures, the company is evaluating additional non-strategic asset sales and capital-raising options.
- Jacob Mutchler (Noble Capital): Inquired about differences in spending between high- and low-income consumers and how this impacts strategy. CEO Adolfo Villagomez stated the company is increasingly focused on higher-income customers, reflected in higher average order values.
- Anthony Lebiedzinski (Sidoti & Company): Sought detail on drivers behind improving order trends for primary brands and if these trends will persist into the holiday season. Villagomez responded that a focus on merchandising, digital, marketing optimization, and new channels is beginning to deliver results, and the company is cautiously optimistic.
- Linda Bolton Weiser (Water Tower Research): Asked about the future for e-commerce flowers versus physical retail and the potential for outsourcing manufacturing. Villagomez sees the need to differentiate the online value proposition and said all options, including outsourcing, are being considered as part of network optimization.
Catalysts in upcoming quarters
Over the coming quarters, our analyst team will be closely tracking (1) the impact of new digital features—such as the AI-powered shopping agent and Harry & David mobile app—on customer engagement and repeat purchases, (2) early results from merchandising and pricing changes on average order value and gross margin, and (3) progress in operational efficiency through network optimization and Lean Six Sigma initiatives. The completion of additional asset sales and broader adoption of direct ship fulfillment will also be key signposts for ongoing transformation.
1-800-FLOWERS currently trades at $2.52, down from $2.85 just before the earnings. Is there an opportunity in the stock? The answer lies in our full research report (it’s free).
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