Release Date: July 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Beyond Inc (BYON, Financial) achieved its revenue target for the second quarter and improved its bottom line by approximately 25%.
- The company successfully increased its active customer base and their average order value.
- Beyond Inc (BYON) established new partnerships in the liquidation and closeout sectors, enhancing its business model.
- The relaunch of Overstock has been accretive to the company's overall gross margin.
- The company reduced fixed costs, resulting in a sequential improvement of more than $11 million in adjusted EBITDA.
Negative Points
- Revenue declined by 6% year-over-year in the second quarter.
- Gross margin decreased by 530 basis points compared to the same period last year due to elevated discounting and higher carrier costs.
- The company reported an adjusted EBITDA loss of $36 million for the second quarter.
- The macroeconomic environment and geopolitical factors are creating challenges for consumer demand.
- The company is not satisfied with its current ad spend as a percentage of revenue, indicating room for improvement in marketing efficiency.
Q & A Highlights
Q: Marcus, it sounds like you're talking about an 18-month timeframe for profitability. Is that a fair timeframe for achieving a neutral EBITDA margin profile?
A: Marcus Lemonis, Executive Chairman of the Board: It better be long before 12 to 18 months. We expect to achieve profitability at some point in 2025. This is how we're building our plan and managing our business.
Q: Can you talk about your capital allocation priorities, especially regarding monetizing non-performing assets like selling the headquarters or anything related to Medici Ventures?
A: Marcus Lemonis, Executive Chairman of the Board: We are focused on being an asset-light business. We've entered into an LOI to reduce debt and potentially bring in cash flow. We're also increasing communication with companies in our investment portfolio to maximize results.
Q: How did the philosophy of using Q2 as a test period play out, and what's the strategy for Q3?
A: Marcus Lemonis, Executive Chairman of the Board: We focused on improving profitability rather than chasing revenue. We saw progress in fixed expenses and gross margin improvement. For Q3, we aim to outperform historical trends, improve margins, and enhance EBITDA.
Q: Can you provide more color on active customers and how growth should be expected going forward?
A: Marcus Lemonis, Executive Chairman of the Board: Most of the customer file growth in Q2 was from Bed Bath & Beyond. We are reengaging Overstock customers and will spend strategically to grow the customer base while focusing on profitability.
Q: What are your goals for the upcoming Partner Summit regarding vendor strategy and reengagement?
A: David Nielsen, President: We aim to make our relationships with key partners more strategic and aligned, focusing on improving customer experience and shopping experience while enhancing margins through deeper supplier relationships.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
