National Vision raises FY2025 revenue outlook to up to $1.99B amid strong comp growth and premium product momentum

Earnings Call Insights: National Vision Holdings, Inc. (EYE) Q3 2025

MANAGEMENT VIEW

* CEO Alex Wilkes highlighted National Vision's transformation momentum, stating, "The third quarter marks our 11th consecutive quarter of positive comp store sales with adjusted comp growth reaching 7.7% compared to the prior year." Wilkes emphasized margin expansion, premium product traction, and intentional evolution toward higher-value customer segments, noting, "Our managed care business continues to be very strong, approaching low teens comp sales growth in the quarter with both positive transaction and ticket trends."
* Premium frames, including new brands like Lam, Ted Baker, Jimmy Choo, and HUGO Boss, have "turned faster than our expectations." Wilkes reported strong adoption among cash pay customers, saying, "The better product, the cash pay customer is also opting in to the premium brands we are now offering."
* Wilkes described the pilot of Meta-enabled smart glasses as successful, with plans to expand to an additional 250 locations in Q4. He also detailed pricing modernization, stating, "We're moving from $89.95 to a clean and simple $95 price point for our lead offer."
* The company's new CRM platform and "Every Eye Deserves Better" campaign for America's Best were credited with a significant increase in unaided brand awareness and higher customer engagement.
* CFO Christopher Laden stated, "Net revenue increased 7.9%, driven by adjusted comparable store sales growth of 7.7% and growth from new store sales... Adjusted comparable store sales growth in the period was driven by an increase in average ticket of 7.1%." Laden added, "Adjusted operating income was $19.8 million compared to $14.3 million in the prior year period. Adjusted EPS increased to $0.13 per share in the third quarter of 2025 from $0.12 per share a year ago."

OUTLOOK

* Laden raised full-year 2025 expectations: "We now expect revenue of $1.97 billion to $1.99 billion, adjusted comparable store sales growth of 5% to 6%, adjusted operating income of $92 million to $98 million and adjusted EPS of $0.63 to $0.71." This outlook factors in a 53rd week, estimated to add approximately $35 million of net revenue and $3 million of adjusted operating income.
* Wilkes confirmed ongoing pricing actions: "In the fourth quarter, we're taking our next set of pricing actions on lenses, lens add-ons and our bundle offer." Management expects gross margin to expand slightly for fiscal 2025 and cited continued cost optimization to help offset healthcare expense headwinds.

FINANCIAL RESULTS

* Net revenue rose 7.9% year-over-year, with comparable store sales up 7.7% and average ticket increasing 7.1%.
* Adjusted operating income was $19.8 million and adjusted EPS was $0.13 per share for Q3 2025. Gross margin improved by 40 basis points due to higher average ticket and leveraging optometrist-related costs.
* Operating cash flow year-to-date stood at $133.1 million with $56 million in cash at period end. The company repaid $15 million of revolving credit facility borrowings during the quarter, bringing the balance to zero. Total debt outstanding at the end of Q3 was $253.4 million.

Q&A

* Michael Lasser, UBS: Asked about signals to avoid going too far with merchandising changes and traffic inflection expectations. Wilkes responded, "We're monitoring NPS. We're monitoring conversion rate from exam to purchase to ensure that we're not pushing too far... inventory turns of our higher value frames that we've just introduced, actually exceed our expectations."
* Simeon Gutman, Morgan Stanley: Inquired about pricing changes for 2026 and ticket lift sustainability. Wilkes explained, "We believe that our pricing actions will yield around the same contribution in '26 as they've yielded in '25."
* Robert Ohmes, BofA: Sought market share color. Wilkes said, "We actually do believe we're getting share on a volume basis as well... we have been outstripping that through kind of year-to-date."
* Paul Lejuez, Citi: Asked about competitive pricing and regional differences. Wilkes stated category pricing is "generally growing on price versus on exam growth or customer count growth," and regional price discrepancies are minimal.
* Matt Koranda, ROTH Capital: Probed lens pricing actions. Wilkes indicated, "This is going to be an era of much more surgical increases... we're taking some price changes on some coatings... in light of some planned reimbursement rates."
* Dylan Carden, William Blair: Queried doctor coverage and Meta glasses. Wilkes replied, "We've seen great performance with Meta in the first 50 pilot locations that we rolled out. Again, exceeding our expectations."

SENTIMENT ANALYSIS

* Analysts questioned the sustainability of pricing actions, traffic trends, and competitive positioning, showing a neutral to slightly positive sentiment, pressing for more detail on growth sources and future outlook.
* Management maintained a confident tone throughout, frequently using phrases like "we are confident" and "we are pleased," especially on transformation progress and premium product adoption. Wilkes acknowledged, "All signs are still pointing to a very, very positive response rate to what we're up to."
* Compared to the previous quarter, both analysts and management maintained a slightly more upbeat tone, with more focus on forward momentum and fewer defensive responses.

QUARTER-OVER-QUARTER COMPARISON

* Guidance for revenue and adjusted operating income was raised from the previous quarter, reflecting improved performance and greater confidence in ongoing initiatives.
* The previous quarter focused on initial rollout of premium assortments and CRM platform, while the current quarter saw evidence of traction and expanded rollouts, particularly for premium frames and Meta-enabled smart glasses.
* Analysts in the current quarter pressed more on the sustainability of pricing and comp growth, and management provided greater context on pricing architecture and customer segmentation.
* Management's tone was more confident, citing measurable operational improvements and growing market share on both dollar and volume basis.

RISKS AND CONCERNS

* Management called out softness in cash pay traffic, noting it remains "a little bit depressed" and that overall traffic is flat, though offset by gains in managed care and high-value segments.
* Ongoing healthcare cost headwinds continue to pressure SG&A, with cost optimization a "hyper focus for the organization."
* Analyst questions highlighted concerns about the broader industry demand environment and the delayed purchase cycle among cash pay customers.

FINAL TAKEAWAY

National Vision management expressed strong confidence in its transformation efforts, citing robust third-quarter results, margin expansion, and momentum in premium product categories. The company raised its full-year guidance, supported by ongoing cost optimization, successful pricing actions, and strategic focus on higher-value customer segments. Management emphasized continued investment in technology, marketing, and assortment evolution as key levers for sustainable growth and long-term shareholder value.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/eye/earnings/transcripts]

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