By Connor Hart

Natuzzi said it will undergo a broad financial and operational restructuring, aiming to stabilize its business as the furniture maker faces weak global demand, trade pressure and other challenges.

Interim Chief Executive Pasquale Natuzzi said Friday that the global furniture market is navigating through one of its most challenging periods in decades, pressured by trade tariffs, geopolitical instability and soft consumer demand across key markets.

"Furthermore, the escalation of the conflict involving the U.S., Iran and Israel this past March has introduced new uncertainties, which may likely lead to further discouraging consumers' demand for semi-durable goods," he added.

To help combat these challenges, Natuzzi is seeking to cut costs in part by optimizing its manufacturing footprint in Italy, restructuring overhead, reviewing its direct retail network, outsourcing select non-core activities and tightening its discretionary spending.

The company, which completed the sale of an asset earlier this year, said it is also evaluating additional divestitures of non-core assets that no longer align with its long-term objectives.

Natuzzi added the company is exploring options to raise additional capital, and that it has yet to reach a deal with its labor unions. He noted that dialogues remain constructive and open, despite having proven to be complex.

The company as a result plans to initiate a negotiated crisis settlement procedure, or an out-of-court restructuring framework designed under Italian law to help companies rebalance financially and operationally, while still maintaining business continuity.

The restructuring came as the furniture maker's loss widened in the fourth quarter and it reported a decline in sales for the year.

For its quarter ended Dec. 31, Natuzzi posted a loss 15.5 million euros ($18 million) on revenue of EUR77.5 million. That compares to a loss of EUR3.9 million on revenue of EUR74.9 million in the same quarter a year earlier.

The company reported a loss of EUR30.6 million in 2025, more than its loss of EUR15.2 million a year earlier. Revenue for the year fell 3.3% to EUR308.2 million.

Write to Connor Hart at connor.hart@wsj.com

(END) Dow Jones Newswires

May 15, 2026 17:25 ET (21:25 GMT)

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