NYSE: ETD

We regularly update display presentations and floor plans, strengthen the qualifications of our designers through training and certifications and combine technology with personal service in our design centers. Over the past 10 years, 25% of our design centers are new or have been relocated as we continually evaluate our retail footprint. In the past five years, we have either opened or relocated 17 design centers with an average size of 7,230 square feet. These new design centers reflect our shift to lifestyle centers that better project our brand and optimize space. During fiscal 2026, four new Company-operated design centers were opened that showcase Ethan Allen home furnishings while combining complimentary interior design services with technology.

Business Strategy

Our vertical integration is a competitive advantage for us. Our North American manufacturing and logistics operations are an integral part of an overall strategy to maximize production efficiencies and maintain this competitive advantage. Being vertically integrated across retail, manufacturing and logistics gives us additional flexibility to navigate changing economic conditions while managing quality and service at a high level. We strive to deliver value to our shareholders through the execution of our strategic initiatives focused on the concept of constant reinvention. Ethan Allen has a distinct vision of classic American style with a modern perspective, which we believe differentiates us from our competitors. Our business model is to maintain continued focus on (i) providing relevant product offerings, (ii) capitalizing on the professional and personal service offered to our clients by our interior design professionals, (iii) leveraging the benefits of our vertical integration including a strong manufacturing presence in North America, (iv) regularly investing in new technologies across all aspects of our vertically integrated business, (v) maintaining a strong logistics network, (vi) communicating our messages with strong marketing campaigns, and (vii) utilizing our website, ethanallen.com, as a key marketing tool to drive traffic to our retail design centers.

We aim to position Ethan Allen as a premier interior design destination and a preferred brand offering products of superior style, quality, and value to clients with a comprehensive solution for their home furnishing and interior design needs. We operate our business with an entrepreneurial attitude, staying focused on long-term growth, and treating our employees, vendors, and clients with dignity and respect.

Product

Ethan Allen has kept a disciplined approach to core product assortment. Our focus on maximizing customization and client choice has helped us minimize unnecessary complexity. As a leading interior design destination, our strategy supports personalization and customization, allowing clients and designers to tailor products. We manufacture 75% of the furniture we offer by combining the craftsmanship of our skilled associates with technology in our North American facilities. Every product bears the distinctive quality of the Ethan Allen brand and is sold under the one Ethan Allen brand name. Meticulously hand-guided stitching dresses our upholstery frames and our case goods wood furniture is crafted from premium lumber and veneers, which are individually finished and customized. Our commitment to using leading construction techniques is evident, including using mortise and tenon joinery and four-corner glued dovetail joinery for drawers. These elements are part of Ethan Allen's identity, solidifying our reputation for quality, style and exclusive home furnishings and décor. We exclusively sell Ethan Allen products in our design centers.

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ETHAN ALLEN INTERIORS INC. AND SUBSIDIARIES

Our vertically integrated approach empowers us to introduce new products, oversee design specifications, and uphold consistent levels of excellence across all product lines. Alongside our seven manufacturing facilities in the U.S., we possess three upholstery manufacturing plants in Mexico and a case goods manufacturing facility in Honduras. We selectively outsource the remaining 25% of our products, primarily from Asia. Our sourcing partners must adhere to our quality standards, specifications and social responsibility. If any of these suppliers experience financial or other difficulties, we believe we have alternative sources of supply to prevent temporary disruptions in our imported product flow. We believe our strategic investments in manufacturing facilities and the sourcing from foreign and domestic suppliers position us to accommodate future growth while retaining control over costs, quality and customer service.

Our product assortment has increased in recent years, driven by substantial growth in Home Accents, Lighting, Outdoor, Area Rugs and expanded customization across Upholstery and Case Goods collections. The growth in our product assortment has been driven less by an increase in the number of SKUs, but more by our ability to offer clients significantly more choice through customization. This allows us to create countless variations from a single product while maintaining inventory discipline and operational efficiency.

Projection

Our design centers are interior design destinations, with technology-driven projections and dedicated workstations that foster collaboration between designers and clients. When clients enter, they see a gallery showroom with a certain number of room projections depending on the design center’s square footage. Touchscreens located throughout the sales floor enable clients to browse at their own pace or with a designer’s guidance. In-store presentations often take place at freestanding designer workstations that are equipped with large flat-panel touchscreen displays to share floorplans and 3D renderings. These workstations also provide space for designers to showcase samples. The overall structure of each location equips designers with the tools they need to create personalized presentations for each client, while also giving clients the sense that what they need to realize their design vision is at their fingertips.

During fiscal 2026, new design centers were opened in Colorado Springs, Concord (Canada), San Diego and Vancouver that showcase our ability to combine complimentary interior design services with technology. We ended fiscal 2026 with 171 retail design centers in North America, including 141 Company-operated and 30 independently owned and operated locations, as well as 13 additional design centers outside North America.

Combining Technology with Personal Service

A person who walks into an Ethan Allen design center isn’t met by a salesperson; they’re greeted by an interior designer qualified to solve a range of challenges, from simply recommending a piece of furniture to managing a whole-home redesign. Clients can collaborate with any of our professional designers at our design centers, in their own homes, or via virtual appointment.

Our unique combination of personal service and technology enhances the clients’ Ethan Allen experience, including the use of virtual design appointment capabilities at ethanallen.com. We leverage EA inHome®, an augmented reality mobile app, which empowers clients to preview Ethan Allen products in their homes, at scale, in a wide-variety of fabrics and finishes. With the 3D Room Planner, our designers generate both 2D floor plans and immersive 4K, realistic 3D walk-throughs of the interior designs they create. Clients can view items in 3D, read product details, share, save item lists, and utilize augmented reality views in their homes, either via a QR code on their desktop or directly when browsing on a mobile device. With so much of our product customizable, we encourage our clients to get personalized help from our interior design professionals either in person or through virtual chat. Our state-of-the-art fabric-to-frame configurator empowers designers to visualize over 1,000 fabrics and a wide range of construction options on upholstered frames. This cutting-edge addition to our technology stack offers clients a real-time preview of what their custom upholstery will look like. All of these technologies have been pivotal to our ability to serve clients and provide ways to collaborate and create an exceptional experience.

Marketing

Ethan Allen’s marketing strategy focuses on the promotion of our core brand differentiators: complimentary interior design service, quality and craftsmanship, customization, and premier home delivery. Our brand projection shows two important design perspectives: classic design, modern perspective; and modern design, classic perspective. We convey our messaging across multiple channels, from digital mediums like social media and email campaigns to more traditional channels like direct mail, TV and radio, which help generate interest, drive traffic and reinforce that Ethan Allen is a welcoming and inspirational experience and brand. Our local design centers also engage in grassroots marketing to drive additional interest in our brand.

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ETHAN ALLEN INTERIORS INC. AND SUBSIDIARIES

Omni-Channel Approach

Our integrated omni-channel model supports our interior design led client experience and the execution of our initiatives. By combining design centers with digital engagement, interior design services, exclusive artisan-crafted products, and premier home delivery, our omni-channel model offers purchasing and personalized service at scale. This integrated approach allows product, service and manufacturing channels to reinforce one another, supporting higher client engagement, repeat behavior and durable growth over time. We consider our ethanallen.com website an extension of our retail design centers and not a separate segment of our business. Our website includes enhanced search capabilities, expanded live chat services, online appointment booking and product display pages.

Raw Materials and Supply Chain

The principal raw materials used in our manufacturing include lumber, logs, veneers, plywood, hardware, glue, finishing materials, glass, steel, fabrics, leather, frames, foam and filling material. The various types of wood include soft maple, wormy maple, red oak, garapa, birch, rubber wood, teak and cherry. These raw materials are for cover (primarily fabrics and leather), polyester batting and polyurethane foam for cushioning and padding, lumber and plywood for frames, steel for motion mechanisms and various other metal components for fabrication of products.

Our raw materials are purchased both domestically and outside the U.S. We have no significant long-term supply contracts, do not depend on any one supplier and believe we have sufficient alternate sources of supply to prevent significant long-term disruption to our operations. Appropriate amounts of inventory are typically stocked to maintain adequate production levels. Our diversified sourcing strategy and ability to manufacture approximately 75% of the furniture we sell in our North American facilities leaves us with limited exposure to any one particular country on the remaining 25% of products that are imported. We enter into standard purchase agreements with foreign and domestic suppliers to source selected products. The terms of these arrangements are customary for the industry and do not contain any long-term contractual obligations on our behalf. We believe we maintain good relationships with our suppliers.

Seasonality

We believe that the demand for home furnishings generally reflects sensitivity to overall economic conditions, including consumer confidence, discretionary spending, sales of new and existing homes, interest and inflationary rates, the health of the financial markets, the level of mortgage refinancing, retail trends and unemployment rates. In a typical year, we schedule production to maintain consistent manufacturing activity throughout the year. We typically shut down our manufacturing plants for one week at the beginning of each fiscal year to perform routine maintenance. No individual fiscal quarter contributed more than 26.1% of our annual consolidated net sales during the past three fiscal years, thus limiting our exposure to seasonality.

Segments

We have strategically aligned our business into two reportable segments: wholesale and retail. These two segments represent strategic business areas of our enterprise that operate separately and provide their own distinctive services. We evaluate the performance of our respective segments based upon net sales and operating income. Intersegment transactions result from the wholesale sale of inventory to the retail segment, including the related profit margin. Financial information related to our segments are disclosed in Note 19, Segment Information, of the notes to our consolidated financial statements included under Item 8 of this Annual Report on Form 10-K.

Client Base

Interior designer-led projects typically average higher order values, repeat purchasing behavior and increase visibility into future projects. We sell home furnishings and accents to clients through our 141 Company-operated design centers that make up our retail segment and 43 independently operated design centers located in the U.S., Asia, the Middle East and Europe, which are included within our wholesale segment. This mix is supported by our omni-channel model and service-oriented approach. Our wholesale segment net sales include sales to our retail segment, which are eliminated in consolidation, and sales to our independent retailers and other third parties. No single client represented more than 10% of our consolidated net sales during fiscal 2026. Our ten largest clients were all within our wholesale segment and accounted for 9% of consolidated net sales during fiscal 2026 compared with 11% of consolidated net sales during fiscal 2025. These clients were nine independent retailers and the U.S. government General Services Administration (“GSA”).

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Backlog

We define backlog as any written order received that has not yet been delivered. Our wholesale backlog consists of written orders received from our retail network of independently operated design centers, Company-operated design centers, and contract business clients that have not yet been delivered. Our retail backlog is undelivered written orders associated with retail clients. Our backlog fluctuates based on the timing of net orders booked, manufacturing production, the timing of imported product receipts, the timing and volume of shipments, and the timing of various promotional events. Historically, the size of our backlog varies and may not be indicative of our future sales, and therefore, we do not rely entirely on backlogs to predict future sales. At June 30, 2026 our wholesale backlog was $44.3 million, down 9.3% from a year ago due to a slowdown in orders and improved customer lead times.

Distribution and Logistics

We distribute our products primarily through three national distribution centers, each owned by the Company and strategically located in North Carolina and Virginia. These distribution centers provide effective cross-dock operations to receive and ship Ethan Allen product from our manufacturing facilities and third-party suppliers to our retail network of Company and independently operated retail home delivery centers. Retail home delivery centers prepare products for delivery into clients’ homes. At June 30, 2026, our Company-operated retail design centers were supported by 17 Company-operated retail home delivery centers and four home delivery centers operated by third parties. We utilize independent carriers to ship our products. Our practice has been to sell our products at the same delivered cost to all Company and independently operated design centers throughout the U.S., regardless of their shipping point.

Competition

The home furnishings industry is a highly fragmented and competitive business. There has been increased competition from both digital retailers and those with a brick-and-mortar presence. We compete with numerous individual retail home furnishing stores as well as national and regional chains. We believe we compete primarily on the basis of design, quality, personal service, prompt delivery, product availability and value. We further believe that we are well-positioned to compete on the basis of each of these factors and that, more specifically under our vertical integration structure, our complimentary interior design service, direct manufacturing, a logistics network including white glove delivery service and relevant product offerings, create a competitive advantage. We also believe that we differentiate ourselves further with the caliber of our interior design professionals, who combine personal service with technology.

Intellectual Property

We currently hold trademarks, service marks and copyrights for the Ethan Allen name, logos and designs in a broad range of classes for both products and services in the U.S. and in many foreign countries. We also have registered our slogans utilized in connection with promoting brand awareness, retail sales and certain collection names. In addition, we have registered and maintain the internet domain name of ethanallen.com. We view such trademarks, logos, service marks and domain names as valuable assets and have an ongoing program to diligently monitor and defend, through appropriate action, against their unauthorized use. The Company regularly reviews the necessity for renewal as registrations expire.

Government Contracts

Other than standard provisions contained in our contracts with the U.S. government, we do not believe that any significant portion of our business is subject to material renegotiation of profits or termination of contracts or subcontracts at the election of government entities. Ethan Allen sells to the U.S. government both through GSA Multiple Award Schedule Contracts and through competitive bids. The GSA Multiple Award Schedule Contract pricing is principally based upon our commercial price list in effect when the contract is initiated. We are required to receive GSA approval to apply list price increases during the term of the Multiple Award Schedule Contract period.

Human Capital Management

We operate our business with an entrepreneurial attitude, staying focused on long-term growth, and treating our employees, vendors, and clients with dignity and respect. At June 30, 2026, our employee count totaled 3,062, with 2,137 employees in our wholesale segment and 925 in our retail segment. The majority of our employees are employed on a full-time basis and none of our employees are represented by unions or collective bargaining agreements. In managing our business, we focus on a number of key human capital objectives, which are rooted in our core values and include health and safety, social responsibility and compensation and benefits. We are committed to offering opportunities and retaining talent based on merit, using standards that are free of discrimination and mandates. We believe our relationship with our employees is positive.

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Ethan Allen strives to promote individual initiative, excellence and hard work. We believe our employees have an entrepreneurial spirit, a passion for style, a drive for excellence, and creativity, which has fostered a culture that embraces integrity and innovation. We believe in creating and fostering a workplace in which all our employees feel valued and empowered to do their best work and contribute their ideas and perspectives. Our initiatives include maintaining an environment free from discrimination or harassment of any kind, and continuing to offer opportunities based solely on merit and qualifications. We maintain and enforce our policy prohibiting discrimination and harassment in the workplace.

Ethan Allen is dedicated to upholding ethical standards in all aspects of our business operations as well as adhering to applicable labor norms. The Company’s Code of Conduct provides a clear and thorough ethics standard for all employees, officers, and directors with respect to interactions with clients, vendors and other employees. Ethan Allen provides multiple avenues through which to report inappropriate behavior, including a whistleblower hotline.

Health and Safety

Ethan Allen is committed to protecting the health and safety of our employees. We have safety programs in place for our employees to receive the proper training and education. In addition, we have partnered with local communities in some of our North American manufacturing workshops to provide transportation to and from work and offer daily low-cost meals. In coordination with national healthcare systems for our manufacturing facilities outside of the U.S., we provide on-site medical clinics. We believe this commitment enables us to run our business operations without sacrificing the safety of our employees.

A Culture of Social Responsibility

Throughout our history, philanthropy has been a core value to Ethan Allen. We strive to develop exceptional programs based on partnerships where employees feel a sense of connection and pride in their communities and our mission is to enhance the quality of life in the communities in which we work and live. During fiscal 2026, and for the seventh year in a row, the Mexican Center for Corporate Philanthropy and the Alliance for Corporate Social Responsibility recognized Ethan Allen’s upholstery manufacturing operations in Silao, as “Environmentally and Socially Responsible” for our ongoing commitment to socially responsible management.

Compensation and Benefits

Our compensation programs are designed to attract, retain and motivate team members to achieve strong results. We benchmark our compensation and benefits programs against those of comparable industries and in the geographic areas where our facilities are located. We believe that our compensation and benefits are competitive and allow us to attract and retain skilled labor. Benefits we offer include access to healthcare plans, financial and physical wellness programs, paid time off, parental leave and retirement benefits, including a 401(k) plan with Company-matching contributions.

Talent Development and Career Mobility

We invest in our employees through accessible resources and training programs that help our employees navigate and foster meaningful careers. We offer the opportunity to do meaningful work and learn on the job, supplemented by programs designed to build individual, team and leadership skills. Through these programs, we give our employees the tools to succeed, continue learning and develop their careers while building a strong talent bench to support our future success.

Sustainability

We are committed to sustainable business practices that incorporate social, environmental, health and safety programs into our global manufacturing, distribution, home delivery and retail design centers.

Our environmental initiatives include but are not limited to:

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Use of responsibly harvested Appalachian woods, including maintaining a wood sourcing policy; more than 50% of our wood furniture sold is from materials sourced from certified, recycled or reclaimed wood. During fiscal 2026, Ethan Allen was awarded the designation of “High Score” by The Sustainable Furnishings Council and the National Wildlife Federation for its wood sourcing policies and commitment to sustainable wood

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Use of finishes that are low in both volatile organic compounds and hazardous air pollutants

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Eliminating the use of heavy metals and hydrochlorofluorocarbons in all packaging; our mattresses and custom upholstery use foam made without harmful chemicals and substances

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Conversion, where and when reasonably feasible, to becoming per- and polyfluoroalkyl substances (“PFAS”) free throughout all our products including area rugs, broadloom, draperies and fabrics

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Investment in machinery and technology to cut down the landfill waste we generate by packaging our furniture with custom-sized plastic wrap and cartons to reduce excess packaging waste

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ETHAN ALLEN INTERIORS INC. AND SUBSIDIARIES

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Continual review and investigation of ways to reduce our carbon footprint and greenhouse gas emissions

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Compliance with all required climate risk assessments; during fiscal 2026, Ethan Allen completed its climate-related financial risk report, which summarized the outcome of the climate risk assessment conducted across the Company’s operations in California

The Company requires its sourcing facilities that manufacture Ethan Allen branded products to implement a labor compliance program and meet or exceed the standards established for preventing child labor, involuntary labor, coercion and harassment, discrimination, and restrictions to freedom of association. These facilities are also required to provide a safe environment in all workspaces, compliance with all local wage and hour laws and regulations, compliance with all applicable environmental laws and regulations, and are required to authorize Ethan Allen or its designated agents (including third-party auditing companies) to engage in monitoring activities to confirm compliance.

Regulation and Legislation

We are subject to numerous regulations, including labor and employment laws, customs and trade laws, consumer protection, privacy, safety, real estate, environmental and zoning and occupancy laws, and other laws and regulations that regulate retailers and govern the promotion and sale of merchandise and the operation of our design centers, manufacturing and distribution facilities in the jurisdictions where we source products. We have policies intended to ensure that we conduct business in compliance with applicable laws and regulations. While we cannot predict policy changes by various regulatory agencies or unexpected operational or other developments, we believe we are in material compliance with laws applicable to our business.

Corporate Contact Information

Ethan Allen Interiors Inc. is a Delaware corporation with its principal executive office located in Danbury, Connecticut.

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Founded: 1932

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Incorporated in Delaware: 1989

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Mailing address of the Company’s headquarters: 25 Lake Avenue Ext., Danbury, Connecticut 06811-5286

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Telephone number: +1 (203) 743-8000

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Website address: ethanallen.com

Information about our Executive Officers

Listed below are the names, ages and positions of our current executive officers and, if they had not held those positions for the past five years, their former positions during that period with Ethan Allen or other companies. This information is presented as of September 3, 2026, the date of this Annual Report on Form 10-K.

M. Farooq Kathwari*, age 82

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Chairman of the Board, President and Chief Executive Officer since 1988

Douglas H. Diefenbach, age 72

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Senior Vice President, Real Estate Development since November 2024

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Vice President, Business Development from August 2024 to November 2024

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Vice President, Design Center Development from May 2017 to August 2024

Stephanie K. Durgee, age 40

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Senior Vice President, Merchandising since May 2026

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Vice President, Merchandising from March 2025 to May 2026

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Joined the Company in February 2025 as Senior Director Case Goods

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Prior to joining the Company, held the position of Senior Merchant of N.A. Retail for Design Within Reach® a division of MillerKnoll, Inc. from September 2018 to February 2025

Matthew J. McNulty, age 48

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Senior Vice President, Chief Financial Officer and Treasurer since December 2021

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Vice President, Finance and Treasurer from February 2020 to December 2021

Amy Phillips, age 52

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Executive Vice President, Retail Division since August 2024

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Executive Vice President, Retail Network and Business Development from December 2021 to August 2024

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Senior Vice President, Retail from March 2021 to December 2021

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Mr. Kathwari is the sole executive officer of the Company who operates under a written employment agreement.

Available Information

Information contained in our Investor Relations section of our website at https://ir.ethanallen.com is not part of this Annual Report on Form 10-K. Information that we furnish or file with the SEC, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K or exhibits included in these reports are available for download, free of charge, on our Investor Relations website soon after such reports are filed with or furnished to the SEC. Our SEC filings, including exhibits filed therewith, are also available free of charge through the SEC’s website at www.sec.gov.

The charters for our Board of Directors’ Audit Committee, Compensation Committee, and Corporate Governance, Nominations and Sustainability Committee, as well as our Code of Business Conduct and Ethics, Corporate Governance Guidelines, Insider Trading Policy, Policy Governing the Recovery of Erroneously Awarded Compensation and Foreign Corrupt Practices Act Policy are all available on our website.

Additionally, we broadcast live our quarterly earnings calls via the News & Events section of our Investor Relations website. We also provide notifications of news or announcements regarding our financial performance, including SEC filings, press and earnings releases, and investor events as part of our Investor Relations website. The contents of this website are not intended to be incorporated by reference into this Annual Report on Form 10-K or in any other report or document the Company files with the SEC and any reference to this section of our website is intended to be inactive textual references only.

Additional Information

Additional information with respect to the Company’s business is included within the following pages and is incorporated herein by reference:

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Management’s Discussion and Analysis of Financial Condition and Results of Operations

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Quantitative and Qualitative Disclosures about Market Risk

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Note 1 to Consolidated Financial Statements entitled Organization and Nature of Business

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Note 19 to Consolidated Financial Statements entitled Segment Information

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