Purple Innovation (PRPL) AI Stock Analysis

• Market Cap: $125.75M
• Dividend Yield: N/A
• Average Volume (3M): 949.00K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.67
• Revenue Growth: -13.19%
• EPS Growth: 20.95%
• Country: US
• Employees: 1,200
• Sector: Consumer Cyclical
• Sector Strength: 79
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -0.11
• Shares Outstanding: 108,243,940
• 10 Day Avg. Volume: 1,134,405
• 30 Day Avg. Volume: 948,995
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.91
• Enterprise Value/Revenue: 0.53
• Enterprise Value/Gross Profit: 1.42
• Enterprise Value/Ebitda: -6.00
• 1Y Price Target: $1.30
• Price Target Upside: 17.12% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 51 Neutral
• Price Target: $1.00 ▼(-9.91% Downside)

Purple Innovation's overall stock score reflects significant financial challenges, including declining revenues and high leverage. While there are some positive technical indicators and improvements in profitability, the company's valuation remains unattractive due to ongoing losses. The earnings call highlighted both achievements and challenges, contributing to a mixed outlook.

Purple Innovation Business Overview & Revenue Model

Company Description

Purple Innovation, Inc. designs and manufactures mattresses, pillows, and cushions. The company also offers bases, foundations, sheets, mattress protectors, bed frames, seat cushions, weighted blankets, and duvets, as well as pet beds. It markets and sells its products through its e-commerce online channels retail brick-and-mortar wholesale partners, and third-party online retailers, as well as through Purple retail showrooms. The company was founded in 2010 and is headquartered in Lehi, Utah.

How the Company Makes Money

Purple Innovation generates revenue through multiple streams, primarily from the direct sales of their mattresses and bedding products via their e-commerce website. Additionally, they sell through partnerships with major retailers, expanding their reach to a wider customer base. The company employs a direct-to-consumer model that allows for higher margins and lower overhead costs. Purple also engages in targeted marketing campaigns and promotional discounts to drive sales. Furthermore, they have developed a subscription service for some of their products, offering customers convenience and generating recurring revenue. Key partnerships with retailers and a strong online presence contribute significantly to their earnings, as does their focus on customer satisfaction and innovative product design.

Purple Innovation Financial Statement Overview

Summary

Purple Innovation is facing significant financial challenges with declining revenues, persistent losses, high leverage, and reduced equity. Although there are some improvements in cash flow, the company's financial health remains precarious, with potential risks related to liquidity and debt management.

Income Statement

Purple Innovation has faced declining revenues over the past few years, with a significant drop from $724.9 million in 2021 to $487.9 million in 2024. The company has struggled with profitability, evidenced by negative net income and EBIT margins. The gross profit margin has also decreased, indicating challenges in maintaining cost efficiency. Overall, the income statement reflects a company under pressure with declining sales and profitability.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio due to significant liabilities and low stockholders' equity, which has decreased substantially from $145.8 million in 2021 to $20.2 million in 2024. The equity ratio is low, indicating heavy reliance on debt financing. These factors suggest financial instability and potential risks in meeting long-term obligations.

Cash Flow

Purple Innovation's cash flow statement reveals negative free cash flow, although there has been some improvement in operating cash flow compared to previous years. The company has managed to reduce its negative free cash flow from $69.9 million in 2023 to $25.1 million in 2024. However, the reliance on financing activities to support cash flow needs indicates potential liquidity concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	456.84M	487.88M	510.54M	573.20M	725.00M	648.47M
Gross Profit	169.20M	181.13M	171.82M	208.09M	293.75M	305.10M
EBITDA	-40.01M	-45.17M	-94.13M	141.47M	12.77M	-260.98M
Net Income	-84.19M	-97.90M	-120.76M	-92.47M	3.11M	-236.87M
Balance Sheet
Total Assets	303.79M	307.85M	390.63M	433.33M	642.47M	554.73M
Cash, Cash Equivalents and Short-Term Investments	34.25M	29.01M	26.86M	41.75M	91.62M	122.95M
Total Debt	100.92M	158.13M	152.97M	152.96M	184.62M	95.58M
Total Liabilities	319.37M	287.64M	275.02M	254.44M	495.93M	394.48M
Stockholders Equity	-15.64M	20.20M	115.42M	177.96M	145.77M	67.20M
Cash Flow
Free Cash Flow	-26.62M	-25.09M	-69.05M	-66.93M	-87.96M	42.12M
Operating Cash Flow	-19.18M	-17.85M	-54.66M	-28.77M	-30.90M	81.26M
Investing Cash Flow	-7.42M	-7.53M	-16.06M	-34.50M	-57.06M	-39.14M
Financing Cash Flow	37.44M	27.53M	55.83M	13.41M	56.62M	47.36M

Purple Innovation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRPL, the sentiment is Positive. The current price of 1.11 is above the 20-day moving average (MA) of 0.99, above the 50-day MA of 0.85, and above the 200-day MA of 0.85, indicating a bullish trend. The MACD of 0.09 indicates Negative momentum. The RSI at 59.38 is Neutral, neither overbought nor oversold. The STOCH value of 53.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PRPL.

Purple Innovation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ETD	74 Outperform	$760.97M	14.86	10.69%	6.49%	-4.89%	-19.26%
Sector *	61 Neutral	$17.78B	13.97	-5.40%	3.03%	1.50%	-15.71%
BSET	58 Neutral	$148.07M	59.92	1.46%	4.77%	-7.22%	―
SNBR	52 Neutral	$246.84M	―	9.10%	―	-14.40%	-2.14%
PRPL	51 Neutral	$125.75M	―	-331.75%	―	-13.19%	20.95%
HOFT	47 Neutral	$108.84M	―	-5.55%	9.05%	-3.89%	-391.05%
ATER	46 Neutral	$10.18M	―	-42.87%	―	-28.98%	53.51%

Purple Innovation Corporate Events

Purple Innovation Amends Employment and Share Unit Agreements

On August 7, 2025, Purple Innovation, Inc. amended its employment agreement with Robert T. DeMartini to revise the definition of a ‘change in control.’ Additionally, the company’s Board of Directors approved an amendment to the Restricted Share Unit Agreement, ensuring 100% vesting of RSUs upon termination without cause and revising the ‘change in control’ definition. These changes may impact the company’s leadership stability and stakeholder confidence.

Purple Innovation Amends Executive Bonus Arrangements

In July 2025, Purple Innovation, Inc. amended its special bonus arrangements for key executives Robert DeMartini, Todd Vogensen, and Eric Haynor. The amendments stipulate that the bonuses, initially due in August 2025, will be paid in two installments: 35% in August 2025 and 65% in January 2026, contingent upon the executives’ continued service. Additionally, a 15% bonus on the January 2026 payment is offered, with conditions tied to employment continuity or a change in company control. These changes aim to incentivize the executives’ ongoing commitment to the company.

Purple Innovation Approves Executive Incentive Bonuses

On July 17, 2025, Purple Innovation‘s Board of Directors approved long-term incentive cash bonuses for key executives, including Robert DeMartini, Todd Vogensen, and Eric Haynor, with respective amounts of $1,500,000, $450,000, and $393,750. These bonuses are contingent on performance measures such as cumulative net revenue, adjusted EBITDA, and EBITDA margin over a specified period from January 1, 2025, to December 31, 2027. In the event of a company change in control, the bonuses will be determined based on either threshold metrics or actual performance, whichever is greater.

Purple Innovation Stockholders Approve Key Proposals

On June 10, 2025, Purple Innovation‘s stockholders approved several key proposals during their Annual Meeting. These included the election of nine directors, advisory approval of executive compensation, and the ratification of BDO USA, LLP as the independent accounting firm for the fiscal year ending December 31, 2025. These decisions are pivotal for the company’s governance and financial oversight, potentially impacting its strategic direction and stakeholder confidence.