# EDGAR Filing Document

**Accession Number:** 0000723603
**File Stem:** 0001193125-25-314238
**Filing Date:** 2025-12
**Character Count:** 62947
**Document Hash:** eb8832100da56abd35caeb14a457a218
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-25-314238.hdr.sgml**: 20251210

**ACCESSION NUMBER**: 0001193125-25-314238

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 12

**CONFORMED PERIOD OF REPORT**: 20251210

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20251210

**DATE AS OF CHANGE**: 20251210

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** CULP INC
- **CENTRAL INDEX KEY:** 0000723603
- **STANDARD INDUSTRIAL CLASSIFICATION:** BROADWOVEN FABRIC MILLS, COTTON [2211]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 561001967
- **STATE OF INCORPORATION:** NC
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-12597
- **FILM NUMBER:** 251562263

**BUSINESS ADDRESS:**
- **STREET 1:** 410 W. ENGLISH ROAD 5TH FLOOR
- **CITY:** HIGH POINT
- **STATE:** NC
- **ZIP:** 27262
- **BUSINESS PHONE:** 3368895161

**MAIL ADDRESS:**
- **STREET 1:** 410 W. ENGLISH ROAD 5TH FLOOR
- **CITY:** HIGH POINT
- **STATE:** NC
- **ZIP:** 27262

?xml version='1.0' encoding='ASCII'? 8-K

**UNITED STATES SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549**

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## FORM 8-K

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**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934**

**Date of Report (Date of earliest event reported):** December 10, 2025<br>

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Culp, Inc.

**(Exact name of Registrant as Specified in Its Charter)**

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| | | |
|:---|:---|:---|
| North Carolina | 1-12597 | 56-1001967 |
| **(State or Other Jurisdiction<br>of Incorporation)** | **(Commission File Number)** | **(IRS Employer<br>Identification No.)** |
| 410 W. English Rd 5th Floor |  |  |
| High Point**,** North Carolina |  | 27262 |
| **(Address of Principal Executive Offices)** |  | **(Zip Code)** |

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**Registrant's Telephone Number, Including Area Code:** 336 889-5161<br>

**(Former Name or Former Address, if Changed Since Last Report)**

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

**Securities registered pursuant to Section 12(b) of the Act:**

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| | | |
|:---|:---|:---|
| **<br>Title of each class** | **Trading<br>Symbol(s)** | **<br>Name of each exchange on which registered** |
| Common stock, par value $0.05 per share | CULP | The New York Stock Exchange |

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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**This report and the exhibits attached hereto contain "forward-looking statements" within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934). Such statements are inherently subject to risks and uncertainties that may cause actual events and results to differ materially from such statements. Forward-looking statements are statements that include projections, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such statements are often but not always characterized by qualifying words such as "expect," "believe," "will," "may," "should," "could," "potential," "continue," "target," "predict", "seek," "anticipate," "estimate," "intend," "plan," "project," and their derivatives, and include but are not limited to statements about expectations, projections, or trends for our future operations, strategic initiatives and plans, restructuring actions, production levels, new product launches, sales, profit margins, profitability, operating (loss) income, capital expenditures, working capital levels, cost savings (including, without limitation, anticipated cost savings from restructuring actions), income taxes, SG&A or other expenses, pre-tax (loss) income, earnings, cash flow, and other performance or liquidity measures, as well as any statements regarding dividends, share repurchases, liquidity, use of cash and cash requirements, ending cash balances and cash positions, borrowing capacity, investments, potential acquisitions, cash and non-cash restructuring and restructuring-related charges, expenses, and/or credits, net proceeds from restructuring related asset dispositions, future economic or industry trends, public health epidemics, or other future developments. There can be no assurance that we will realize these expectations or meet our guidance, or that these beliefs will prove correct.** 

**Factors that could influence the matters discussed in such statements include the level of housing starts and sales of existing homes, demand for home furnishings products, consumer confidence, trends in disposable income, and general economic conditions. Decreases in these economic indicators could have a negative effect on our business and prospects. Likewise, increases in interest rates, particularly home mortgage rates, and increases in consumer debt or the general rate of inflation, could affect us adversely. Changes in consumer tastes or preferences toward products not produced by us could erode demand for our products. Changes in tariffs or trade policy, including changes in U.S. trade enforcement priorities, or changes in the value of the U.S. dollar versus other currencies, could affect our financial results because a significant portion of our operations are located outside the United States. Also, economic or political instability in international areas could affect our operations or sources of goods in those areas, as well as demand for our products in international markets. The future performance of our business depends in part on our success in conducting and finalizing acquisition negotiations and integrating acquired businesses into our existing operations. The impact of public health epidemics on employees, customers, suppliers, and the global economy, such as the coronavirus pandemic, could also adversely affect our operations and financial performance. In addition, the impact of potential asset impairments, including impairments of property, plant, and equipment, inventory, or intangible assets, as well as the impact of valuation allowances applied against our net deferred income tax assets, could affect our financial results. Increases in freight costs, labor costs, and raw material prices, including increases in market prices for petrochemical products, can also significantly affect the prices we pay for shipping, labor, and raw materials, respectively, and in turn, increase our operating costs and decrease our profitability. Also, our success in diversifying our supply chain with reliable partners to effectively service our global platform could affect our operations and adversely affect our financial results. Finally, the future performance of our business also depends on our ability to successfully restructure our bedding operations and return the segment to profitability as well as successfully integrate our bedding and upholstery divisions, neither of which may meet our expectations. Further information about these factors, as well as other factors that could affect our future operations or financial results and the matters discussed in forward-looking statements, is included in Item 1A "Risk Factors" in our most recent Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission.**

**Many of these factors are macroeconomic in nature and are, therefore, beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from those described in this report and the exhibits attached hereto as anticipated, believed, estimated, expected, intended, planned or projected. The forward-looking statements included in this report and the exhibits attached hereto are made only as of the date of this report. Unless required by United States federal securities laws, we neither intend nor assume any obligation to update these forward-looking statements for any reason after the date of this report to conform these statements to actual results or to changes in our expectations. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. Additional risks and uncertainties that we do not presently know about or that we currently consider to be immaterial may also affect our business operations or financial results.**

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## Item 2.02 Results of Operations and Financial Condition.
On December 10, 2025, we issued a news release to announce our financial results for our second quarter ended November 2, 2025. A copy of the news release is attached hereto as Exhibit 99.1.

The information set forth in this Item 2.02 of this Current Report, and in Exhibit 99.1, is intended to be "furnished" under Item 2.02 of Form 8-K. Such information shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

The news release contains adjusted income statement information for the three-month and six-month periods ended November 2, 2025, and October 27, 2024, which disclose adjusted gross profit and adjusted income (loss) from operations, both of which are non-U.S. GAAP performance measures that eliminate items which are not expected to occur on a recurring or regular basis. For the three-month and six-month periods ended November 2, 2025, these items include restructuring credits, restructuring-related charges, and restructuring expenses associated with the sale of our former mattress fabrics manufacturing facility in Quebec, Canada, segment integration initiatives including the transition of operations within our upholstery segment from leased locations to our owned facility in Stokesdale, North Carolina, and similar items. The company has included this adjusted information in order to show operational performance excluding the effects of items not expected to occur on a recurring or regular basis. Details of these calculations and a reconciliation to information from our U.S. GAAP financial statements are set forth in the news release. Management believes this presentation aids in the comparison of financial results among comparable financial periods. Management uses adjusted income statement information in evaluating the financial performance of our overall operations and business segments. Also, adjusted income statement information is used as a performance measure in our incentive-based executive compensation program. We note, however, that this adjusted income statement information should not be viewed in isolation or as a substitute for income (loss) from operations calculated in accordance with U.S. GAAP.

The news release contains disclosures about our net debt, which is a non-U.S. GAAP liquidity measure that we define as cash and cash equivalents (which we sometimes refer to as "cash") plus investments that are available to fund operations minus the total amount of outstanding borrowings under our lines of credit or other debt instruments. Details of these calculations and a reconciliation to information from our U.S. GAAP financial statements are set forth in the news release. We believe this non-GAAP measure is useful to investors as it provides a way to compare our cash or debt position across periods on a consistent basis, regardless of the impact of financing activities. Net debt should not be viewed in isolation by investors and should not be used as a substitute for GAAP measures of liquidity.

The news release contains disclosures about adjusted free cash flow, a non-U.S. GAAP liquidity measure that we define as net cash (used in) provided by operating activities, less cash capital expenditures and any payments on vendor-financed capital expenditures, plus any proceeds from the sale of property, plant, and equipment, plus proceeds from note receivable, plus proceeds from the sale of investments associated with our rabbi trust, less the purchase of investments associated with our rabbi trust, and plus or minus the effects of foreign currency exchange rate changes on cash and cash equivalents, in each case to the extent any such amount is incurred during the period presented. Details of these calculations and a reconciliation to information from our U.S. GAAP financial statements are set forth in the news release. Management believes the disclosure of adjusted free cash flow provides useful information to investors because it measures our available cash flow for potential debt repayment, stock repurchases, dividends, additions to cash and investments, or other corporate purposes. We note, however, that not all of the company's adjusted free cash flow is available for discretionary spending, as we may have mandatory debt payments and other cash requirements that must be deducted from our cash available for future use. In operating our business, management uses adjusted free cash flow to make decisions about what commitments of cash to make for operations, such as capital expenditures (and possible financing arrangements for these expenditures), purchases of inventory or supplies, SG&A expenditure levels, compensation, and other commitments of cash, while still allowing for adequate cash to meet known future commitments for cash, such as debt repayment, and also for making decisions about dividend payments and share repurchases.

The news release contains disclosures about our adjusted EBITDA, which is a non-U.S. GAAP performance measure that reflects net (loss) income excluding income tax expense (benefit), net interest income, and restructuring expense or credit and restructuring related charges or credits, as well as depreciation and amortization expense, and stock-based compensation expense. Beginning in the quarter ended November 2, 2025, we modified our presentation of adjusted EBITDA to also exclude non-cash foreign exchange impacts. We believe this change enhances investor insight into our operational performance by removing the non-cash impact of changes in foreign currency exchange rates. In order to facilitate comparisons among periods, we have applied this modified definition of adjusted EBITDA to all periods presented in the news release. This measure also excludes other non-recurring charges and credits

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associated with our business, if and to the extent any such amount is incurred during the period presented. Details of these calculations and a reconciliation to information from our U.S. GAAP financial statements are set forth in the news release. We believe presentation of adjusted EBITDA is useful to investors because earnings before interest income and expense, income taxes, depreciation and amortization, and similar performance measures that exclude certain charges from earnings, are often used by investors and financial analysts in evaluating and comparing companies in our industry. We note, however, that such measures are not defined uniformly by various companies, with differing expenses being excluded from net income to calculate these performance measures. For this reason, adjusted EBITDA should not be viewed in isolation by investors and should not be used as a substitute for net income (loss) calculated in accordance with GAAP, nor should it be used for direct comparisons with similarly titled performance measures reported by other companies. Use of adjusted EBITDA as an analytical tool has limitations in that this measure does not reflect all expenses that are necessary to fund and operate our business, including funds required to pay taxes, service our debt, and fund capital expenditures, among others. Management uses adjusted EBITDA to help it analyze the company's earnings and operating performance, by excluding the effects of expenses that depend upon capital structure and debt level, tax provisions, and non-cash items such as depreciation, amortization and stock-based compensation expense that do not require immediate uses of cash.

## Item 9.01 Financial Statements and Exhibits.
**EXHIBIT INDEX**

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| | |
|:---|:---|
| **Exhibit Number** | **Exhibit** |
| 99.1 | [<u>News Release dated December 10, 2025</u>](culp-ex99_1.htm) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

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**SIGNATURES**

**Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.**

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| | |
|:---|:---|
| **CULP, INC.**<br>**(Registrant)** | **CULP, INC.**<br>**(Registrant)** |
| **By:** | **/s/ Kenneth R. Bowling** |
|  | **Chief Financial Officer** |
|  | **(principal financial officer)** |

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**<u>Dated December 10, 2025</u>**

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## Exhibit 99.1

**Exhibit 99.1**

![img29555247_0.jpg](img29555247_0.jpg)

**CULP ANNOUNCES SECOND QUARTER FISCAL 2026 RESULTS** 

***Company Continues to Optimize Global Platform and Enhance Cost Structure***

***Restructured Bedding Business Poised for Continued Improvement as Market Conditions Stabilize***

HIGH POINT, N.C. (December 10, 2025) – Culp, Inc. (NYSE: CULP), a leading provider of fabrics for bedding and upholstery fabrics for residential, commercial, and hospitality furniture and other applications, today reported financial and operating results for its second fiscal quarter ended November 2, 2025.

**Fiscal 2026 Second Quarter Financial Highlights**

&nbsp;&nbsp;&nbsp;&nbsp;▪ Consolidated net sales of $53.2 million, a sequential improvement from first quarter net sales of $50.7 million (which included an extra week) and decline from prior-year period net sales of $55.7 million, with bedding segment sales up both sequentially and year-over-year.

▪ Consolidated gross profit of $5.8 million, or 10.9% of sales, compared to prior-year period gross profit of $6.0 million, or 10.8% of sales.

&nbsp;&nbsp;&nbsp;&nbsp;•Excluding restructuring and related expenses, adjusted consolidated gross profit of $6.7 million, or 12.6% of sales, compared to prior-year period adjusted gross profit of $6.8 million, or 12.1% of sales, with the percentage of sales improvement driven primarily by cost and efficiency gains from restructuring initiatives in the bedding segment (see reconciliation table on page 11).

▪ Selling, general and administrative (SG&A) expense of $8.7 million, or 16.4% of sales, an approximately 7% improvement compared with SG&A expense of $9.4 million, or 16.8% of sales, in the prior-year period.

▪ Loss from operations of $(3.5) million, compared to prior-year period loss from operations of $(5.4) million.

Excluding restructuring and related expenses, adjusted operating loss of $(2.0) million, compared to prior-year period adjusted operating loss of $(2.6) million (see reconciliation table on page 11).<br>

▪ Net loss of $(4.3) million, or $(.34) per diluted share, compared to a net loss of $(5.6) million, or $(.45) per diluted share, in the prior-year period.

Excluding the impacts of restructuring and related expenses, stock-based compensation and non-cash foreign exchange impacts, adjusted EBITDA of negative $(1.0) million, an improvement on lower sales compared to negative $(1.1) million in the prior-year period (see reconciliation table on page 13). <br>

**Executive Commentary**

Iv Culp, President and Chief Executive Officer, commented, "We continue to make aggressive adjustments to our cost structure in this challenging macro demand environment that seems to be acutely affecting housing affordability and, therefore, furniture and mattress purchases. Through our platform optimization, we are also positioning CULP to grow, without the need for additional capacity or investment, when conditions in the home furnishings market ultimately improve. The consolidations of our U.S. distribution and window treatment operations are on track for completion by calendar year-end. Moreover, price adjustments to mitigate baseline tariffs are successfully in place and we are initiating additional surcharges along with strategic purchasing decisions in response to new tariffs on imports from Haiti, Turkey and elsewhere during the quarter. We have long stated that tariffs are manageable for us with our global footprint, but reacting at the pace of government implementation has been challenging.

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

"Additionally, we are moving forward with incremental measures including the reduction of our facility footprint in China that should be completed in the third quarter, and we are identifying further cost reductions through our integration project Blaze within SG&A and other expenses. All told, beginning with the bedding restructuring in fiscal 2025 and continuing through the completion of other ongoing initiatives, we expect to enter fiscal 2027 with the benefit of over $20 million in annualized cost savings and enhancements.

"Our restructured bedding platform has already been extremely impactful, with gross profitability in that business almost tripling year-over-year in the first half of fiscal 2026 and driving over 20% improvement in our consolidated operating results for the quarter despite added cost and complexity from the global trade and tariff situation. Our bedding sales during the quarter increased both sequentially and year-over-year, and we saw encouraging trends within our knit fabric and sewn cover product lines as we continued to win market share in key customer segments. Looking ahead in this business, we anticipate market conditions to remain soft in the near term, but there are some indications that the bedding market is stabilizing. We expect to deliver steady sales performance driven by our growing market position, and we remain well prepared for any eventual uptick in unit activity driven by historical product replacement cycles.

"Conditions in the upholstery market continue to be unsettled, with consumer uncertainty, a weak housing market and tariff volatility still pressuring demand. Despite the difficult environment, we were able to maintain solid gross margins in upholstery and relatively stable sales within our U.S. customer base during the quarter, offset by more challenged revenue conditions within China and other markets. We expect our integration actions and China footprint reduction in the back half of this year to further improve profitability in this business and, much like our restructured bedding business, position it to accelerate when market conditions cycle favorably."

Culp concluded, "We are in the homestretch of a comprehensive, multi-phased transformation of our business designed to generate sustained profitability across industry cycles, and we are committed to making more changes within our business as necessary to adjust to market demand. Thanks to our team's commitment and dedication, we will finish the fiscal year with a fully optimized global platform for bedding and upholstery products that is unique to the home furnishings industry and that we believe will create significant long-term value for shareholders. We will continue to leverage our scale and strengths in product development, supply chain and customer service to gain market share, and our highest priorities remain returning CULP to profitability and effectively managing debt."

**Financial Outlook** 

Due to macroeconomic uncertainty and the fluid global trade and tariff environment, the Company is providing only limited forward guidance. The Company's expectations are based on information available at the time of this press release and reflect certain assumptions by management regarding the Company's business and industry trends, the projected impact of restructuring and integration initiatives, and ongoing market headwinds. The Company's expectations also assume no further meaningful impacts from tariffs and trade negotiations.

▪ The Company expects steady consolidated sales performance throughout the remainder of fiscal 2026, with higher expectations for the bedding segment, given what is anticipated to remain a challenged demand environment for home furnishings.

▪ The Company expects the cost and efficiency benefits of its continuing restructuring and division integration initiatives, along with recent pricing action, to drive improving gross profit and lower SG&A, resulting in continued significant improvement in operating loss and near break-even to positive adjusted EBITDA for the third quarter.

▪ While the Company intends to continue utilizing borrowings as necessary under its domestic and foreign credit facilities during fiscal 2026 to fund working capital needs and growth, as well as integration and efficiency initiatives, it will continue to aggressively manage liquidity and capital expenditures and prioritize free cash flow. Additionally, the $4.7 million balance due from the sale of the Company's facility in Canada is scheduled to be paid during the fourth quarter and the Company currently anticipates that those funds may be received earlier than contractually required.

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**Fiscal 2026 Second Quarter Business Segment Highlights**

Following the integration of the Company's two formerly separate divisions, Culp Home Fashions and Culp Upholstery Fabrics, the Company now refers to its mattress fabric and upholstery fabric businesses as its Bedding and Upholstery segments, respectively. Moreover, the Company now manages SG&A expenses on a consolidated basis following the division integration and, as a result, no longer reports operating performance at the segment level.

***Bedding*** 

&nbsp;&nbsp;&nbsp;&nbsp;▪ Sales in this segment were $30.8 million for the second quarter, up approximately 10% sequentially and over 2% year-over-year.

▪ The restructured cost platform in this segment drove gross profit of $3.1 million, or 10.1% of sales, a 27% improvement from the prior year period's gross profit of $2.4 million, or 8.1% of sales.

***Upholstery*** 

▪ Sales in this segment were $22.4 million for the second quarter, sequentially flat with the first quarter and down approximately 12% year-over-year. The decline stemmed from continuing softness across the global home furnishings market driven by consumer uncertainty and a weak housing market, as well as additional pressure on demand from tariffs.

▪ Gross profit was $3.6 million, or 16.1% of sales, down from $4.3 million, or 16.9% of sales, in the prior year period and driven primarily by lower comparable sales.

**Balance Sheet, Cash Flow, and Liquidity** 

&nbsp;&nbsp;&nbsp;&nbsp;▪ As of November 2, 2025, the Company maintained $10.7 million in total cash and $18.3 million in outstanding debt under its credit facilities. The outstanding debt was primarily incurred to fund worldwide working capital and restructuring activities, as well as to take advantage of availability and borrowing opportunities at current preferred rates in China.

&nbsp;&nbsp;&nbsp;&nbsp;▪ As of November 2, 2025, the Company maintained approximately $28.1 million in liquidity consisting of $10.7 million in cash and $17.4 million in borrowing availability under its domestic credit facility.

&nbsp;&nbsp;&nbsp;&nbsp;▪ Cash flow from operations was negative $(1.2) million for the six months ended November 2, 2025, and primarily driven by operating losses, which compares favorably to negative $(2.6) million in the prior-year period. Adjusted for capital expenditures, proceeds from the sale of property, plant and equipment, notes receivable and other items, free cash flow was generally at break-even (see reconciliation table on page 10), down favorably from negative $(3.4) million in the prior-year period.

&nbsp;&nbsp;&nbsp;&nbsp;▪ Capital expenditures for the first quarter were $218 thousand, down from $1.6 million in the prior year period, as the Company continues to focus on maintenance projects and strategic initiatives with quick payback.

**Conference Call** 

Culp, Inc. will hold a conference call to discuss financial results for the second quarter of its fiscal year 2026 on Thursday, December 11, 2025, at 9:00 a.m. Eastern Time. A live webcast of this call can be accessed on the "Upcoming Events" section on the "Investor Relations" page of the Company's website, www.culp.com. A replay of the webcast will be available for 30 days under the "Past Events" section on the "Investor Relations" page of the Company's website.

**About the Company**

Culp, Inc. is one of the largest marketers of mattress fabrics for bedding and upholstery fabrics for residential, commercial, and hospitality furniture and other applications in North America. The Company markets a variety of

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

fabrics to its global customer base of leading bedding and furniture companies, including fabrics produced at Culp's manufacturing facilities and fabrics sourced through other suppliers. Culp has manufacturing and sourcing capabilities located in the United States, China, Haiti, Turkey, and Vietnam.

**Investor Relations Contact**

Ken Bowling, Executive Vice President, Chief Financial Officer, and Treasurer:

(336) 881-5630

krbowling@culp.com

**Forward Looking Statements**

*This release contains "forward-looking statements" within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934). Such statements are inherently subject to risks and uncertainties that may cause actual events and results to differ materially from such statements. Forward-looking statements are statements that include projections, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such statements are often but not always characterized by qualifying words such as "expect," "believe," "will," "may," "should," "could," "potential," "continue," "target," "predict", "seek," "anticipate," "estimate," "intend," "plan," "project," and their derivatives, and include but are not limited to statements about expectations, projections, or trends for our future operations, strategic initiatives and plans, restructuring and integration actions, production levels, new product launches, sales, profit margins, profitability, operating (loss) income, capital expenditures, working capital levels, cost savings (including, without limitation, anticipated cost savings from restructuring and integration actions), income taxes, SG&A or other expenses, pre-tax (loss) income, earnings, cash flow, and other performance or liquidity measures, as well as any statements regarding dividends, share repurchases, liquidity, use of cash and cash requirements, ending cash balances and cash positions, borrowing capacity, investments, potential acquisitions, cash and non-cash restructuring and restructuring-related charges, expenses, and/or credits, net proceeds from restructuring related asset dispositions, future economic or industry trends, public health epidemics, or other future developments. There can be no assurance that we will realize these expectations or meet our guidance, or that these beliefs will prove correct.*

*Factors that could influence the matters discussed in such statements include the level of housing starts and sales of existing homes, demand for home furnishings products, consumer confidence, trends in disposable income, and general economic conditions. Decreases in these economic indicators could have a negative effect on our business and prospects. Likewise, increases in interest rates, particularly home mortgage rates, and increases in consumer debt or the general rate of inflation, could affect us adversely. Changes in consumer tastes or preferences toward products not produced by us could erode demand for our products. Changes in tariffs or trade policy, including changes in U.S. trade enforcement priorities, or changes in the value of the U.S. dollar versus other currencies, could affect our financial results because a significant portion of our operations are located outside the United States. Also, economic or political instability in international areas could affect our operations or sources of goods in those areas, as well as demand for our products in international markets. The future performance of our business depends in part on our success in conducting and finalizing acquisition negotiations and integrating acquired businesses into our existing operations. The impact of public health epidemics on employees, customers, suppliers, and the global economy, such as the coronavirus pandemic, could also adversely affect our operations and financial performance. In addition, the impact of potential asset impairments, including impairments of property, plant, and equipment, inventory, or intangible assets, as well as the impact of valuation allowances applied against our net deferred income tax assets, could affect our financial results. Increases in freight costs, labor costs, and raw material prices, including increases in market prices for petrochemical products, can also significantly affect the prices we pay for shipping, labor, and raw materials, respectively, and in turn, increase our operating costs and decrease our profitability. Also, our success in diversifying our supply chain with reliable partners to effectively service our global platform could affect our operations and adversely affect our financial results. Finally, the future performance of our business also depends on our ability to successfully restructure our bedding operations and return the segment to profitability as well as successfully integrate our bedding and upholstery segments and realize the expected benefits of that integration effort, which may not meet our expectations. Further information about these factors, as well as other factors that could affect our future operations or financial results and the matters discussed in forward-looking statements, is included in Item 1A "Risk Factors" in our most recent Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission.*

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

*Many of these factors are macroeconomic in nature and are, therefore, beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from those described in this release as anticipated, believed, estimated, expected, intended, planned or projected. The forward-looking statements included in this release are made only as of the date of this report. Unless required by United States federal securities laws, we neither intend nor assume any obligation to update these forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in our expectations. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. Additional risks and uncertainties that we do not presently know about or that we currently consider to be immaterial may also affect our business operations or financial results.* 

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.** 

**CONSOLIDATED STATEMENTS OF NET LOSS**

**FOR THE THREE AND SIX MONTHS ENDED NOVEMBER 2, 2025 AND OCTOBER 27, 2024**

**Unaudited**

**(Amounts in Thousands, Except for Per Share Data)**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** |
|  | Amount | Amount |  | Percent of Sales | Percent of Sales |
|  | **November 2,** | October 27, | % Over | **November 2,** | October 27, |
|  | **2025** | 2024 | (Under) | **2025** | 2024 |
| Net sales | **53202** | 55674 | (4.4)% | **100.0%** | 100.0% |
| Cost of sales | **(47420)** | (49684) | (4.6)% | **89.1%** | 89.2% |
| Gross profit | **5782** | 5990 | (3.5)% | **10.9%** | 10.8% |
| Selling, general and administrative<br> expenses | **(8738)** | (9359) | (6.6)% | **16.4%** | 16.8% |
| Restructuring expense | **(499)** | (2031) | (75.4)% | **0.9%** | 3.6% |
| Loss from operations | **(3455)** | (5400) | (36.0)% | **(6.5) %**<br> | (9.7)% |
| Interest expense | **(199)** | (30) | 563.3% | **0.4%** | 0.1% |
| Interest income | **249** | 244 | 2.0% | **0.5%** | 0.4% |
| Other expense | **(694)** | (508) | 36.6% | **1.3%** | 0.9% |
| Loss before income taxes | **(4099)** | (5694) | (28.0)% | **(7.7) %**<br> | (10.2)% |
| Income tax (expense) benefit (1) | **(207)** | 50 | (514.0)% | **(5.1) %**<br> | 0.9% |
| Net loss | $**(4306)** | $(5644) | (23.7)% | **(8.1) %**<br> | (10.1)% |
| Net loss per share - basic | **(0.34)** | (0.45) | (24.4)% |  |  |
| Net loss per share - diluted | **(0.34)** | (0.45) | (24.4)% |  |  |
| Average shares outstanding-basic | **12629** | 12513 | 0.9% |  |  |
| Average shares outstanding-diluted | **12629** | 12513 | 0.9% |  |  |

---

Notes

(1) Percent of sales column for income tax (expense) benefit is calculated as a percent of loss before income taxes.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** |
|  | Amount | Amount |  |  | Percent of Sales | Percent of Sales |
|  | **November 2,** | October 27, | % Over | % Over | **November 2,** | October 27, |
|  | **2025** | 2024 | (Under) | (Under) | **2025** | 2024 |
| Net sales | **103893** | 112211 |  | (7.4)% | **100.0%** | 100.0% |
| Cost of sales | **(90883)** | (101145) |  | (10.1)% | **87.5%** | 90.1% |
| Gross profit | **13010** | 11066 |  | 17.6% | **12.5%** | 9.9% |
| Selling, general and administrative<br> expenses | **(17858)** | (18655) |  | (4.3)% | **17.2%** | 16.6% |
| Restructuring credit (expense) | **3010** | (4662) | N.M. | N.M.% | **2.9%** | (4.2)% |
| Loss from operations | **(1838)** | (12251) |  | (85.0)% | **(1.8) %**<br> | (10.9)% |
| Interest expense | **(381)** | (58) |  | 556.9% | **0.4%** | 0.1% |
| Interest income | **483** | 507 |  | (4.7)% | **0.5%** | 0.5% |
| Other expense | **(1225)** | (913) |  | 34.2% | **1.2%** | 0.8% |
| Loss before income taxes | **(2961)** | (12715) |  | (76.7)% | **(2.9) %**<br> | (11.3)% |
| Income tax expense (1) | **(1576)** | (190) |  | 729.5% | **(53.2) %**<br> | (1.5)% |
| Net loss | $**(4537)** | $(12905) |  | (64.8)% | **(4.4) %**<br> | (11.5)% |
| Net loss per share - basic | **(0.36)** | (1.03) |  | (65.0)% |  |  |
| Net loss per share - diluted | **(0.36)** | (1.03) |  | (65.0)% |  |  |
| Average shares outstanding-basic | **12598** | 12491 |  | 0.86% |  |  |
| Average shares outstanding-diluted | **12598** | 12491 |  | 0.86% |  |  |

---

Notes

(1) Percent of sales column for income tax expense is calculated as a percent of loss before income taxes.

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**CONSOLIDATED BALANCE SHEETS**

**NOVEMBER 2, 2025, OCTOBER 27, 2024, AND APRIL 27, 2025**

**Unaudited**

**(Amounts in Thousands)**

---

| | | | |
|:---|:---|:---|:---|
|  | **Amounts** | **Amounts** | **Amounts** |
|  | **(Condensed)** | (Condensed) | (Condensed) |
|  | **November 2,** | October 27, | \* April 27, |
|  | **2025** | 2024 | 2025 |
| Current assets |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $**10728** | $10531 | $5629 |
| &nbsp;&nbsp;&nbsp;&nbsp;Short-term investments - rabbi trust | **1415** | 919 | 1325 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net | **20642** | 22330 | 21844 |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventories | **49941** | 45132 | 49309 |
| &nbsp;&nbsp;&nbsp;&nbsp;Short-term notes receivable | **5017** | 522 | 280 |
| &nbsp;&nbsp;&nbsp;&nbsp;Current income taxes receivable | **—** | 979 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Assets held for sale | **124** | 3301 | 2177 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other current assets | **2493** | 3187 | 2970 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | **90360** | 86901 | 83534 |
| Property, plant & equipment, net | **22388** | 26510 | 24836 |
| Right of use assets | **4024** | 4239 | 5908 |
| Intangible assets | **771** | 1688 | 960 |
| Long-term investments - rabbi trust | **5637** | 7105 | 5722 |
| Long-term notes receivable | **1011** | 1324 | 1182 |
| Deferred income taxes | **465** | 559 | 637 |
| Other assets | **593** | 661 | 591 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $**125249** | $128987 | $123370 |
| Current liabilities |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Lines of credit - current | **11257** | 4074 | 8114 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable - trade | **29663** | 32373 | 27323 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable - capital expenditures | **38** | 602 | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating lease liability - current | **1609** | 1108 | 2394 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred compensation - current | **1415** | 919 | 1325 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | **889** | 1129 | 422 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | **5203** | 6196 | 5333 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued restructuring | **283** | 863 | 610 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable - current | **899** | 1165 | 1420 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | **51256** | 48429 | 46964 |
| Line of credit - long-term | **7025** |  | 4600 |
| Operating lease liability - long-term | **1477** | 1958 | 2535 |
| Income taxes payable - long-term | **845** | 1378 | 790 |
| Deferred income taxes | **5395** | 6624 | 5155 |
| Deferred compensation - long-term | **5664** | 6975 | 5686 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | **71662** | 65364 | 65730 |
| Shareholders' equity | **53587** | 63623 | 57640 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders'<br> equity | $**125249** | $128987 | $123370 |
| Shares outstanding | **12663** | 12559 | 12559 |

---

*\* Derived from audited financial statements.*

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**FOR THE SIX MONTHS ENDED NOVEMBER 2, 2025 AND OCTOBER 27, 2024**

**Unaudited**

**(Amounts in Thousands)**

---

| | | |
|:---|:---|:---|
|  | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** |
|  | **Amounts** | **Amounts** |
|  | **November 2,** | October 27, |
|  | **2025** | 2024 |
| Cash flows from operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | $**(4537)** | $(12905) |
| &nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in<br> operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | **2168** | 3077 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash inventory charge (credit) | **976** | (309) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization | **192** | 200 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | **333** | 364 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | **412** | 204 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of equipment | **(4)** | (27) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Realized gain on sale of investments (rabbi trust) | **(3)** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash restructuring (credit) expense | **(3601)** | 2178 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency exchange loss | **518** | 237 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | **1240** | (1162) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | **(1512)** | 117 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets | **494** | 194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets | **104** | 107 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable - trade | **2065** | 6506 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | **467** | (366) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued restructuring | **(328)** | 875 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and deferred compensation | **376** | (738) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes | **(526)** | (1185) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | **(1166)** | (2633) |
| Cash flows from investing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital expenditures | **(218)** | (1578) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from the sale of property, plant and equipment | **979** | 527 |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from notes receivable | **180** | 180 |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from the sale of investments (rabbi trust) | **479** | 462 |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchase of investments (rabbi trust) | **(254)** | (378) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) investing activities | **1166** | (787) |
| Cash flows from financing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from lines of credit | **8049** | 4010 |
| &nbsp;&nbsp;&nbsp;&nbsp;Payments on lines of credit | **(2715)** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Payment of debt issuance costs | **(169)** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock surrendered for withholding taxes payable | **(76)** | (68) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities | **5089** | 3942 |
| Effect of foreign currency exchange rate changes on cash and cash equivalents | **10** | (3) |
| Increase in cash and cash equivalents | **5099** | 519 |
| Cash and cash equivalents at beginning of year | **5629** | 10012 |
| Cash and cash equivalents at end of period | $**10728** | $10531 |

---

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**STATEMENTS OF NET SALES AND GROSS PROFIT BY SEGMENT**

**FOR THE THREE AND SIX MONTHS ENDED NOVEMBER 2, 2025 AND OCTOBER 27, 2024**

**Unaudited**

**(Amounts in Thousands)**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** | **THREE MONTHS ENDED** |
|  | Amounts | Amounts |  | Percent of Total Sales | Percent of Total Sales |
|  | **November 2,** | October 27, | % Over | **November 2,** | October 27, |
| Net Sales by Segment | **2025** | 2024 | (Under) | **2025** | 2024 |
| Bedding | $**30763** | $30074 | 2.3% | **57.8%** | 54.0% |
| Upholstery | **22439** | 25600 | (12.3)% | **42.2%** | 46.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;Net Sales | $**53202** | $55674 | (4.4)% | **100.0%** | 100.0% |
| Gross Profit by Segment |  |  |  | Gross Margin | Gross Margin |
| Bedding | $**3102** | $2444 | 26.9% | **10.1%** | 8.1% |
| Upholstery | **3611** | 4315 | (16.3)% | **16.1%** | 16.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Segment Gross Profit | **6713** | 6759 | (0.7)% | **12.6%** | 12.1% |
| Restructuring Related Charge (1) | **(931)** | (769) | 21.1% | **(1.7)%** | (1.4)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gross Profit | $**5782** | $5990 | (3.5)% | **10.9%** | 10.8% |

---

Notes

(1) See page 11 for details regarding restructuring related charges included in cost of sales and gross profit and a Reconciliation of Selected Income Statement Information to Adjusted Results for the three months ended November 2, 2025 and October 27, 2024.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** |
|  | Amounts | Amounts |  | Percent of Total Sales | Percent of Total Sales |
|  | **November 2,** | October 27, | % Over | **November 2,** | October 27, |
| Net Sales by Segment | **2025** | 2024 | (Under) | **2025** | 2024 |
| Bedding | $**58809** | $58150 | 1.1% | **56.6%** | 51.8% |
| Upholstery | **45084** | 54061 | (16.6)% | **43.4%** | 48.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Net Sales | $**103893** | $112211 | (7.4)% | **100.0%** | 100.0% |
| Gross Profit by Segment |  |  |  | Gross Margin | Gross Margin |
| Bedding | $**6044** | $2118 | 185.4% | **10.3%** | 3.6% |
| Upholstery | **7897** | 9833 | (19.7)% | **17.5%** | 18.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Segment Gross Profit | **13941** | 11951 | 16.7% | **13.4%** | 10.7% |
| Restructuring Related Charge (1) | **(931)** | (885) | 5.2% | **(0.9)%** | (0.8)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross Profit | $**13010** | $11066 | 17.6% | **12.5%** | 9.9% |

---

Notes

(1) See page 12 for details regarding restructuring related charges included in cost of sales and gross profit and a Reconciliation of Selected Income Statement Information to Adjusted Results for the six months November 2, 2025, and October 27, 2024.

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES**

**Unaudited**

**(Amounts in Thousands)**

**RECONCILIATION OF NET (DEBT) CASH**

---

| | | | |
|:---|:---|:---|:---|
|  | **Amounts** | **Amounts** | **Amounts** |
|  | **November 2,** | October 27, | April 27, |
|  | **2025** | 2024 | 2025\* |
| **Cash:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $**10728** | $10531 | $5629 |
| **Debt:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Lines of credit - current | **(11257)** | (4074) | (8114) |
| &nbsp;&nbsp;&nbsp;&nbsp;Line of credit - long-term | **(7025)** |  | (4600) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total debt | $**(18282)** | $(4074) | $(12714) |
| **Net (debt) cash position** | $**(7554)** | $6457 | $(7085) |

---

*\* Derived from audited financial statements*

**RECONCILIATION OF ADJUSTED FREE CASH FLOW**

---

| | | |
|:---|:---|:---|
|  | **SIX MONTHS ENDED** | **SIX MONTHS ENDED** |
|  | **Amounts** | **Amounts** |
|  | **November 2,** | October 27, |
|  | **2025** | 2024 |
| Net cash used in operating activities | $**(1166)** | $(2633) |
| Minus: Capital expenditures | **(218)** | (1578) |
| &nbsp;&nbsp;&nbsp;&nbsp;Free Cash Flow | **(1384)** | (4211) |
| Plus: Proceeds from the sale of building and equipment | **979** | 527 |
| Plus: Proceeds from notes receivable | **180** | 180 |
| Plus: Proceeds from the sale of investments (rabbi trust) | **479** | 462 |
| Minus: Purchase of investments (rabbi trust) | **(254)** | (378) |
| Effects of foreign currency exchange rate changes on cash and cash equivalents | **10** | (3) |
| &nbsp;&nbsp;&nbsp;&nbsp;Adjusted Free Cash Flow | $**10** | $(3423) |

---

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CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (CONTINUED)**

**Unaudited**

**(Amounts in Thousands)**

**RECONCILIATION OF SELECTED INCOME STATEMENT INFORMATION TO ADJUSTED RESULTS**

---

| | | | |
|:---|:---|:---|:---|
|  | **Three months ended November 2, 2025** | **Three months ended November 2, 2025** | **Three months ended November 2, 2025** |
|  | **As Reported** |  | Adjusted Results |
|  | **November 2,** |  | November 2, |
|  | **2025** | Adjustments | 2025 |
| Net sales | $**53202** |  | $53202 |
| Cost of sales (1) | **(47420)** | 931 | (46489) |
| Gross profit | **5782** | 931 | 6713 |
| Selling, general and administrative<br> expenses | **(8738)** |  | (8738) |
| Restructuring expense (2) | **(499)** | 499 |  |
| Loss from operations | $**(3455)** | 1430 | $(2025) |

---

Notes

(1) During the three-month period ended November 2, 2025, restructuring related charges recorded in cost of sales represented losses on the disposal, valuation, and markdowns of inventory related to the consolidation of our North American bedding operations and the consolidation of certain facilities related to transforming our operating model to one integrated Culp branded business to reduce fixed costs.

(2) During the three-month period ended November 2, 2025, restructuring expense mostly represented charges related to transforming our operating model and the consolidation of certain facilities to further reduce fixed costs.

---

| | | | |
|:---|:---|:---|:---|
|  | **Three months ended October 27, 2024** | **Three months ended October 27, 2024** | **Three months ended October 27, 2024** |
|  | **As Reported** |  | Adjusted Results |
|  | **October 27,** |  | October 27, |
|  | **2024** | Adjustments | 2024 |
| Net sales | $**55674** |  | $55674 |
| Cost of sales (1) | **(49684)** | 769 | (48915) |
| Gross profit | **5990** | 769 | 6759 |
| Selling, general and administrative<br> expenses | **(9359)** |  | (9359) |
| Restructuring expense (2) | **(2031)** | 2031 |  |
| Loss from operations | $**(5400)** | 2800 | $(2600) |

---

Notes

(1) During the three-month period ended October 27, 2024, restructuring related charges recorded in cost of sales represented losses on the disposal, valuation, and markdowns of inventory mostly related to the closure of the bedding manufacturing facility in Quebec, Canada.

(2) During the three-month period ended October 27, 2024, restructuring expense mostly represented charges related to the consolidation of our North American bedding manufacturing platform and the closure of the bedding manufacturing facility in Quebec, Canada.

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------

CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (CONTINUED)**

**Unaudited**

**(Amounts in Thousands)**

**RECONCILIATION OF SELECTED INCOME STATEMENT INFORMATION TO ADJUSTED RESULTS**

---

| | | | |
|:---|:---|:---|:---|
|  | **Six months ended November 2, 2025** | **Six months ended November 2, 2025** | **Six months ended November 2, 2025** |
|  | **As Reported** |  | Adjusted Results |
|  | **November 2,** |  | November 2, |
|  | **2025** | Adjustments | 2025 |
| Net sales | $**103893** |  | $103893 |
| Cost of sales (1) | **(90883)** | 931 | (89952) |
| Gross profit | **13010** | 931 | 13941 |
| Selling, general and administrative<br> expenses | **(17858)** |  | (17858) |
| Restructuring credit (2) | **3010** | (3010) |  |
| Loss from operations | $**(1838)** | (2079) | $(3917) |

---

Notes

(1) During the six-month period ended November 2, 2025, restructuring related charges recorded in cost of sales represented losses on the disposal, valuation, and markdowns of inventory related to the consolidation of our North American bedding operations and the consolidation of certain facilities related to transforming our operating model to one integrated Culp branded business to reduce fixed costs.

(2) During the six-month period ended November 2, 2025, restructuring credit mostly represented a gain from the sale of the manufacturing facility located in Quebec, Canada totaling $4.0 million, partially offset by charges related to transforming our operating model and the consolidation of certain facilities to further reduce fixed costs.

---

| | | | |
|:---|:---|:---|:---|
|  | **Six months ended October 27, 2024** | **Six months ended October 27, 2024** | **Six months ended October 27, 2024** |
|  | **As Reported** |  | Adjusted Results |
|  | **October 27,** |  | October 27, |
|  | **2024** | Adjustments | 2024 |
| Net sales | $**112211** |  | $112211 |
| Cost of sales (1) | **(101145)** | 885 | (100260) |
| Gross profit | **11066** | 885 | 11951 |
| Selling, general and administrative<br> expenses | **(18655)** |  | (18655) |
| Restructuring expense (2) | **(4662)** | 4662 |  |
| Loss from operations | $**(12251)** | 5547 | $(6704) |

---

Notes

(1) During the six-month period ended October 27, 2024, restructuring related charges recorded in cost of sales represented losses on the disposal, valuation, and markdowns of inventory mostly related to the closure of the bedding manufacturing facility in Quebec, Canada.

(2) During the six-month period ended October 27, 2024, restructuring expense mostly represented charges related to the consolidation of our North American bedding manufacturing platform and the closure of the bedding manufacturing facility in Quebec, Canada.

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------

CULP Announces Results for Second Quarter Fiscal 2026

December 10, 2025

**CULP, INC.**

**RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (CONTINUED)**

**Unaudited**

**(Amounts in Thousands)**

**RECONCILIATION OF ADJUSTED EBITDA**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Quarter<br>Ended** | **Quarter<br>Ended** | **Quarter<br>Ended** | **Quarter<br>Ended** | **Trailing<br>12 Months** | **Six Months Ended** |
|  | **January 26,** | **April 27,** | **August 3,** | **November 2,** | **November 2,** | **November 2,** |
|  | **2025** | **2025** | **2025** | **2025** | **2025** | **2025** |
| **Net loss** | $**(4126)** | $**(2073)** | $**(231)** | $**(4306)** | $**(10736)** | $**(4537)** |
| **Interest income, net** | **(192)** | **(44)** | **(52)** | **(50)** | **(338)** | **(102)** |
| **Income tax expense (benefit)** | **446** | **(243)** | **1369** | **207** | **1779** | **1576** |
| **Depreciation expense** | **1211** | **1152** | **1111** | **1057** | **4531** | **2168** |
| **Amortization expense** | **101** | **104** | **95** | **97** | **397** | **192** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**EBITDA** | **(2560)** | **(1104)** | **2292** | **(2995)** | **(4367)** | **(703)** |
| **Restructuring expense (credit)** | **1655** | **1422** | **(3509)** | **499** | **67** | **(3010)** |
| **Restructuring related expense** | **624** | **113** | **—** | **931** | **1668** | **931** |
| **Stock based compensation** | **158** | **128** | **156** | **177** | **619** | **333** |
| **Foreign currency exchange (gain) loss (1)** | **(334)** | **(48)** | **122** | **396** | **136** | **518** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Adjusted EBITDA** | $**(457)** | $**511** | $**(939)** | $**(992)** | $**(1877)** | $**(1931)** |
| **% Net Sales** | **(0.9)%** | **1.0%** | **(1.9)%** | **(1.9)%** | **(0.9)%** | **(1.9)%** |
|  | **Quarter<br>Ended** | **Quarter<br>Ended** | **Quarter<br>Ended** | **Quarter<br>Ended** | **Trailing<br>12 Months** | **Six Months Ended** |
|  | **January 28,** | **April 28,** | **July 28,** | **October 27,** | **October 27,** | **October 27,** |
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
| **Net loss** | $**(3188)** | $**(4865)** | $**(7261)** | $**(5644)** | $**(20958)** | $**(12905)** |
| **Interest income, net** | **(284)** | **(252)** | **(235)** | **(214)** | **(985)** | **(449)** |
| **Income tax expense (benefit)** | **1027** | **805** | **240** | **(50)** | **2022** | **190** |
| **Depreciation expense** | **1646** | **1623** | **1581** | **1496** | **6346** | **3077** |
| **Amortization expense** | **98** | **99** | **99** | **101** | **397** | **200** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**EBITDA** | **(701)** | **(2590)** | **(5576)** | **(4311)** | **(13178)** | **(9887)** |
| **Restructuring (credit) expense** | **(50)** | **204** | **2631** | **2031** | **4816** | **4662** |
| **Restructuring related (credit) expense** | **(61)** | **—** | **116** | **769** | **824** | **885** |
| **Stock based compensation** | **262** | **168** | **176** | **188** | **794** | **364** |
| **Foreign currency exchange loss (gain) (1)** | **350** | **(246)** | **45** | **192** | **341** | **237** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Adjusted EBITDA** | $**(200)** | $**(2464)** | $**(2608)** | $**(1131)** | $**(6403)** | $**(3739)** |
| **% Net Sales** | **(0.3)%** | **(5.0)%** | **(4.6)%** | **(2.0)%** | **(2.9)%** | **(3.3)%** |
| **% Over (Under)** | **128.5%** | **(120.7)%** | **(64.0)%** | **(12.3)%** | **(70.7)%** | **(48.4)%** |

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Notes

(1) Represents non-cash foreign currency exchange (gain) loss related to the remeasurement of assets and liabilities denominated in currencies other than the U.S. dollar. Beginning in the quarter ended November 2, 2025, we modified our presentation of adjusted EBITDA to exclude this measure. We believe this change enhances investor insight into our operational performance by removing the non-cash impact of changes in foreign currency exchange rates. In order to facilitate comparisons among periods, we have applied this modified definition of Adjusted EBITDA to all periods presented.

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