Ethan Allen cut its workforce 5.7% over the past year amid weaker demand, reduced government business and tariff-related cost pressures.
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A Danbury-based furniture maker reported a 5.7% decline in its workforce over the past year as it navigates a tougher sales environment marked by weaker demand, reduced government business and tariff-related cost pressures.
Ethan Allen Interiors Inc.this week reported net sales of $135.8 million for its fiscal third quarter ended March 31, down from $142.7 million a year earlier, while net income fell to $5.9 million from $9.6 million, according to results released this week.
The company said it ended the quarter with 3,105 employees, 5.7% fewer than a year earlier.
Company leaders pointed to a sluggish home furnishings market shaped by macroeconomic uncertainty, weather disruptions and declining international demand. Wholesale orders dropped 7.6% year over year, while retail orders were flat.
The company also cited reduced business with the U.S. State Department as a factor in the decline.
Tariffs remain another headwind. Ethan Allen said its adjusted operating margin fell to about 5% from 8% a year earlier, reflecting the impact of import duties, partially offset by cost controls and operational efficiencies.
The company noted ongoing shifts in federal trade policy, including the invalidation of certain tariffs by the U.S. Supreme Court and the implementation of a new 10% global import tariff, which it continues to monitor.
Despite softer demand, Ethan Allen emphasized its financial position. The company ended the quarter debt-free with $180.9 million in cash and investments and generated $15.1 million in operating cash flow, up from $10.2 million a year earlier.
At the same time, Ethan Allen plans to open new design centers this year, including locations in California and Florida. The company operates 172 design centers across North America.
Ethan Allen, which makes about 75% of its furniture in North America, said its in-house production helps it manage supply chain and tariff pressures.
