Sales trends and continued cost reductions positioning company for 2024 growth
MIDVALE, Utah, Feb. 20, 2024 (GLOBE NEWSWIRE) -- Beyond, Inc. (NYSE:BYON), owner of Overstock, Bed Bath & Beyond, and other online retail brands designed to unlock your home’s potential, today reported financial results for the quarter and full year ended December 31, 2023.
“Over the last 75 days into my tenure, we have made substantial progress laying the foundation for a high growth, differentiated business model with high customer affinity,” said Marcus Lemonis, Executive Chairman of the Board. “Active customers returned to year-over-year growth for the first time in three years, with over 700,000 customers added to our customer file. Our mandate is to grow our customer file, provide a service level that improves retention and minimizes customer returns. We believe that mandate will result in improved margins and profitability through Beyond.com and our core business. Additionally, as we review our assets and investments, we continue to be optimistic about the value of a few of those investments. As part of that review, we are assessing options related to the portfolio to ensure maximum return for our shareholders. It is our goal to achieve $2 billion of revenue in 2024, and a $3 billion revenue run rate by the end of 2025. This projected revenue improvement, coupled with improved margins and a reduced expense structure provides a clear path to profitability.”
“As a team, we are dissatisfied with the Q4 results and have taken steps to grow revenue, improve margins, and reduce our fixed costs,” said Adrianne Lee, Chief Financial and Administrative Officer. “In December, we announced $25 million of annualized cost reductions. Since that time, we have increased our target to $45 million of annualized expense reduction, freeing up capital to exclusively invest in growth.”
“Planned investments to support the Bed Bath & Beyond brand launch and reignite our customer file are delivering results,” said Dave Nielsen, CEO of Overstock. “We have accelerated customer acquisition during the quarter, driving a vast improvement in our revenue performance. While we spent the back half of the year launching Bed Bath & Beyond, we’ve simultaneously laid the groundwork to reignite Overstock by the end of the first quarter. We believe the combination of these two anchor brands will contribute to achieving our revenue goals.”
“I joined the company because I’m passionate about Bed Bath & Beyond and am driven to reestablish its category dominance,” said Chandra Holt, CEO of Bed Bath & Beyond and its related brands. “We have significant opportunities ahead of us with our robust portfolio of brands. It is my goal to have Bed Bath & Beyond be a leader in unified commerce, win on home-related assortments, and provide unprecedented value for our customers. I look forward to leading the charge in positioning the business for growth and interacting with the investment community.”
Fourth Quarter 2023 Results*
| • | Active customers of 5.6 million, an increase of 9% year-over-year |
| • | Total net revenue of $384 million, a decrease of 5% year-over-year |
| • | Gross profit of $60 million, or 15.6% of total net revenue |
| • | Operating loss of $65 million |
| • | Net loss of $161 million |
| • | Diluted net loss per share of $3.55; Adjusted diluted net loss per share (non-GAAP) of $1.22 |
| • | Adjusted EBITDA (non-GAAP) of ($49) million, which represents (12.7)% of net revenue |
| • | Cash and cash equivalents totaled $303 million at the end of the fourth quarter |
Full Year 2023 Results
| • | Total net revenue of $1.6 billion, a decrease of 19% year-over-year |
| • | Gross profit of $314 million or 20.1% of total net revenue |
| • | Operating loss of $118 million |
| • | Net loss of $308 million |
| • | Diluted net loss per share of $6.81; Adjusted diluted net loss per share (non-GAAP) of $1.95 |
| • | Adjusted EBITDA (non-GAAP) of ($61) million, which represents (3.9)% of net revenue |
*Certain terms, such as active customers, are defined under "Supplemental Operational Data" below.
Earnings Webcast and Replay Information
Beyond will hold a conference call and webcast to discuss its fourth quarter and full year 2023 financial results on Wednesday, February 21, 2024 at 8:30 a.m. ET. To access the live webcast, go to
https://investors.beyond.com. To participate in the conference call via telephone, please register at the link available at https://investors.beyond.com/news-events/events-and-presentations. Registrants will receive dial-in information and a unique PIN to access the live call. Questions may be emailed in advance of the call to ir@beyond.com.
A replay of the conference call will be available at https://investors.beyond.com shortly after the live call has ended.
About Beyond
Beyond, Inc. (NYSE:BYON), based in Midvale, Utah, is an ecommerce expert with a singular focus: connecting consumers with products they love. The Company owns the Bed Bath & Beyond brand and associated intellectual property. Bed Bath & Beyond is an online furniture and home furnishings retailer in the United States and Canada. Its leading ecommerce website sells a broad range of quality, on-trend home products at competitive prices, including furniture, bedding and bath, patio and outdoor, area rugs, tabletop and cookware, décor, storage and organization, small appliances, home improvement, and more. The online shopping site features millions of products that tens of millions of customers visit each month. Beyond regularly posts information about the Company and other related matters on the Newsroom and Investor Relations pages on its website.
Bed Bath & Beyond, Wamsutta, Welcome Rewards, and Overstock.com are registered trademarks of Beyond, Inc. Other service marks, trademarks and trade names which may be referred to herein are the property of their respective owners.
Cautionary Note Regarding Forward-Looking Statements
This press release and the February 21, 2024 conference call and webcast to discuss our financial results may contain forward-looking statements within the meaning of the federal securities laws. Such forward-looking statements include without limitation all statements other than statements of historical fact, including forecasts of our growth, financial results, profitability, expected cost reductions, launch or relaunch of products or brands including Overstock, trends, market conditions, the impact of our national marketing campaign, and any of the timing thereof. You should not place undue reliance on any forward-looking statements, which speak only as of the date they were made. We undertake no obligation to update any forward-looking statements as a result of any new information, future developments, or otherwise. These forward-looking statements are inherently difficult to predict. Actual results could differ materially for a variety of known and unknown risks, uncertainties, and other important factors including but not limited to, difficulties we may have with our fulfillment partners, supply chain, access to products, shipping costs, insurance, competition, macroeconomic changes, attraction/retention of employees, search engine optimization results, and/or payment processors. Other risks and uncertainties include, among others, impacts from changing our company name, stock ticker symbol, or stock exchange, impacts from our use of the Overstock brand and Bed Bath & Beyond brand, our ability to generate positive cash flow, impacts from our evolving business practices and expanded product and service offerings, any problems with our infrastructure, including cyber-attacks or data breaches affecting us, adverse tax, regulatory or legal developments, any restrictions on tracking technologies, any failure to effectively utilize technological advancements or protect our intellectual property, negative economic consequences of global conflict, and whether our partnership with Pelion Venture Partners will achieve its objectives. More information about factors that could potentially affect our financial results are included in our Form 10-K for the year ended December 31, 2022, as updated by our Form 10-Q for the quarter ended September 30, 2023, which were filed with the SEC on February 24, 2023 (as amended on July 3, 2023) and October 31, 2023, respectively, and in our subsequent filings with the SEC. The Forms 10-K, 10-Qs, and our subsequent filings with the SEC identify important factors that could cause our actual results to differ materially from those contained in or contemplated by our projections, estimates and other forward-looking statements.
Contacts
Beyond, Inc. Communications:
Sarah Factor
pr@beyond.com
| Beyond, Inc. Consolidated Balance Sheets (Unaudited) (in thousands, except per share data) | |||||||
| December 31, 2023 | December 31, 2022 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 302,605 | $ | 371,263 | |||
| Restricted cash | 144 | 194 | |||||
| Accounts receivable, net | 19,420 | 17,693 | |||||
| Inventories | 13,040 | 6,526 | |||||
| Prepaids and other current assets | 14,864 | 18,833 | |||||
| Total current assets | 350,073 | 414,509 | |||||
| Property and equipment, net | 27,577 | 27,023 | |||||
| Deferred tax assets, net | 152 | 41,439 | |||||
| Intangible assets, net | 25,254 | 9 | |||||
| Goodwill | 6,160 | 6,160 | |||||
| Equity securities | 155,873 | 296,317 | |||||
| Operating lease right-of-use assets | 3,468 | 7,460 | |||||
| Other long-term assets, net | 12,799 | 2,746 | |||||
| Property and equipment, net held for sale | 54,462 | 82,883 | |||||
| Total assets | $ | 635,818 | $ | 878,546 | |||
| Liabilities and Stockholders' Equity | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 106,070 | $ | 75,130 | |||
| Accrued liabilities | 73,682 | 63,614 | |||||
| Unearned revenue | 49,597 | 44,480 | |||||
| Operating lease liabilities, current | 2,814 | 4,410 | |||||
| Current debt, net held for sale | 232 | 3,508 | |||||
| Total current liabilities | 232,395 | 191,142 | |||||
| Operating lease liabilities, non-current | 940 | 3,626 | |||||
| Other long-term liabilities | 9,107 | 3,476 | |||||
| Long-term debt, net held for sale | 34,244 | 34,476 | |||||
| Total liabilities | 276,686 | 232,720 | |||||
| Stockholders' equity: | |||||||
| Preferred stock, $0.0001 par value, authorized shares - 5,000, issued and outstanding - none | — | — | |||||
| Common stock, $0.0001 par value, authorized shares - 100,000 | |||||||
| Issued shares - 51,770 and 51,102 | |||||||
| Outstanding shares - 45,414 and 44,951 | 5 | 5 | |||||
| Additional paid-in capital | 1,007,649 | 982,718 | |||||
| Accumulated deficit | (481,671 | ) | (173,829 | ) | |||
| Accumulated other comprehensive loss | (506 | ) | (522 | ) | |||
| Treasury stock at cost - 6,356 and 6,151 | (166,345 | ) | (162,546 | ) | |||
| Total stockholders' equity | 359,132 | 645,826 | |||||
| Total liabilities and stockholders' equity | $ | 635,818 | $ | 878,546 | |||
| Beyond, Inc. Consolidated Statements of Operations (Unaudited) (in thousands, except per share data) | |||||||||||||||
| Three months ended December 31, | Year ended December 31, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Net revenue | $ | 384,458 | $ | 404,896 | $ | 1,561,122 | $ | 1,929,334 | |||||||
| Cost of goods sold | 324,497 | 315,341 | 1,247,116 | 1,485,990 | |||||||||||
| Gross profit | 59,961 | 89,555 | 314,006 | 443,344 | |||||||||||
| Operating expenses | |||||||||||||||
| Sales and marketing | 70,716 | 45,504 | 224,547 | 215,477 | |||||||||||
| Technology | 29,662 | 27,999 | 117,154 | 121,158 | |||||||||||
| General and administrative | 24,145 | 18,699 | 90,410 | 79,701 | |||||||||||
| Total operating expenses | 124,523 | 92,202 | 432,111 | 416,336 | |||||||||||
| Operating income (loss) | (64,562 | ) | (2,647 | ) | (118,105 | ) | 27,008 | ||||||||
| Interest income, net | 3,188 | 1,999 | 12,007 | 2,965 | |||||||||||
| Other expense, net | (33,231 | ) | (15,447 | ) | (160,024 | ) | (63,825 | ) | |||||||
| Loss before income taxes | (94,605 | ) | (16,095 | ) | (266,122 | ) | (33,852 | ) | |||||||
| Provision (benefit) for income taxes | 66,388 | (584 | ) | 41,720 | 1,384 | ||||||||||
| Net loss | $ | (160,993 | ) | $ | (15,511 | ) | $ | (307,842 | ) | $ | (35,236 | ) | |||
| Net loss per share of common stock: | |||||||||||||||
| Basic | $ | (3.55 | ) | $ | (0.34 | ) | $ | (6.81 | ) | $ | (0.83 | ) | |||
| Diluted | $ | (3.55 | ) | $ | (0.34 | ) | $ | (6.81 | ) | $ | (0.83 | ) | |||
| Weighted average shares of common stock outstanding: | |||||||||||||||
| Basic | 45,360 | 45,420 | 45,214 | 44,323 | |||||||||||
| Diluted | 45,360 | 45,420 | 45,214 | 44,323 | |||||||||||
| Beyond, Inc. Consolidated Statements of Cash Flows (Unaudited) (in thousands) | |||||||
| Year ended December 31, | |||||||
| 2023 | 2022 | ||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (307,842 | ) | $ | (35,236 | ) | |
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
| Depreciation and amortization | 19,447 | 16,706 | |||||
| Non-cash operating lease cost | 4,737 | 5,304 | |||||
| Stock-based compensation to employees and directors | 23,018 | 18,318 | |||||
| (Increase) decrease in deferred tax assets, net | 41,349 | (1,404 | ) | ||||
| Gain on disposal of cryptocurrencies | (6,361 | ) | — | ||||
| Write-down of assets held for sale | 25,875 | — | |||||
| Loss from equity method securities | 140,404 | 63,923 | |||||
| Other non-cash adjustments | (693 | ) | 185 | ||||
| Changes in operating assets and liabilities: | |||||||
| Accounts receivable, net | (1,727 | ) | 3,805 | ||||
| Inventories | (6,514 | ) | (1,389 | ) | |||
| Prepaids and other current assets | 1,889 | 4,076 | |||||
| Other long-term assets, net | (757 | ) | (1,116 | ) | |||
| Accounts payable | 32,555 | (28,821 | ) | ||||
| Accrued liabilities | 10,442 | (36,625 | ) | ||||
| Unearned revenue | 5,117 | (14,907 | ) | ||||
| Operating lease liabilities | (5,094 | ) | (5,527 | ) | |||
| Other long-term liabilities | 5,569 | 173 | |||||
| Net cash used in operating activities | (18,586 | ) | (12,535 | ) | |||
| Cash flows from investing activities: | |||||||
| Purchase of intangible assets | (25,816 | ) | — | ||||
| Expenditures for property and equipment | (19,181 | ) | (14,899 | ) | |||
| Disbursement for notes receivable | (10,000 | ) | — | ||||
| Purchase of equity securities | — | (18,920 | ) | ||||
| Proceeds from the disposal of cryptocurrencies | 9,804 | — | |||||
| Capital distribution from investment | 4 | 1,224 | |||||
| Other investing activities, net | 559 | (439 | ) | ||||
| Net cash used in investing activities | (44,630 | ) | (33,034 | ) | |||
| Cash flows from financing activities: | |||||||
| Repurchase of shares | — | (80,117 | ) | ||||
| Payments of taxes withheld upon vesting of employee stock awards | (3,799 | ) | (3,700 | ) | |||
| Payments on long-term debt | (3,606 | ) | (3,447 | ) | |||
| Proceeds from employee stock purchase plan | 1,913 | 924 | |||||
| Net cash used in financing activities | (5,492 | ) | (86,340 | ) | |||
| Net decrease in cash, cash equivalents, and restricted cash | (68,708 | ) | (131,909 | ) | |||
| Cash, cash equivalents, and restricted cash, beginning of period | 371,457 | 503,366 | |||||
| Cash, cash equivalents, and restricted cash, end of period | $ | 302,749 | $ | 371,457 | |||
Supplemental Operational Data
We measure our business using operational metrics, in addition to the financial metrics shown above and the non-GAAP financial measures explained below. We believe these metrics provide investors with additional information regarding our financial results and provide key performance indicators to track our progress. These indicators include changes in customer order patterns and the mix of products purchased by our customers.
Active customers represent the total number of unique customers who have made at least one purchase during the prior twelve-month period. This metric captures both the inflow of new customers and the outflow of existing customers who have not made a purchase during the prior twelve-month period.
LTM net revenue per active customer represents total net revenue in a twelve-month period divided by the total number of active customers for the same twelve-month period.
Orders delivered represents the total number of orders delivered in any given period, including orders that may eventually be returned. As we ship a large volume of packages through multiple carriers, actual delivery dates may not always be available, and in those circumstances, we estimate delivery dates based on historical data.
Average order value is defined as total net revenue in any given period divided by the total number of orders delivered in that period.
Orders per active customer is defined as orders delivered in a twelve-month period divided by active customers for the same twelve-month period.
The following table provides our key operating metrics:
(in thousands, except for LTM net revenue per active customer, average order value and orders per active customer)
| Three months ended December 31, | |||||
| 2023 | 2022 | ||||
| Active customers | 5,612 | 5,162 | |||
| LTM net revenue per active customer | $ | 278 | $ | 374 | |
| Orders delivered | 2,549 | 1,882 | |||
| Average order value | $ | 151 | $ | 215 | |
| Orders per active customer | 1.41 | 1.60 | |||
Non-GAAP Financial Measures and Reconciliations
We are providing certain non-GAAP financial measures in this release and related earnings conference call, including adjusted diluted earnings (loss) per share, adjusted EBITDA, and free cash flow. We use these non-GAAP measures internally in analyzing our financial results and we believe they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance in the same manner as our management and board of directors. We have provided reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures in this earnings release. These non-GAAP financial measures should be used in addition to and in conjunction with the results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures.
Adjusted diluted earnings (loss) per share is a non-GAAP financial measure that is calculated as net income (loss) less the income or losses recognized from our equity method securities, net of related tax. We believe that this adjustment to our net income (loss) before calculating per share amounts for the current period presented provides a useful comparison between our operating results from period to period.
Adjusted EBITDA is a non-GAAP financial measure that is calculated as income (loss) before depreciation and amortization, stock-based compensation, interest and other income (expense), provision (benefit) for income taxes, and special items. We believe the exclusion of certain benefits and expenses in calculating adjusted EBITDA facilitates operating performance comparisons on a period-to-period basis. Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring.
Free cash flow is a non-GAAP financial measure that is calculated as net cash provided by or used in operating activities reduced by expenditures for property and equipment. We believe free cash flow is a useful measure to evaluate the cash impact of the operations of the business including purchases of property and equipment which are a necessary component of our ongoing operations.
The following tables reflects the reconciliation of adjusted diluted loss per share to diluted loss per share (in thousands, except per share data):
| Three months ended December 31, | |||||||||||||||||||
| 2023 | |||||||||||||||||||
| Diluted EPS | Less: tax valuation allowance | Less: write- down of assets held for sale | Less: equity method income (loss)1 | Adjusted Diluted EPS | |||||||||||||||
| Numerator: | |||||||||||||||||||
| Net loss attributable to common stockholders | $ | (160,993 | ) | $ | (66,316 | ) | $ | (25,875 | ) | $ | (13,438 | ) | $ | (55,364 | ) | ||||
| Denominator: | |||||||||||||||||||
| Weighted average shares of common stock outstanding—diluted | 45,360 | 45,360 | 45,360 | 45,360 | 45,360 | ||||||||||||||
| Net loss per share of common stock: | |||||||||||||||||||
| Diluted | $ | (3.55 | ) | $ | (1.46 | ) | $ | (0.57 | ) | $ | (0.30 | ) | $ | (1.22 | ) | ||||
1 Inclusive of estimated tax impact
| Year ended December 31, | |||||||||||||||||||
| 2023 | |||||||||||||||||||
| Diluted EPS | Less: tax valuation allowance | Less: write- down of assets held for sale | Less: equity method income (loss)1 | Adjusted Diluted EPS | |||||||||||||||
| Numerator: | |||||||||||||||||||
| Net loss attributable to common stockholders | $ | (307,842 | ) | $ | (66,316 | ) | $ | (25,875 | ) | $ | (127,314 | ) | $ | (88,337 | ) | ||||
| Denominator: | |||||||||||||||||||
| Weighted average shares of common stock outstanding—diluted | 45,214 | 45,214 | 45,214 | 45,214 | 45,214 | ||||||||||||||
| Net loss per share of common stock: | |||||||||||||||||||
| Diluted | $ | (6.81 | ) | $ | (1.47 | ) | $ | (0.57 | ) | $ | (2.82 | ) | $ | (1.95 | ) | ||||
1 Inclusive of estimated tax impact
The following table reflects the reconciliation of adjusted EBITDA to net loss (in thousands):
| Three months ended December 31, | Year ended December 31, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Net loss | $ | (160,993 | ) | $ | (15,511 | ) | $ | (307,842 | ) | $ | (35,236 | ) | |||
| Depreciation and amortization | 4,626 | 4,226 | 19,447 | 16,706 | |||||||||||
| Stock-based compensation | 5,155 | 4,928 | 23,018 | 18,318 | |||||||||||
| Interest income, net | (3,188 | ) | (1,999 | ) | (12,007 | ) | (2,965 | ) | |||||||
| Other expense, net | 33,231 | 15,447 | 160,024 | 63,825 | |||||||||||
| Provision (benefit) for income taxes | 66,388 | (584 | ) | 41,720 | 1,384 | ||||||||||
| Special items (see table below) | 5,769 | — | 14,347 | 1,451 | |||||||||||
| Adjusted EBITDA | $ | (49,012 | ) | $ | 6,507 | $ | (61,293 | ) | $ | 63,483 | |||||
| Special items: | |||||||||||||||
| Brand integration and related costs | $ | 786 | $ | — | $ | 7,120 | $ | — | |||||||
| Restructuring costs1 | 4,983 | — | 7,227 | 878 | |||||||||||
| Special legal charges and other | — | — | — | 573 | |||||||||||
| $ | 5,769 | $ | — | $ | 14,347 | $ | 1,451 | ||||||||
1 Inclusive of certain severance and lease termination costs.
The following table reflects the reconciliation of free cash flow to net cash used in operating activities (in thousands):
| Year ended December 31, | |||||||
| 2023 | 2022 | ||||||
| Net cash used in operating activities | $ | (18,586 | ) | $ | (12,535 | ) | |
| Expenditures for property and equipment | (19,181 | ) | (14,899 | ) | |||
| Free cash flow | $ | (37,767 | ) | $ | (27,434 | ) | |
