Tandy Leather Factory has reported its financial results for the fourth quarter and full year 2025, headlined by a return to revenue growth and a significant jump in net income driven largely by the sale of its corporate headquarters.
Full year revenues reached $76.3 million, up 2.6% from $74.4 million in 2024. Gross margins improved to 57.0% from 56.2% the prior year, reflecting gains from dynamic sourcing strategies and selective price increases.
Net income came in at $9.1 million, a substantial increase from $0.8 million in 2024, though the figure includes proceeds from the January 2025 sale of the company’s Fort Worth headquarters facility.
Fourth quarter results were also encouraging, with sales of $22.2 million compared to $20.5 million in the same period a year ago and gross profit rising to $12.1 million from $10.8 million.
On the cost side, operating expenses rose to $44.5 million, up 8.1% YOY, primarily due to the transition from owning to leasing its headquarters and distribution center following the property sale.
Employee bonuses tied to exceeding sales and profitability targets, which were expensed entirely in Q4, also contributed to the increase.
CEO Johan Hedberg noted that had those bonuses been spread across the full year, fourth-quarter operating income would have been positive. “We were pleased to return to sales growth for both the fourth quarter and full year 2025,” Hedberg said, adding that the company feels well positioned to focus on continued sales growth and a return to operating profitability in 2026.
The company ended the year with $16.1 million in cash and equivalents, up from $13.3 million at the end of 2024, after paying a special dividend of approximately $12.7 million to stockholders in Q1. A further special dividend of $0.75 per share was paid to shareholders this week.
Inventory stood at $33.2 million, down from $35.6 million at year end 2024.
Adjusted EBITDA from operations, which strips out the headquarters sale and related one-time items, was $0.6 million for the year.
Tandy also recently opened its relocated flagship store in Fort Worth following the move to new offices and a new distribution center.
