Build-A-Bear Sticks To Outlook Despite Tariff Pressure, Stock Soars 25%

Build-A-Bear Workshop Inc. BBW shares surged Thursday after the company posted better-than-expected results for the first quarter of fiscal 2025, with revenue rising 11.9% year over year to $128.4 million, surpassing analysts’ expectations of $118.9 million.

The company posted adjusted earnings of $1.17 per share, beating the consensus forecast of 87 cents.

Net retail sales rose 10.9% to $119.6 million. E-commerce demand edged up 0.5%, while franchise and commercial revenue surged 28.3% to $8.8 million.

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Pre-tax income rose 30.6% year over year to $19.6 million, or 15.3% of revenue, driven by higher margins and offset slightly by increased SG&A expenses and lower interest income.

EBITDA rose 26.7% to $23.1 million, representing 18% of total revenue.

Build-A-Bear added 15 global experience locations in the quarter, ending with 604 worldwide. The total includes 369 corporately managed, 148 partner-operated, and 87 franchise locations.

At the end of the first quarter, the company held $44.3 million in cash, up 16% year over year, with no borrowings on its credit facility.

Inventory rose 12.9% to $72.3 million, driven by early purchases of core products. Capital expenditures totaled $2.9 million, compared to $2.4 million a year ago.

Build-A-Bear used $4.2 million to repurchase 108,502 shares and paid a $2.9 million cash dividend. It has $85 million remaining under its $100 million buyback program.

Build-A-Bear reaffirmed its 2025 revenue guidance, projecting mid-single-digit percentage growth. The company now expects pre-tax income between $61 million and $67 million, including current tariff rates.

It continues to anticipate net new unit growth of at least 50 locations, capital expenditures of $20 million to $25 million, and depreciation and amortization of around $16 million.

The guidance reflects current tariffs, labor and medical cost pressures, higher freight costs, and ongoing inflation but does not factor in major changes to tariffs, macroeconomic conditions, or foreign exchange rates.

Price Action: BBW shares are trading higher by 24.3% to $53.16 at last check Thursday.

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