Summary of BARK (BARK) FY Conference Call - August 12, 2025 Company Overview - BARK has significantly improved its financial health over the past three years, transitioning from an adjusted EBITDA loss of $58 million in fiscal 2022 to a positive adjusted EBITDA of $5 million in fiscal 2025 [3][4] - Direct-to-consumer (DTC) sales account for 85% of revenues, with over 700,000 pet households served and approximately 1 million boxes shipped monthly [4][5] Core Business Insights - BARK has a strong data-driven approach, utilizing first-party data to refine products and enhance customer feedback mechanisms [5] - The company has diversified its revenue streams, with a focus on consumables and commerce, which now represents 15% of the business and grew by 27% last year [5][6] Strategic Initiatives - BARK launched "Bark Air," generating over $2 million in revenue in its first quarter, with expectations to double this revenue [7] - Transitioned to Shopify for a unified shopping experience, enhancing cross-selling opportunities and reducing payment friction [8][30] - A new consumables line, "Bark in the Belly," is set to launch in August 2025, aiming for broader distribution by the end of the year [9][43] Revenue Diversification and Marketing Strategy - The company plans to dial back marketing support for subscription boxes to maintain positive EBITDA while reallocating funds to consumables and commerce growth [11][12] - The focus is on reducing promotional activities to improve subscriber quality and retention, as promotions attract discount-driven customers who tend to churn quickly [23][24] Tariff and Supply Chain Management - Approximately 70% of BARK's product mix is toys, primarily sourced from China. Tariff increases prompted a shift to diversify manufacturing outside of China, with plans to have all toys manufactured abroad by the end of the fiscal year [13][14] - BARK signed a partnership with Amazon for shipping, which is expected to reduce costs and improve delivery times [16][17] Financial Performance and Projections - The company achieved a record gross margin of 69% in Q1 and expects continued strong performance in commerce, projecting 25% to 30% growth [50][51] - BARK aims to maintain EBITDA positivity and return to top-line growth in fiscal 2027, with a focus on leveraging the consumables launch and improved channel dynamics [49][50] Market Opportunities - The addressable market for consumables is estimated at over $20 billion, compared to $3 billion to $4 billion for toys, indicating significant growth potential [36] - BARK is expanding its presence on e-commerce platforms, including Chewy and Amazon, with plans to explore additional channels like TikTok Shop [41][42] Capital Allocation and Shareholder Value - BARK has repurchased 17 million shares over the past 18 months, with plans to pay down a $44 million convertible note maturing in December [58][59] - The management believes the current share price does not reflect the long-term fundamentals of the business and is open to considering M&A opportunities if attractive offers arise [54][55] Conclusion - BARK is positioned for growth with a healthier financial profile, diversified revenue streams, and a flexible supply chain, aiming for stronger profitability and cash flow generation in the coming years [60][61]

BARK, Inc. (BARK) came out with a quarterly loss of $0.02 per share versus the Zacks Consensus Estimate of a loss of $0.01. This compares to a loss of $0.02 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -100.00%. A quarter ago, it was expected that this company would post earnings of $0.01 per share when it actually produced earnings of $0.01, delivering no surprise.Over the last four quarters, the company has surpassed cons ...

Financial Data and Key Metrics Changes - Total revenue for Q1 2026 was $102.9 million, exceeding guidance of $99 million to $101 million, driven by strong performance in both B2C and Commerce segments [15][23] - Adjusted EBITDA was positive at $100,000, a modest improvement despite external headwinds [20][23] - D2C gross margin reached a record 69.3%, up over 400 basis points year over year [18] Business Line Data and Key Metrics Changes - D2C revenue was $89.2 million, with Bark Air contributing $2.3 million, a 300% increase from last year [5][18] - The Commerce segment generated $13.7 million, a 50% increase year over year, supported by expanded distribution with partners like Amazon and Chewy [17][12] - The product mix shifted, with SuperTure accounting for roughly two-thirds of new subscribers, positively impacting average order value and gross margin [6][16] Market Data and Key Metrics Changes - The retail business saw revenue increase to approximately $14 million, up almost 50% year over year, as the company expanded its retail footprint [12][17] - The company anticipates that Commerce will represent 25% to 30% of revenue in Q2 2026 [22] Company Strategy and Development Direction - The company aims to remain adjusted EBITDA positive while diversifying beyond subscription boxes [4][23] - A new brand platform, Spark, was introduced to deepen emotional connections with customers and enhance brand awareness [8] - The upcoming Bark in the Belly consumables line is expected to unify product offerings and support the company's mission to help dogs in need [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and execution despite ongoing macroeconomic uncertainties and tariff volatility [21][23] - The company is focused on profitable diversified growth and expects to build on Q1 revenue in the coming quarters [13][23] Other Important Information - The company ended the quarter with $85 million in cash, down $9 million from Q4, reflecting inventory build and share repurchases [20] - Marketing expenses were reduced by 25% year over year, allowing for a focus on higher quality customer acquisition [19] Q&A Session Summary Question: What factors influence the EBITDA guidance range for Q2? - Management indicated that timing related to tariffs and operating expenses could affect overall profit performance, leading to a wide guidance range [25][26] Question: What drove stronger subscriber trends in Q1 with low advertising spend? - Management attributed the growth to ongoing experimentation with ad formats and a focus on acquiring higher quality customers, resulting in a shift towards premium offerings [32][33] Question: How should revenue contribution from diversification initiatives be viewed for the back half of the year? - Management expects the Commerce business to represent over 30% of overall revenue within a couple of years, with Bark Air's contribution anticipated to increase to 2-3% of total revenue [34][36]

[PART I. Financial Information](index=4&type=section&id=PART%20I.%20Financial%20Information) [Financial Statements (Unaudited)](index=4&type=section&id=ITEM%201.%20Financial%20Statements%20(Unaudited)) Presents BARK, Inc.'s unaudited condensed consolidated financial statements for Q2 2025, covering balance sheets, operations, cash flows, and notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Highlights (in thousands) | Balance Sheet Item | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | Cash and cash equivalents | $84,665 | $94,022 | | Inventory | $98,124 | $88,126 | | Total Assets | $259,951 | $260,635 | | Total current liabilities | $130,491 | $124,040 | | Total liabilities | $165,982 | $161,109 | | Total stockholders' equity | $93,969 | $99,526 | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Statement of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $102,861 | $116,212 | | Gross Profit | $64,077 | $73,266 | | Total Operating Expenses | $72,430 | $83,858 | | Loss from Operations | $(8,353) | $(10,592) | | Net Loss | $(7,030) | $(10,039) | | Net loss per share | $(0.04) | $(0.06) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(5,440) | $1,792 | | Net cash used in investing activities | $(708) | $(2,043) | | Net cash used in financing activities | $(2,130) | $(4,300) | | Net decrease in cash | $(8,328) | $(4,530) | | Cash, cash equivalents and restricted cash - end of period | $89,203 | $126,174 | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes cover accounting policies, revenue disaggregation, debt, equity, stock compensation, leases, legal contingencies, and segment reporting - The company operates in two reportable segments: Direct to Consumer (DTC) and Commerce, with CODM evaluating segment performance based on gross profit[90](index=90&type=chunk)[92](index=92&type=chunk) Revenue by Segment (in thousands) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Direct to Consumer | $89,176 | $107,059 | | Commerce | $13,685 | $9,153 | | **Total Revenue** | **$102,861** | **$116,212** | - As of June 30, 2025, the company had **$42.9 million** of outstanding borrowings under the 2025 Convertible Notes, maturing on December 1, 2025[54](index=54&type=chunk)[59](index=59&type=chunk) - During the three months ended June 30, 2025, the company repurchased **1.3 million shares** of its common stock for **$1.8 million**, completing its authorized repurchase programs[66](index=66&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2025 financial results, highlighting an 11.5% revenue decrease, improved net loss, segment performance, and liquidity Key Performance Indicators | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total Orders (in thousands) | 2,819 | 3,442 | | Average Order Value | $30.80 | $30.94 | - Direct to Consumer (DTC) revenue decreased by **16.7%** primarily due to an **18.1% decrease in Total Orders**, partially offset by **$2.3 million** in revenue from the new BARK Air initiative[129](index=129&type=chunk) - Commerce revenue grew **49.5%** due to increased sales volume from both new and existing retail customers[130](index=130&type=chunk) Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Line Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Loss | $(7,030) | $(10,039) | | Adjustments (Interest, D&A, Stock Comp, etc.) | $7,118 | $8,243 | | **Adjusted EBITDA** | **$88** | **$(1,796)** | - As of June 30, 2025, the company had cash and cash equivalents of **$84.7 million** and believes this is sufficient to fund operations for at least the next 12 months[153](index=153&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=37&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company discloses minimal exposure to market risks, including interest rate, inflation, and foreign exchange, deeming them immaterial - The company does not anticipate material risks from changes in interest rates, holding **$84.7 million** in cash and cash equivalents with no outstanding borrowings as of June 30, 2025[175](index=175&type=chunk)[176](index=176&type=chunk) - Management does not believe that inflation has had a material effect on the business, financial condition, or results of operations[177](index=177&type=chunk) - Foreign currency translation risk is not expected to have a material impact as the company operates primarily within the United States and transacts mostly in U.S. dollars[178](index=178&type=chunk) [Controls and Procedures](index=37&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective, with no material changes in internal control over financial reporting - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures are effective[179](index=179&type=chunk) - There were no changes in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal controls[179](index=179&type=chunk) [PART II. Other Information](index=38&type=section&id=PART%20II.%20Other%20Information) [Legal Proceedings](index=38&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is involved in a putative class action lawsuit related to its merger, with potential liability unquantifiable - A putative class action complaint, Kenville v. Northern Star Sponsor LLC, et al., is pending against certain former officers and directors of Northern Star Acquisition Corp. and its sponsor[181](index=181&type=chunk) - The claims alleged are for breach of fiduciary duty and unjust enrichment, with the company currently unable to quantify any potential liability from this litigation[181](index=181&type=chunk) [Risk Factors](index=38&type=section&id=ITEM%201A.%20Risk%20Factors) This section details numerous risks, including consumer spending reliance, customer acquisition, supply chain, competition, and cybersecurity - The business depends on consumer discretionary spending, which can be negatively impacted by economic downturns, inflation, and other macroeconomic conditions[195](index=195&type=chunk)[197](index=197&type=chunk) - The company faces challenges in acquiring and retaining customers cost-effectively and depends on digital channels, which are subject to algorithm and policy changes[187](index=187&type=chunk)[188](index=188&type=chunk) - There is a critical reliance on a limited number of suppliers and manufacturers, primarily located in Asia, introducing risks related to trade policies, tariffs, and geopolitical developments[200](index=200&type=chunk)[202](index=202&type=chunk) - The company is subject to risks from online payment methods, reliance on third-party SaaS technologies, and potential compromises of its computer networks and databases containing personal information[210](index=210&type=chunk)[212](index=212&type=chunk)[216](index=216&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities occurred; the company repurchased 1.3 million shares for $1.8 million, completing its program Issuer Purchases of Equity Securities (For the three months ended June 30, 2025) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value that May Yet be Purchased | | :--- | :--- | :--- | :--- | | April 1-30, 2025 | 1,310,627 | $1.35 | $— | | **Total** | **1,310,627** | **$1.35** | **$—** | - The repurchase of **1.3 million shares** for **$1.8 million** in April 2025 completed the company's total authorized stock repurchase program of **$26.5 million**[249](index=249&type=chunk) [Defaults Upon Senior Securities](index=52&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities during the period - None[250](index=250&type=chunk) [Mine Safety Disclosures](index=53&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[251](index=251&type=chunk) [Other Information](index=53&type=section&id=ITEM%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading plans during the reporting period - No directors or officers adopted or terminated any Rule 10b5-1(c) trading plans during the period covered by the report[252](index=252&type=chunk) [Exhibits](index=53&type=section&id=ITEM%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and interactive data files (Inline XBRL) - Exhibits filed with the report include CEO and CFO certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[255](index=255&type=chunk) - The filing also includes Inline XBRL Instance, Schema, Calculation, Definition, Label, and Presentation documents[255](index=255&type=chunk)

[Executive Summary & Q1 FY26 Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Q1%20FY26%20Highlights) BARK achieved positive adjusted EBITDA and advanced diversification in Q1 FY26, exceeding revenue guidance and improving DTC gross margin [CEO Commentary](index=1&type=section&id=CEO%20Commentary) BARK's Co-Founder and CEO, Matt Meeker, reported solid progress in Q1 FY26, successfully maintaining positive adjusted EBITDA and advancing diversification efforts beyond subscription boxes - BARK's two clear priorities for fiscal 2026 are to maintain positive adjusted EBITDA and accelerate diversification beyond subscription boxes[3](index=3&type=chunk) - Revenue came in ahead of guidance, and the company achieved its strongest DTC gross margin quarter to date, driven by a shift toward higher-value Super Chewer customers[3](index=3&type=chunk) - The Commerce segment grew **50% year-over-year**, and BARK Air surpassed **$2 million in revenue**[3](index=3&type=chunk) [Fiscal First Quarter 2026 Key Financial Highlights](index=1&type=section&id=Fiscal%20First%20Quarter%202026%20Key%20Financial%20Highlights) BARK reported Q1 FY26 total revenue of $102.9 million, exceeding guidance despite an 11.5% year-over-year decline, with Commerce revenue surging and Adjusted EBITDA turning positive Q1 FY26 Key Financial Highlights | Metric | Q1 FY26 (Millions) | YoY Change | | :---------------------- | :----------------- | :--------- | | Total Revenue | $102.9 | -11.5% | | Commerce Revenue | $13.7 | +49.5% | | Direct-to-consumer gross margin | 67.0% | +250 bps | | Net Loss | $(7.0) | +$3.0M (improvement) | | Adjusted EBITDA | $0.1 | +$1.9M (improvement) | [Q1 FY26 Detailed Financial Performance](index=1&type=section&id=Q1%20FY26%20Detailed%20Financial%20Performance) This section details BARK's Q1 FY26 financial results, including revenue declines in DTC, strong Commerce growth, improved DTC gross margin, and reduced operating expenses leading to positive Adjusted EBITDA [Revenue Analysis](index=1&type=section&id=Revenue%20Analysis) Total revenue for Q1 FY26 was $102.9 million, an 11.5% decrease year-over-year, primarily due to fewer total orders and a strategic management of marketing spend Q1 FY26 Revenue Breakdown | Revenue Segment | Q1 FY26 (Millions) | YoY Change | Primary Driver/Reason |\ | :-------------------- | :----------------- | :--------- | :-------------------- |\ | Total Revenue | $102.9 | -11.5% | Fewer total orders, focus on profitability |\ | Direct to Consumer | $89.2 | -16.7% | Fewer total orders, marketing spend management |\ | Commerce | $13.7 | +49.5% | Strong growth at Costco, Amazon, Chewy, TJX | [Gross Profit and Margin](index=1&type=section&id=Gross%20Profit%20and%20Margin) Gross profit for Q1 FY26 decreased by 12.5% year-over-year to $64.1 million, primarily influenced by the decline in total revenue, while Direct-to-Consumer gross margin improved by 250 basis points Q1 FY26 Gross Profit and Margin | Metric | Q1 FY26 (Millions) | Q1 FY25 (Millions) | YoY Change | | :---------------------- | :----------------- | :----------------- | :--------- | | Gross Profit | $64.1 | $73.3 | -12.5% | | Consolidated Gross Margin | 62.3% | 63.0% | -0.7% | | DTC Gross Margin | 67.0% | 64.5% | +250 bps | [Operating Expenses](index=2&type=section&id=Operating%20Expenses) Operating expenses saw reductions in Q1 FY26, with advertising and marketing expenses decreasing to $15.2 million and general and administrative expenses also declining year-over-year Q1 FY26 Operating Expenses | Expense Category | Q1 FY26 (Millions) | Q1 FY25 (Millions) | YoY Change | | :------------------------ | :----------------- | :----------------- | :--------- | | Advertising and marketing | $15.2 | $20.4 | -25.5% |\ | General and administrative| $57.3 | $63.4 | -9.6% | [Net Loss and Adjusted EBITDA](index=1&type=section&id=Net%20Loss%20and%20Adjusted%20EBITDA) BARK demonstrated significant improvement in profitability for Q1 FY26, with net loss decreasing by $3.0 million and Adjusted EBITDA turning positive at $0.1 million Q1 FY26 Net Loss and Adjusted EBITDA | Metric | Q1 FY26 (Millions) | Q1 FY25 (Millions) | YoY Change | | :-------------- | :----------------- | :----------------- | :--------- | | Net Loss | $(7.0) | $(10.0) | +$3.0M (improvement) | | Adjusted EBITDA | $0.1 | $(1.8) | +$1.9M (improvement) | [Balance Sheet Highlights](index=2&type=section&id=Balance%20Sheet%20Highlights) BARK's balance sheet as of June 30, 2025, shows cash and equivalents at $84.7 million, increased inventory, stable total assets, and a rise in total liabilities [Key Balances as of June 30, 2025](index=2&type=section&id=Key%20Balances%20as%20of%20June%2030%2C%202025) As of June 30, 2025, BARK's cash and cash equivalents stood at $84.7 million, with inventory increasing to $98.1 million, while total liabilities rose to $166.0 million Balance Sheet Key Figures (June 30, 2025 vs. March 31, 2025) | Metric | June 30, 2025 (Thousands) | March 31, 2025 (Thousands) | Change (QoQ) | | :-------------------------- | :------------------------ | :------------------------- | :----------- | | Cash and cash equivalents | $84,665 | $94,022 | $(9,357) | | Inventory | $98,124 | $88,126 | +$9,998 | | Total Current Assets | $201,687 | $201,637 | +$50 | | Total Assets | $259,951 | $260,635 | $(684) | | Total Current Liabilities | $130,491 | $124,040 | +$6,451 | | Total Liabilities | $165,982 | $161,109 | +$4,873 | | Total Stockholders' Equity | $93,969 | $99,526 | $(5,557) | [Cash Flow Highlights](index=2&type=section&id=Cash%20Flow%20Highlights) BARK's Q1 FY26 cash flow saw net cash used in operating activities, primarily due to increased inventory, resulting in negative free cash flow [Q1 FY26 Cash Flow Summary](index=2&type=section&id=Q1%20FY26%20Cash%20Flow%20Summary) In Q1 FY26, BARK reported net cash used in operating activities of $(5.4) million, a shift from cash provided in the prior year, primarily driven by a $10.0 million net increase in inventory Q1 FY26 Cash Flow Summary | Cash Flow Activity | Q1 FY26 (Millions) | Q1 FY25 (Millions) | | :---------------------------------- | :----------------- | :----------------- | | Net cash (used in) provided by operating activities | $(5.4) | $1.8 | | Capital expenditures | $(0.7) | $(2.0) | | Free Cash Flow | $(6.1) | $(0.3) | | Net cash used in financing activities | $(2.1) | $(4.3) | | Net decrease in cash | $(8.3) | $(4.5) | - The **$10.0 million net increase in inventory** and **$1.8 million of share repurchases** contributed to the cash usage in the quarter[10](index=10&type=chunk) [Q2 FY26 Financial Outlook](index=2&type=section&id=Q2%20FY26%20Financial%20Outlook) BARK projects Q2 FY26 total revenue between $102.0 million and $105.0 million and Adjusted EBITDA between $(2.0) million and $2.0 million, withholding full-year guidance due to tariff uncertainties [Guidance for Fiscal Second Quarter 2026](index=2&type=section&id=Guidance%20for%20Fiscal%20Second%20Quarter%202026) BARK provided its financial outlook for Q2 FY26, projecting total revenue between $102.0 million and $105.0 million, and Adjusted EBITDA in the range of $(2.0) million to $2.0 million Q2 FY26 Financial Guidance | Metric | Q2 FY26 Guidance Range (Millions) | | :-------------- | :------------------------------- | | Total Revenue | $102.0 - $105.0 | | Adjusted EBITDA | $(2.0) - $2.0 | - BARK will not be providing full-year guidance at this time due to ongoing uncertainty surrounding tariffs and their impact on overall demand and operating costs[8](index=8&type=chunk) [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) Details for BARK's Q1 FY26 earnings conference call, held on August 7, 2025, including dial-in numbers and webcast access [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) A conference call to discuss BARK's first quarter fiscal year 2026 results was scheduled for August 7, 2025, at 8:30 a.m. ET, accessible via dial-in or live audio webcast - A conference call to discuss Q1 FY26 results was held on **August 7, 2025, at 8:30 a.m. ET**[12](index=12&type=chunk) - Access details include a U.S. dial-in number (**1-888-596-4144**), international number (**1-646-968-2525**), passcode (**5515653**), and a live audio webcast at **https://investors.bark.co/**[13](index=13&type=chunk) [About BARK](index=3&type=section&id=About%20BARK) BARK, founded in 2011, is a leading omnichannel dog brand dedicated to dog happiness through innovative products, services, and content, including subscriptions and specialized food [Company Overview](index=3&type=section&id=Company%20Overview) BARK, founded in 2011, is a leading global omnichannel dog brand committed to enhancing dog happiness through innovative products, services, and content - BARK is the world's most dog-centric company, devoted to making dogs happy with the best products, services, and content[14](index=14&type=chunk) - Founded in **2011**, BARK offers themed toys and treats subscriptions (BarkBox and BARK Super Chewer), custom product collections through retail partners (Target and Amazon), high-quality nutritious meals (BARK Food), and dental care products (BARK Bright®)[14](index=14&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section cautions that the press release contains forward-looking statements subject to risks and uncertainties, advising investors to consult the Company's Form 10-Q for detailed risk factors [Disclaimer and Risk Factors](index=3&type=section&id=Disclaimer%20and%20Risk%20Factors) This section highlights that the press release contains forward-looking statements based on current expectations, which are subject to various risks and uncertainties - This press release contains forward-looking statements based on current expectations, forecasts, and assumptions, which involve risks and uncertainties[15](index=15&type=chunk) - Actual results could differ materially due to factors including the uncertainty of projected financial information, risks related to pet spending, customer conversion, product line expansion, competition, and macroeconomic events[15](index=15&type=chunk) - Undue reliance should not be placed on these statements, and investors should refer to the 'Risk Factors' and 'Management's Discussion and Analysis of Financial Condition and Results of Operations' in the Company's Form 10-Q for more information[16](index=16&type=chunk) [Key Performance Indicators](index=4&type=section&id=Key%20Performance%20Indicators) This section defines and presents key performance indicators for Q1 FY26, including Total Orders and Average Order Value, alongside Direct to Consumer Gross Profit and Margin [Definitions of Key Performance Indicators](index=4&type=section&id=Definitions%20of%20Key%20Performance%20Indicators) BARK defines 'Total Orders' as the aggregate number of Direct-to-Consumer (DTC) orders shipped, and 'Average Order Value' (AOV) as DTC revenue divided by Total Orders - **Total Orders** are defined as the total number of DTC orders shipped in a given period, including all orders across all product categories, regardless of subscription, auto-ship, or one-off basis[17](index=17&type=chunk) - **Average Order Value (AOV)** is calculated by dividing Direct to Consumer revenue for the period by Total Orders for the same period[18](index=18&type=chunk) [Key Performance Indicator Data](index=5&type=section&id=Key%20Performance%20Indicator%20Data) For the three months ended June 30, 2025, Total Orders decreased to 2,819 thousand, Average Order Value slightly declined, and Direct to Consumer Gross Margin increased to 69.3% Key Performance Indicators (Three Months Ended June 30) | Metric | June 30, 2025 | June 30, 2024 | | :------------------------------ | :------------ | :------------ | | Total Orders (in thousands) | 2,819 | 3,442 | | Average Order Value | $30.80 | $30.94 | | Direct to Consumer Gross Profit (in thousands) | $60,183 | $69,270 | | Direct to Consumer Gross Margin | 69.3% | 65.1% | [Condensed Consolidated Statement of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Operations%20and%20Comprehensive%20Loss) BARK's Q1 FY26 consolidated statement of operations shows a net loss of $(7.0) million, an improvement from the prior year, driven by reduced operating expenses despite lower total revenue [Q1 FY26 Consolidated Statement of Operations](index=5&type=section&id=Q1%20FY26%20Consolidated%20Statement%20of%20Operations) For Q1 FY26, BARK reported a net loss of $(7.0) million, an improvement from $(10.0) million in the prior year, with total revenue at $102.9 million and reduced operating expenses Condensed Consolidated Statement of Operations (Three Months Ended June 30) | Metric | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :-------------------------- | :------------------------ | :------------------------ | | REVENUE | $102,861 | $116,212 | | COST OF REVENUE | $38,784 | $42,946 | | Gross profit | $64,077 | $73,266 | | General and administrative | $57,252 | $63,426 | | Advertising and marketing | $15,178 | $20,432 | | Total operating expenses | $72,430 | $83,858 | | LOSS FROM OPERATIONS | $(8,353) | $(10,592) | | NET LOSS AND COMPREHENSIVE LOSS | $(7,030) | $(10,039) | [Disaggregated Revenue](index=6&type=section&id=Disaggregated%20Revenue) This section details BARK's Q1 FY26 revenue, showing a decline in Direct to Consumer revenue, particularly in Toys & Accessories, offset by significant growth in Commerce revenue and BARK Air contributions [Q1 FY26 Revenue by Segment and Category](index=6&type=section&id=Q1%20FY26%20Revenue%20by%20Segment%20and%20Category) In Q1 FY26, Direct to Consumer (DTC) revenue decreased to $89.2 million, while Commerce revenue significantly increased by 49.5% to $13.7 million, with BARK Air contributing $2.3 million Disaggregated Revenue (Three Months Ended June 30) | Revenue Category | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :------------------------ | :------------------------ | :------------------------ | | Direct to Consumer: | | | | Toys & Accessories | $51,800 | $70,569 | | Consumables | $35,030 | $35,904 | | Other (BARK Air) | $2,346 | $586 | | Total Direct to Consumer | $89,176 | $107,059 | | Commerce | $13,685 | $9,153 | | Total Revenue | $102,861 | $116,212 | [Gross Profit by Segment](index=6&type=section&id=Gross%20Profit%20by%20Segment) BARK's Q1 FY26 gross profit by segment shows a decrease in Direct to Consumer gross profit, while Commerce segment gross profit increased despite higher cost of revenue [Q1 FY26 Gross Profit by Segment](index=6&type=section&id=Q1%20FY26%20Gross%20Profit%20by%20Segment) For Q1 FY26, the Direct to Consumer (DTC) segment generated a gross profit of $59.7 million, a decrease from the prior year, while the Commerce segment's gross profit increased to $4.3 million Gross Profit by Segment (Three Months Ended June 30) | Segment | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :------------------------ | :------------------------ | :------------------------ | | Direct to Consumer: | | | | Revenue | $89,176 | $107,059 | | Cost of revenue | $29,431 | $38,051 | | Gross profit | $59,745 | $69,008 | | Commerce: | | | | Revenue | $13,685 | $9,153 | | Cost of revenue | $9,353 | $4,895 | | Gross profit | $4,332 | $4,258 | | Consolidated Gross profit | $64,077 | $73,266 | [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) This section presents BARK's consolidated balance sheets, highlighting total assets, liabilities, and stockholders' equity as of June 30, 2025, compared to the prior quarter [Balance Sheet Overview as of June 30, 2025](index=7&type=section&id=Balance%20Sheet%20Overview%20as%20of%20June%2030%2C%202025) As of June 30, 2025, BARK's total assets were $259.9 million, with cash and cash equivalents at $84.7 million and inventory at $98.1 million, while total liabilities increased to $166.0 million Consolidated Balance Sheets (June 30, 2025 vs. March 31, 2025) | Asset/Liability/Equity | June 30, 2025 (Thousands) | March 31, 2025 (Thousands) | | :------------------------------ | :------------------------ | :------------------------- | | Cash and cash equivalents | $84,665 | $94,022 | | Inventory | $98,124 | $88,126 | | Total current assets | $201,687 | $201,637 | | TOTAL ASSETS | $259,951 | $260,635 | | Total current liabilities | $130,491 | $124,040 | | Total liabilities | $165,982 | $161,109 | | Total stockholders' equity | $93,969 | $99,526 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) BARK's Q1 FY26 consolidated cash flow statements show net cash used in operating activities, primarily due to inventory increases, alongside investing and financing activities [Q1 FY26 Cash Flow Activities](index=8&type=section&id=Q1%20FY26%20Cash%20Flow%20Activities) For Q1 FY26, BARK reported net cash used in operating activities of $(5.4) million, largely due to a $10.3 million increase in inventory, alongside reduced investing and financing cash usage Consolidated Statements of Cash Flows (Three Months Ended June 30) | Cash Flow Activity | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :---------------------------------- | :------------------------ | :------------------------ | | Net loss | $(7,030) | $(10,039) | | Inventory change | $(10,283) | $2,521 | | Net cash (used in) provided by operating activities | $(5,440) | $1,792 | | Capital expenditures | $(708) | $(2,043) | | Net cash used in investing activities | $(708) | $(2,043) | | Payments to repurchase common stock | $(1,770) | $(4,286) | | Net cash used in financing activities | $(2,130) | $(4,300) | | NET DECREASE IN CASH | $(8,328) | $(4,530) | [Non-GAAP Financial Measures](index=9&type=section&id=Non-GAAP%20Financial%20Measures) This section defines BARK's non-GAAP financial measures, including Adjusted Net Loss, Adjusted EBITDA, and Free Cash Flow, used to provide a clearer view of underlying business performance [Definitions of Non-GAAP Measures](index=9&type=section&id=Definitions%20of%20Non-GAAP%20Measures) BARK utilizes several non-GAAP financial measures, including Adjusted Net Loss, Adjusted EBITDA, and Free Cash Flow, to offer investors supplementary information on its operating performance - Non-GAAP measures include **Adjusted Net Loss**, **Adjusted Net Loss Margin**, **Adjusted Net Loss Per Common Share**, **Adjusted EBITDA**, **Adjusted EBITDA Margin**, and **Free Cash Flow**[31](index=31&type=chunk) - Adjusted Net Loss excludes stock-based compensation, change in fair value of warrants and derivatives, sales and use tax income, restructuring charges, litigation expenses, warehouse restructuring costs, impairment of assets, technology modernization costs, and other items[32](index=32&type=chunk) - Adjusted EBITDA further excludes interest income/expense, depreciation and amortization, and capitalized cloud computing amortization from Net Loss, in addition to items excluded from Adjusted Net Loss[34](index=34&type=chunk) - **Free Cash Flow** is defined as net cash provided by (used in) operating activities less capital expenditures[36](index=36&type=chunk) [Adjusted Net Loss Reconciliation](index=10&type=section&id=Adjusted%20Net%20Loss%20Reconciliation) For Q1 FY26, BARK's Adjusted Net Loss was $(2.8) million, an improvement from $(4.0) million in Q1 FY25, after adjusting for non-cash and non-recurring items Adjusted Net Loss Reconciliation (Three Months Ended June 30) | Metric | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :------------------------------ | :------------------------ | :------------------------ | | Net Loss | $(7,030) | $(10,039) | | Stock compensation expense | $3,594 | $2,941 | | Change in fair value of warrants and derivatives | $(782) | $391 | | Sales and use tax income | $(240) | $(1,303) | | Restructuring | $423 | $773 | | Litigation expenses | $176 | $387 | | Warehouse restructuring costs | $726 | $539 | | Impairment of assets | — | $799 | | Technology modernization | $323 | $707 | | Other items | $57 | $820 | | Adjusted net loss | $(2,753) | $(3,985) | | Adjusted net loss margin | (2.68)% | (3.43)% | | Adjusted net loss per common share | $(0.02) | $(0.02) | [Adjusted EBITDA Reconciliation](index=11&type=section&id=Adjusted%20EBITDA%20Reconciliation) BARK achieved a positive Adjusted EBITDA of $0.1 million in Q1 FY26, a significant improvement from $(1.8) million in Q1 FY25, after various adjustments to net loss Adjusted EBITDA Reconciliation (Three Months Ended June 30) | Metric | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :------------------------------ | :------------------------ | :------------------------ | | Net Loss | $(7,030) | $(10,039) | | Interest income | $(809) | $(1,479) | | Interest expense | $709 | $711 | | Depreciation and amortization expense | $2,520 | $2,879 | | Stock compensation expense | $3,594 | $2,941 | | Change in fair value of warrants and derivatives | $(782) | $391 | | Cloud computing amortization | $421 | $78 | | Sales and use tax income | $(240) | $(1,303) | | Restructuring | $423 | $773 | | Litigation expenses | $176 | $387 | | Warehouse restructuring costs | $726 | $539 | | Impairment of assets | — | $799 | | Technology modernization | $323 | $707 | | Other items | $57 | $820 | | Adjusted EBITDA | $88 | $(1,796) | | Adjusted EBITDA margin | 0.09% | (1.55)% | [Free Cash Flow Reconciliation](index=12&type=section&id=Free%20Cash%20Flow%20Reconciliation) Free Cash Flow for Q1 FY26 was $(6.1) million, a decrease from $(0.3) million in Q1 FY25, derived from net cash used in operating activities less capital expenditures Free Cash Flow Reconciliation (Three Months Ended June 30) | Metric | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :-------------------------------------- | :------------------------ | :------------------------ | | Net cash (used in) provided by operating activities | $(5,440) | $1,792 | | Capital expenditures | $(708) | $(2,043) | | Free cash flow | $(6,148) | $(251) | [Contacts](index=12&type=section&id=Contacts) This section provides contact information for BARK's investor relations and media inquiries [Investor and Media Relations](index=12&type=section&id=Investor%20and%20Media%20Relations) This section provides the contact information for BARK's investor relations and media inquiries - Investor relations contact: **Michael Mougias** at **investors@barkbox.com**[46](index=46&type=chunk) - Media contact: **Garland Harwood** at **press@barkbox.com**[46](index=46&type=chunk)

Company Overview - BarkBox is a subscription service that delivers dog toys and treats to customers monthly, generating approximately $236 million in revenue since its founding in 2011 [4][7]. Incident Summary - A leaked message from a BarkBox employee on Reddit revealed the company's plans to reduce marketing for its Pride campaign, citing concerns that it may be perceived as a political statement rather than a celebration [1][2]. - CEO Matt Meeker confirmed the authenticity of the leaked message and issued an apology, stating that the message was disrespectful to the LGBTQIA+ community and did not reflect the company's values [5][8]. Marketing and Community Engagement - Despite the controversy, BarkBox continues to sell Pride-themed products and has committed to donating 100% of the revenue from this collection to an LGBTQIA+ nonprofit this year [7]. - The company has faced backlash from customers and former employees, with some calling for subscription cancellations due to the perceived comparison of LGBTQ+ support to politically charged symbols [7][10]. Industry Context - BarkBox is not alone in facing challenges related to marketing Pride products, as other companies like Target and Bud Light have also experienced backlash that affected their bottom lines [11]. - Major sponsors of Pride events, such as Mastercard and PepsiCo, have opted not to renew funding this year, reflecting a broader trend of companies reassessing their marketing strategies in light of current political climates [13].

Financial Data and Key Metrics Changes - The company achieved its first-ever positive adjusted EBITDA for the fiscal year, with Q4 delivering $5.2 million and a full-year total of $5.4 million, marking a significant turnaround from a loss of $58 million three years ago [6][22][23] - Revenue for Q4 was $115.4 million, bringing full-year revenue to $484.2 million, a decrease of 1.2% year-over-year [18][22] - Gross margins improved to 63.6% in Q4 and 62.4% for the full year, reflecting a 73 basis point improvement over the previous fiscal year [10][21] Business Line Data and Key Metrics Changes - The commerce segment grew by 27% year-over-year, achieving $68.3 million for the full year, representing 14% of total revenue [8][19] - Bark Air generated $1.8 million in revenue for Q4 and nearly $6 million for the full year, indicating strong early demand [20] - Direct-to-consumer (DTC) business faced challenges due to a deliberate pullback in marketing spend, impacting subscriber growth [18][48] Market Data and Key Metrics Changes - The company noted a slowdown in consumer sentiment, which affected order placements, particularly in Q4 and Q1 [46][53] - Retail partners adopted a cautious approach due to tariff uncertainties, leading to a temporary slowdown in order placements [70] Company Strategy and Development Direction - The company plans to accelerate diversification of revenue streams away from Bark Box subscriptions, which accounted for approximately 85% of revenue last year [13][14] - Investments will shift towards new product lines, distribution channels, and services, including consumables and AI-driven applications for pets [12][14] - The company is reassessing its supply chain in response to tariff increases, with plans to diversify manufacturing outside of China [24][25] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertainty created by tariffs and economic conditions but expressed confidence in maintaining positive adjusted EBITDA [10][28] - The company is unable to provide full-year guidance due to macroeconomic volatility but remains focused on driving efficiency and agility [27][30] - Management expects Q1 total revenue to be between $99 million and $101 million, reflecting a 14% decline at the midpoint compared to the previous year [29] Other Important Information - The company ended the fiscal year with $94 million in cash, down $21 million in the quarter due to share repurchases and working capital timing [23] - Total marketing expenses in Q4 were $17.3 million, down from the prior year, reflecting a cautious approach in response to macroeconomic conditions [21] Q&A Session Summary Question: Can you provide more details on diversifying your supplier base outside of China? - Management is exploring alternative geographies for manufacturing and has the flexibility to shift production outside of China by the end of the fiscal year [36] Question: Update on progress migrating to the Shopify platform? - The migration to Shopify is mostly complete, with active subscribers now being directed to the new platform, which allows for more nimble operations and experimentation [40] Question: What dynamics are affecting the direct-to-consumer business? - The company experienced strong customer acquisition during the holiday quarter but faced challenges in Q1 due to consumer sentiment and tariff impacts, leading to a strategic shift in marketing focus [46][48] Question: How has demand in the commerce segment changed? - Demand in the commerce segment remains strong, with a 27% growth in fiscal 2025, although there was a temporary slowdown in order placements due to tariff concerns [52][54] Question: Should the company consider more aggressive share buybacks? - Management is cautious about share buybacks given the current environment but remains open to opportunities if the stock is undervalued [62][64]

Financial Data and Key Metrics Changes - The company achieved its first-ever positive adjusted EBITDA for the fiscal year, with Q4 delivering $5.2 million and a full-year total of $5.4 million, marking a significant turnaround from a loss of $58 million three years ago [5][22][23] - Revenue for Q4 was $115.4 million, bringing full-year revenue to $484.2 million, a decrease of 1.2% year-over-year [17][22] - Gross margins improved to 63.6% in Q4 and 62.4% for the full year, reflecting a 73 basis point improvement over FY '24 and a 480 basis point improvement over FY '23 [8][20] Business Line Data and Key Metrics Changes - The commerce segment grew by 27% year-over-year, achieving $68.3 million for the full year, representing 14% of total revenue, up from 11% the previous year [7][19] - Bark Air generated $1.8 million in revenue for Q4 and nearly $6 million for the full year, indicating strong early demand for this new service [20] Market Data and Key Metrics Changes - The company faced headwinds in the direct-to-consumer (DTC) business due to a deliberate pullback in marketing spend in response to tariff uncertainties and weakening consumer sentiment [16][17] - The domestic market is experiencing challenges related to USPS rate changes, but the company is confident in its ability to mitigate these issues [26] Company Strategy and Development Direction - The company plans to accelerate the diversification of its revenue streams, moving away from a heavy reliance on Bark Box subscriptions, which accounted for approximately 85% of revenue last year [12][13] - Future investments will focus on new product lines, distribution channels, and services, including consumables and AI-driven applications for dogs [12][13] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertainty created by tariffs and economic conditions but expressed confidence in the company's ability to remain EBITDA positive and navigate these challenges [9][15][26] - The company is shifting its supply chain strategy to diversify sourcing and mitigate tariff impacts, with plans to start manufacturing in other regions [24][25] Other Important Information - The company ended the fiscal year with $94 million in cash, down $21 million in the quarter, reflecting share repurchases and working capital timing [23] - Total marketing expenses in Q4 were $17.3 million, down approximately $1.5 million from the prior year, as the company adopted a more cautious approach [21] Q&A Session Summary Question: Can you provide more details on diversifying your supplier base outside of China? - The company is exploring alternative manufacturing locations across various continents and has the flexibility to shift all toy production outside of China by the end of the fiscal year [34] Question: Update on progress migrating to the Shopify platform? - The migration is mostly complete, with active subscribers now primarily coming through the new platform, which allows for more nimble testing and experimentation [36][38] Question: What dynamics are affecting the direct-to-consumer business? - The company experienced strong customer acquisition during the holiday quarter but faced pressure from consumer sentiment and tariff noise, leading to a strategic pullback in marketing spend [44][46] Question: How has demand in the commerce segment changed? - Demand in the commerce segment has remained strong, with a 27% growth in fiscal 25, although there was a temporary slowdown in order placements due to tariff concerns [50][52] Question: What is the outlook for share buybacks given the current environment? - The company has been aggressive with share buybacks but is also focused on maintaining cash reserves for potential investments and navigating uncertainties [62][64] Question: How are conversations with retailers trending since the tariff rate changes? - Following the reduction in tariffs, demand and order placements have started to recover, with positive traction expected as seasonal demand picks up [70]

Revenue Performance - BARK's total revenue for fiscal 2025 was approximately $430 million, with Direct-to-Consumer (DTC) sales representing 85.9% of total revenue[23]. - Revenue from the commerce segment, which includes retail sales, totaled $68 million, reflecting a 27.2% increase compared to fiscal 2024[42]. - Total revenue for the fiscal year ended March 31, 2025, was $484.2 million, a decrease of 1.2% compared to $490.2 million in fiscal 2024[192]. - Direct to Consumer revenue decreased by $20.6 million, or 4.7%, primarily due to a 5.1% decrease in Total Orders and a 1.0% decrease in Average Order Value[193]. - Commerce revenue increased by $14.6 million, or 27.2%, driven by sales volume from existing and new customers[194]. - Total revenue for the fiscal year ended March 31, 2025, was $490.2 million, a decrease of $45.1 million, or 8.4%, compared to the previous year[203]. Product Categories - The consumables category, which includes treats, kibble, and supplements, accounted for about one-third of total revenue in fiscal 2025, indicating significant growth potential[32]. - BARK's toys & accessories revenue was approximately $262.3 million in fiscal 2025, down 8% from fiscal 2024, prompting a strategic shift towards consumables[27]. - BARK Air, a new service offering for dog travel, generated $5.8 million in revenue in its first fiscal year, showcasing strong customer demand[33]. - The company aims to expand its product offerings, particularly in the consumables category, to increase average order value and attract new customers[162]. Operational Efficiency - The company achieved its first full year of positive Adjusted EBITDA in fiscal 2025, driven by operational efficiency and improved gross margins[44]. - Operating expenses decreased by 3.0% to $337.1 million in fiscal 2025, compared to $347.7 million in fiscal 2024[192]. - General and administrative expenses decreased by $15.0 million, or 5.6%, to $253.4 million for the fiscal year ended March 31, 2025, primarily due to reduced shipping costs and headcount[197]. Market Trends and Challenges - The annual spend on pets in the U.S. was approximately $152 billion in 2024, representing a 3% increase from 2023, highlighting a growing market opportunity[21]. - The company faces macroeconomic challenges, including rising inflation and supply chain disruptions, which may impact consumer spending and overall business performance[165]. - Economic downturns and macroeconomic conditions can adversely affect consumer discretionary spending, impacting BARK's revenue[77]. Customer Engagement and Technology - BARK's unified e-commerce platform, launched on Shopify, aims to enhance customer experience and cross-selling capabilities across its product suite[43]. - The company serves over 200,000 customers each month through its customer service team, leveraging data from these interactions for product development[158]. - The reliance on third-party SaaS technologies for critical business functions poses risks; any service interruptions could disrupt operations and increase expenses[95]. Risks and Compliance - The company is subject to various regulations affecting its operations, including those related to consumer protection, data security, and product safety[61][64]. - The company faces risks related to customer acquisition costs, which may exceed expectations, impacting revenue growth and operational efficiency[69]. - The company may face supply chain disruptions due to natural disasters, pandemics, or geopolitical developments, which could materially affect operations[86]. - The complexities of managing omnichannel operations could adversely impact inventory management and operational efficiency, affecting financial results[88]. Financial Metrics and Future Outlook - Adjusted Net Loss is calculated by excluding various expenses including stock-based compensation and restructuring charges[213]. - The company intends to retain future earnings for business expansion and does not expect to pay dividends in the foreseeable future[126]. - The stock price may be volatile and decline due to various factors, including fluctuations in revenue and results of operations[120].

Revenue Performance - Total revenue for Q4 2025 was $115.4 million, a decrease of 5.0% year-over-year, while full-year revenue was $484.2 million, down 1.2%[5] - Direct to Consumer (DTC) revenue in Q4 2025 was $100.1 million, an 8.5% decrease year-over-year, while full-year DTC revenue was $415.8 million, down 4.7%[8] - Commerce revenue in Q4 2025 was $15.4 million, up 26.5% year-over-year, and for the full year, it was $68.3 million, a 27.2% increase compared to the prior year[5] - Total revenue for the fiscal year ended March 31, 2025, was $484.182 million, a decrease of 11% from $535.315 million in 2024[27] - Direct to Consumer revenue decreased to $415.837 million in 2025 from $471.994 million in 2024, representing a decline of 12%[27] Profitability Metrics - Adjusted EBITDA for Q4 2025 was $5.2 million, marking a $3.0 million improvement, and for the full year, it was $5.4 million, an improvement of $16.0 million compared to the previous year[5] - The company reported a net loss of $32.878 million for the fiscal year 2025, an improvement from a net loss of $37.010 million in 2024[33] - The net loss for Q4 2025 was $(6.1) million, an increase of $1.2 million from the previous year, while the full-year net loss was $(32.9) million, a $4.1 million improvement[5] - The net loss margin for the fiscal year ended March 31, 2025, was (6.79)%, improving from (7.55)% in 2024[45] - Adjusted net income for the three months ended March 31, 2025, was $2,340,000, compared to an adjusted net loss of $(485,000) in 2024[44] - The adjusted net income (loss) margin for the fiscal year ended March 31, 2025, was (0.89)%, an improvement from (4.08)% in 2024[44] Cash Flow and Liquidity - The cash and cash equivalents balance as of March 31, 2025, was $94.0 million, which included $10.5 million in share repurchases during Q4[14] - Cash and cash equivalents decreased to $94.022 million as of March 31, 2025, compared to $125.495 million in 2024, indicating a decline of 25%[31] - Free cash flow for the three months ended March 31, 2025, was $(11,987,000), compared to $(3,174,000) for the same period in 2024[48] Operational Metrics - Total Orders for Q4 2025 were 3,166,000, down from 3,499,000 in the same period last year, while full-year Total Orders were 13,210,000, a decrease from 13,924,000[23] - Average Order Value (AOV) for Q4 2025 was $31.05, slightly down from $31.25 in the previous year, while full-year AOV was $31.04, compared to $31.34 in the prior year[23] Future Outlook - The company expects Q1 2026 revenue guidance of $99.0 million to $101.0 million, reflecting a decline from $116.2 million in the previous year due to reduced DTC marketing and tariff impacts[14] - The company plans to focus on new product development and market expansion strategies to drive future growth[27] Cost and Expenses - Capital expenditures for the fiscal year ended March 31, 2025, were $(6,157,000), down from $(8,831,000) in 2024[48] - The company recorded restructuring costs of $3,829,000 for the fiscal year ended March 31, 2025, compared to $1,660,000 in 2024[44] - Technology modernization costs for the fiscal year ended March 31, 2025, amounted to $2,400,000, reflecting ongoing investment in infrastructure[45] Balance Sheet Highlights - Total current liabilities increased to $124.040 million in 2025 from $75.478 million in 2024, marking a significant rise of 64%[31] - Inventory levels rose to $88.126 million in 2025, up from $84.177 million in 2024, indicating a 5% increase[31] - The company’s total assets decreased to $260.635 million in 2025 from $298.588 million in 2024, a decline of 13%[31]