Gross margin fell to 34% from 38.1%, affected by lower sales and the ongoing shift of Natuzzi Editions production for the North American market from China to Italy. The transition temporarily increased labour costs and reduced production efficiency.
By market, North America declined 11.1% to €25.4 million, Greater China fell 4.9% to €6.0 million, and West and South Europe decreased 11.2% to €22.2 million. Emerging Markets were the only bright spot, rising 25.3% to €12.4 million.
The company recorded an operating loss of €2.7 million, compared with a €0.4 million loss in Q2 2024. Net finance costs increased to €3.2 million due to unfavourable currency movements, resulting in a net loss of €5.9 million for the quarter.
Natuzzi invested €4.3 million during the quarter, primarily to upgrade its Italian factories, and ended June with €22.8 million in cash, supported by proceeds from the sale of non-strategic assets—including a property in High Point, North Carolina, and land in Romania.
Outlook
The board approved guidelines for a restructuring plan focused on reducing fixed costs, increasing production flexibility, divesting non-core Italian assets and reviewing the company’s capital structure. The Italian government is considering granting Natuzzi the status of a ‘National Strategic Interest Company’.
Chairman and CEO ad interim Pasquale Natuzzi said the business continues to face “geopolitical instability, a weak U.S. real estate market, a strengthening euro, and still high interest rates,” all of which have dampened consumer demand. He added that U.S. trade tariffs have heightened uncertainty, with dealers reducing inventories rather than placing new orders.
To support liquidity during the transformation, the majority shareholder has provided a credit line of up to €15 million, which may be converted into equity in future capital-strengthening transactions. The company has also begun the search for a new CEO to lead the restructuring and relaunch.
