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Is 1-800-FLOWERS.COM (NASDAQ:FLWS) Weighed On By Its Debt Load?

Simply Wall St · 2d ago

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it seems the smart money knows that debt - which is usually involved in bankruptcies - is a very important factor, when you assess how risky a company is. Importantly, 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS) does carry debt. But the more important question is: how much risk is that debt creating?

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When Is Debt A Problem?

Debt is a tool to help businesses grow, but if a business is incapable of paying off its lenders, then it exists at their mercy. In the worst case scenario, a company can go bankrupt if it cannot pay its creditors. However, a more common (but still painful) scenario is that it has to raise new equity capital at a low price, thus permanently diluting shareholders. Having said that, the most common situation is where a company manages its debt reasonably well - and to its own advantage. When we examine debt levels, we first consider both cash and debt levels, together.

What Is 1-800-FLOWERS.COM's Net Debt?

As you can see below, at the end of September 2025, 1-800-FLOWERS.COM had US$262.9m of debt, up from US$229.8m a year ago. Click the image for more detail. However, it does have US$7.75m in cash offsetting this, leading to net debt of about US$255.2m.

debt-equity-history-analysis
NasdaqGS:FLWS Debt to Equity History December 10th 2025

How Healthy Is 1-800-FLOWERS.COM's Balance Sheet?

According to the last reported balance sheet, 1-800-FLOWERS.COM had liabilities of US$346.4m due within 12 months, and liabilities of US$276.5m due beyond 12 months. Offsetting these obligations, it had cash of US$7.75m as well as receivables valued at US$40.0m due within 12 months. So its liabilities outweigh the sum of its cash and (near-term) receivables by US$575.2m.

The deficiency here weighs heavily on the US$314.5m company itself, as if a child were struggling under the weight of an enormous back-pack full of books, his sports gear, and a trumpet. So we definitely think shareholders need to watch this one closely. After all, 1-800-FLOWERS.COM would likely require a major re-capitalisation if it had to pay its creditors today. The balance sheet is clearly the area to focus on when you are analysing debt. But ultimately the future profitability of the business will decide if 1-800-FLOWERS.COM can strengthen its balance sheet over time. So if you're focused on the future you can check out this free report showing analyst profit forecasts.

See our latest analysis for 1-800-FLOWERS.COM

Over 12 months, 1-800-FLOWERS.COM made a loss at the EBIT level, and saw its revenue drop to US$1.7b, which is a fall of 8.1%. We would much prefer see growth.

Caveat Emptor

Over the last twelve months 1-800-FLOWERS.COM produced an earnings before interest and tax (EBIT) loss. Indeed, it lost a very considerable US$59m at the EBIT level. When we look at that alongside the significant liabilities, we're not particularly confident about the company. It would need to improve its operations quickly for us to be interested in it. Not least because it had negative free cash flow of US$24m over the last twelve months. That means it's on the risky side of things. The balance sheet is clearly the area to focus on when you are analysing debt. However, not all investment risk resides within the balance sheet - far from it. We've identified 2 warning signs with 1-800-FLOWERS.COM (at least 1 which is a bit unpleasant) , and understanding them should be part of your investment process.

If, after all that, you're more interested in a fast growing company with a rock-solid balance sheet, then check out our list of net cash growth stocks without delay.