PART I. Financial Information [Financial Statements (Unaudited)](index=4&type=section&id=ITEM%201.%20Financial%20Statements%20(Unaudited)) This section presents BARK, Inc.'s unaudited condensed consolidated financial statements for Q3 2023, detailing financial position, operations, equity changes, and cash flows, along with related notes and a subsequent debt repurchase Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Sep 30, 2023 | Mar 31, 2023 | | :--- | :--- | :--- | | **Total Current Assets** | $286,618 | $312,353 | | Cash and cash equivalents | $160,541 | $177,911 | | Inventory | $109,391 | $124,336 | | **Total Assets** | **$368,986** | **$400,420** | | **Total Current Liabilities** | $85,962 | $99,601 | | Long-Term Debt | $81,594 | $81,221 | | **Total Liabilities** | **$218,039** | **$229,883** | | **Total Stockholders' Equity** | **$150,947** | **$170,537** | Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2023 | Six Months Ended Sep 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $123,036 | $143,814 | $243,626 | $274,964 | | **Gross Profit** | $75,642 | $80,341 | $148,678 | $156,155 | | **Loss from Operations** | $(11,099) | $(9,146) | $(25,103) | $(29,284) | | **Net Loss** | **$(10,337)** | **$(10,639)** | **$(22,000)** | **$(26,047)** | | **Net Loss per Share** | $(0.06) | $(0.06) | $(0.12) | $(0.15) | - The company operates in two reportable segments: Direct to Consumer (DTC) and Commerce, with DTC revenue at **$216.2 million** and Commerce revenue at **$27.4 million** for the six months ended September 30, 2023[91](index=91&type=chunk)[93](index=93&type=chunk) - Subsequent to quarter end, on November 2, 2023, the company repurchased **$45.0 million** of its outstanding 5.50% Convertible Secured Notes due 2025 for a total cash price of **$44.4 million**[94](index=94&type=chunk)[95](index=95&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses BARK's financial performance, noting decreased revenue due to lower order volumes, improved gross margin, reduced net loss, positive Adjusted EBITDA, and strong liquidity, as the company focuses on profitability [Overview and Key Performance Indicators](index=22&type=section&id=MD%26A_Overview) BARK, an omnichannel dog brand, operates across Toys & Accessories and Consumables, selling DTC via subscriptions and through retail partners, with Total Orders and Average Order Value as key performance indicators Key Performance Indicators | Indicator | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2023 | Six Months Ended Sep 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Total Orders (in thousands) | 3,361 | 3,689 | 6,921 | 7,557 | | Average Order Value | $31.03 | $31.87 | $31.24 | $31.22 | - The company has expanded into larger consumables markets such as kibble, toppers, supplements, and dental products, which is expected to significantly increase its total addressable market[100](index=100&type=chunk) [Results of Operations](index=26&type=section&id=MD%26A_Results_of_Operations) Q2 FY2024 total revenue decreased **14.4%** to **$123.0 million** due to lower order volumes in DTC and Commerce, yet gross profit declined less at **5.8%** due to margin expansion, resulting in a slightly improved net loss Revenue by Segment - Q2 FY2024 vs Q2 FY2023 (in thousands) | Segment | Q2 2023 Revenue | Q2 2022 Revenue | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Direct to Consumer | $104,312 | $117,547 | $(13,235) | (11.3)% | | Commerce | $18,724 | $26,267 | $(7,543) | (28.7)% | | **Total Revenue** | **$123,036** | **$143,814** | **$(20,778)** | **(14.4)%** | Gross Profit by Segment - Q2 FY2024 vs Q2 FY2023 (in thousands) | Segment | Q2 2023 Gross Profit | Q2 2022 Gross Profit | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Direct to Consumer | $67,679 | $71,611 | $(3,932) | (5.5)% | | Commerce | $7,963 | $8,730 | $(767) | (8.8)% | | **Total Gross Profit** | **$75,642** | **$80,341** | **$(4,699)** | **(5.8)%** | - General and administrative expenses decreased by **$5.2 million (7.0%)** in Q2 2023, primarily due to lower shipping and fulfillment costs, reduced compensation expense, and lower consultant fees, partially offset by a **$3.0 million** non-cash impairment charge[131](index=131&type=chunk) - Advertising and marketing expense increased by **$2.5 million (16.2%)** in Q2 2023 due to increased marketing spend[132](index=132&type=chunk) [Non-GAAP Financial Measures](index=32&type=section&id=MD%26A_Non-GAAP) The company utilizes non-GAAP measures like Adjusted Net Loss, Adjusted EBITDA, and Free Cash Flow, reporting improved Q2 2023 Adjusted EBITDA of **$1.0 million** and positive Free Cash Flow of **$0.9 million** Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Line Item | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net loss | $(10,337) | $(10,639) | | Adjustments (Interest, D&A, SBC, etc.) | 11,341 | 8,629 | | **Adjusted EBITDA** | **$1,004** | **$(2,010)** | Reconciliation of Net Loss to Adjusted Net Loss (in thousands) | Line Item | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net loss | $(10,337) | $(10,639) | | Adjustments (SBC, Warrants, Impairment, etc.) | 8,897 | 5,289 | | **Adjusted net loss** | **$(1,440)** | **$(5,350)** | Free Cash Flow (in thousands) | Line Item | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $2,825 | $(2,138) | | Capital expenditures | $(1,961) | $(9,373) | | **Free cash flow** | **$864** | **$(11,511)** | [Liquidity and Capital Resources](index=36&type=section&id=MD%26A_Liquidity) As of September 30, 2023, the company held **$160.5 million** in cash, sufficient for 12 months, with **$83.5 million** in 2025 Convertible Notes outstanding and improved operating cash flow despite a credit facility expiration - As of September 30, 2023, the company had cash and cash equivalents of approximately **$160.5 million**[164](index=164&type=chunk) - The company's **$35.0 million** secured revolving line of credit with Western Alliance Bank expired on October 31, 2023, with no outstanding borrowings, and the company is evaluating alternative options[170](index=170&type=chunk) Cash Flow Summary - Six Months Ended (in thousands) | Cash Flow Activity | Sep 30, 2023 | Sep 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(7,916) | $(19,563) | | Net cash used in investing activities | $(4,933) | $(14,108) | | Net cash (used in) provided by financing activities | $(4,665) | $586 | [Quantitative and Qualitative Disclosures about Market Risk](index=39&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company outlines its minimal exposure to market risks, including interest rate, inflation, and foreign exchange, none of which have materially impacted its business due to specific mitigating factors - The company's primary exposure to interest rate risk was its Western Alliance credit facility, which expired on October 31, 2023, with no outstanding borrowings[182](index=182&type=chunk) - The company does not believe inflation has had a material effect on its business, financial condition, or results of operations[183](index=183&type=chunk) - Foreign exchange risk is not expected to have a material impact as the company operates primarily within the United States and executes most transactions in U.S. dollars[184](index=184&type=chunk) [Controls and Procedures](index=39&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of September 30, 2023, with no material changes to internal control over financial reporting - The principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures are effective[185](index=185&type=chunk) - There was no change in the Company's internal control over financial reporting during the most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting[185](index=185&type=chunk) PART II. Other Information [Legal Proceedings](index=40&type=section&id=ITEM%201.%20Legal%20Proceedings) The company faces two early-stage legal proceedings: a California class action regarding automatic renewal disclosures and a Delaware shareholder class action challenging the corporate opportunity doctrine renunciation - A class action lawsuit, *Farmer v. BarkBox, Inc.*, alleges the company failed to adequately disclose the automatic renewal of its subscription plans in violation of California law, with an appeal pending after denial of a motion to compel arbitration[187](index=187&type=chunk) - A shareholder class action, *Vernon v. BARK, Inc.*, was filed in Delaware seeking to have the renunciation of the corporate opportunity doctrine in the company's certificate of incorporation declared invalid[188](index=188&type=chunk) [Risk Factors](index=40&type=section&id=ITEM%201A.%20Risk%20Factors) This section details the company's comprehensive risk factors, including strategic, macroeconomic, operational, competitive, technological, regulatory, legal, and financial challenges, alongside its history of losses and stock price volatility - Strategic risks include challenges in acquiring new customers cost-effectively, maintaining high customer engagement, and successfully launching new products in a competitive market[191](index=191&type=chunk)[193](index=193&type=chunk)[197](index=197&type=chunk) - The business is critically reliant on a limited number of suppliers and manufacturers, primarily located in Asia, and on third-party logistics providers, exposing it to supply chain, geopolitical, and shipping risks[204](index=204&type=chunk)[207](index=207&type=chunk) - The company is subject to extensive and evolving laws and regulations regarding data privacy (e.g., CCPA/CPRA), consumer protection, and product safety, which could lead to significant costs and liabilities[223](index=223&type=chunk)[225](index=225&type=chunk)[226](index=226&type=chunk) - Financial risks include a history of losses, potential inability to achieve or sustain profitability, limitations imposed by debt covenants, and potential for stock price volatility[236](index=236&type=chunk)[239](index=239&type=chunk)[241](index=241&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is not applicable for the reporting period - Not applicable[252](index=252&type=chunk) [Defaults Upon Senior Securities](index=55&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities during the period - None[253](index=253&type=chunk) [Mine Safety Disclosures](index=55&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's business - Not applicable[253](index=253&type=chunk) [Other Information](index=55&type=section&id=ITEM%205.%20Other%20Information) The company discloses no Rule 10b5-1 trading plan adoptions or terminations by directors/officers, and reports a post-quarter repurchase of **$45.0 million** of its 2025 Convertible Notes - During the reporting period, no director or officer adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5–1 trading arrangement[254](index=254&type=chunk) - On November 2, 2023, the Company repurchased **$45.0 million** of its 5.50% Convertible Secured Notes due 2025 for a total cash purchase price of **$44.4 million**[254](index=254&type=chunk)[255](index=255&type=chunk) [Exhibits](index=55&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the Notes Purchase Agreement, Officer Certifications, and XBRL financial data - A list of filed exhibits is provided, including the Notes Purchase Agreement (10.1), Officer Certifications (31.1, 31.2, 31.3, 32.1, 32.2, 32.3), and XBRL data files (101 series)[257](index=257&type=chunk)[260](index=260&type=chunk)

BARK, Inc. (NYSE:BARK) Q1 2024 Results Conference Call August 8, 2023 4:30 PM ET Company Participants Mike Mougias - VP, IR Matt Meeker - Co-Founder, CEO Zahir Ibrahim - CFO Conference Call Participants Maria Ripps - Canaccord Ryan Meyers - Lake Street Capital Markets Ygal Arounian - Citi Max Rakhlenko - TD Cowen Operator Good morning, good afternoon, and good evening. My name is Robert McArthur, I'll be your conference operator today. At this time, I'd like to welcome everyone to BARK's Fiscal First Quar ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39691 BARK, INC. (Exact name of registrant as specified in its charter) Delaware 85-1872418 (State or Other Jurisdiction of Incorp ...

Financial Data and Key Metrics Changes - The company reported a total revenue of $126 million for Q4 2023, exceeding guidance by $5 million, and a full-year revenue of just over $535 million, representing a 5.5% increase compared to fiscal 2022 [14][27] - The company achieved free cash flow positivity for the second consecutive quarter, ending Q4 with $178 million in cash, an increase of $14 million sequentially, and reduced cash burn from $194 million in fiscal 2022 to just $17 million in fiscal 2023 [7][33] - Adjusted EBITDA loss improved nearly 50% to negative $31 million for the full year, compared to a loss of $58 million in fiscal 2022 [18][33] Business Line Data and Key Metrics Changes - Direct-to-Consumer (DTC) revenue decreased slightly by 1.5% in Q4, while commerce revenue declined by 9.3% for the quarter; however, DTC revenue increased by 5.3% for the full year [27][28] - Toy revenue increased by 5% to $371 million in fiscal 2023, while consumables revenue grew by 7.2% to $164 million, driven mainly by food and dental products [15][29] - The average order value (AOV) increased by $2.11 year-over-year to $31.70 for the full year, with Q4 AOV at $32.70, reflecting improved cross-selling capabilities [8][26] Market Data and Key Metrics Changes - The company anticipates softness in retail sales in the first half of fiscal 2024 as retailers manage existing inventory, but expects revenue to accelerate in the second half, particularly in Q4 [27][35] - The company is focusing on expanding its consumables business, which currently has virtually no retail presence, and expects significant growth as it introduces treats and dental products to retail partners [10][22] Company Strategy and Development Direction - The company aims to grow its Direct-to-Consumer e-commerce and subscription business, consumables, and services as key pillars for future growth [9][10] - The company has updated its KPIs to reflect a more accurate representation of its business model, moving away from a subscription-only focus to include one-off purchases [12] - The company plans to leverage its strong brand and customer relationships to expand into services, viewing this as a long-term growth opportunity [10][44] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving breakeven adjusted EBITDA for fiscal 2024, with expectations for gross margin improvement of 200 to 300 basis points [18][20] - The management highlighted the importance of transitioning from profitability to growth mode, with a focus on expanding the consumables business and improving customer lifetime value [37][59] - Management noted that the stock price does not currently reflect the company's progress and long-term potential, emphasizing the undervaluation given the company's revenue and cash position [22] Other Important Information - The company reduced its annual G&A expenses by $12 million through cost reduction initiatives, with $10 million expected to flow into fiscal 2024 [17][30] - The company expects to maintain a cash balance exceeding $180 million by year-end, despite anticipated negative free cash flow in the first half of fiscal 2024 [36] Q&A Session Summary Question: Long-term mix of subscriptions versus standalone purchases - Management indicated that while subscriptions remain significant, there is a growing trend towards one-off purchases, particularly for consumables, reflecting customer demand for flexibility [39][40][41] Question: Growth opportunities in services - Management discussed the potential for expanding into services, leveraging their brand and customer data to create new offerings that enhance the customer experience [42][43] Question: Breakdown of consumable customers - The majority of consumable customers are existing BARK customers, with recent efforts focused on cross-selling and increasing conversion rates [46][47] Question: Adjusted EBITDA guidance and revenue trajectory - Management explained that Q1 revenue is expected to be softer due to retail inventory issues, but anticipates improved performance in the second half of the year [49][50][51] Question: Expanded assortment in retail - Management confirmed that treats are the primary focus for retail expansion, with dental products also being prioritized for introduction [61][62]

Financial Performance - Total revenue for fiscal 2023 was approximately $348 million, with a 4.3% increase compared to fiscal 2022[16] - Direct-to-consumer (DTC) business represented 88.2% of total revenue, while commerce business accounted for 11.8%[14] - Cross-selling revenue reached $41 million, up 35% compared to the prior year[15] Market Insights - The U.S. pet products market was valued at approximately $137 billion in 2022, reflecting an increase of over $13 billion, or nearly 11%, from 2021[12] - E-commerce sales of pet products accounted for an estimated 36% in 2022, projected to rise to 45% by 2026[12] Product Development and Strategy - BARK's consumables category is expected to drive significant future growth, with plans to introduce treats in retail by the end of fiscal 2024[26] - The company is unifying its brand under the bark.co domain to enhance customer experience and cross-selling capabilities[27] - BARK products are sold in over 40,000 retail doors, including major retailers like Target and Walmart[14] Operational Insights - At the end of fiscal 2023, BARK employed approximately 900 full-time and part-time employees[29] - The company utilizes global third-party logistics providers for warehousing and distribution, managing inventory levels through demand forecasting[37] Financial Position - As of March 31, 2023, the company had cash and cash equivalents of approximately $177.9 million, consisting of bank deposits and money market accounts[242] - The company has no outstanding borrowings under the Credit Facility as of March 31, 2023, indicating a strong liquidity position[243] Risk Management - The company does not believe inflation has had a material effect on its business, but acknowledges potential risks if costs rise significantly[244] - The company operates primarily within the United States and executes most transactions in U.S. dollars, limiting foreign exchange risk[245] Corporate Culture and Values - The company emphasizes a culture of inclusiveness and diversity, focusing on recruitment, continuous learning, and employee resource groups[33] - The company is committed to fair employee compensation, regularly reviewing equity grants for parity across gender and race[34] Relationships and Compliance - The company maintains long-standing relationships with a diverse base of manufacturers, ensuring compliance with specifications and applicable laws[36] Competitive Landscape - The dog products industry is highly competitive, with key factors including product selection, customer service, and brand loyalty[41] Intellectual Property - The company believes its intellectual property, including trademarks and domain names, significantly contributes to its brand recognition and market success[40]

BARK, Inc. (NYSE:BARK) Q3 2023 Earnings Conference Call February 3, 2023 4:30 PM ET Company Participants Mike Mougias - Vice President of Investor Relations Matt Meeker - Co-Founder and Chief Executive Officer Zahir Ibrahim - Chief Financial Officer Conference Call Participants Maria Ripps - Canaccord Genuity Corey Grady - Jefferies Ryan Meyers - Lake Street Capital Markets Ygal Arounian - Citigroup Operator Good afternoon. Thank you for attending today's BARK's Third Quarter Fiscal 2023 Earnings Call. My n ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39691 BARK, INC. (Exact name of registrant as specified in its charter) Delaware 85-1872418 (State or Other Jurisdiction of In ...

BARK, Inc. (NYSE:BARK) Q2 2023 Earnings Conference Call November 9, 2022 4:30 PM ET Company Participants Mike Mougias - Vice President of Investor Relations Matt Meeker - Co-Founder and Chief Executive Officer Howard Yeaton - Interim Chief Financial Officer Conference Call Participants Corey Grady - Jefferies Maria Ripps - Canaccord Operator Good evening. Thank you for attending today's BARK's Second Quarter Fiscal Year 2023 Earnings Call. My name is Megan, and I'll be your moderator for today's call. All l ...

[PART I. Financial Information](index=4&type=section&id=PART%20I.%20Financial%20Information) This section provides unaudited financial statements, management's analysis, market risk disclosures, and internal controls [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=ITEM%201.%20Financial%20Statements%20%28Unaudited%29) This section presents BARK, Inc.'s unaudited condensed consolidated financial statements, including balance sheets, income statements, equity, and cash flows, with detailed notes on accounting policies and financial items [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | September 30, 2022 | March 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $166,310 | $199,397 | | Inventory | $160,634 | $153,115 | | Total current assets | $356,604 | $368,142 | | **Total Assets** | **$444,854** | **$434,061** | | **Liabilities & Equity** | | | | Accounts payable | $45,275 | $36,834 | | Total current liabilities | $111,325 | $108,611 | | Long-term debt | $76,517 | $76,190 | | **Total Liabilities** | **$244,747** | **$217,000** | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) This section outlines the company's financial performance over specific periods, detailing revenues, expenses, and net income or loss Statement of Operations Summary (in thousands) | Metric | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Six Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$143,814** | **$120,162** | **$274,964** | **$237,768** | | Gross Profit | $80,341 | $69,886 | $156,155 | $139,677 | | Loss from Operations | ($9,146) | ($15,424) | ($29,284) | ($32,282) | | **Net Income (Loss)** | **($10,639)** | **$6,455** | **($26,047)** | **($18,349)** | | Net income (loss) per share—basic | ($0.06) | $0.04 | ($0.15) | ($0.13) | [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) This section details changes in the company's equity over time, including net income, stock-based compensation, and share transactions - Total stockholders' equity **decreased from $217.1 million to $200.1 million** as of September 30, 2022, primarily due to a **net loss of $26.0 million**, partially offset by **$8.2 million** in stock-based compensation[16](index=16&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes the cash inflows and outflows from operating, investing, and financing activities over specific periods Cash Flow Summary for Six Months Ended September 30 (in thousands) | Cash Flow Activity | 2022 | 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($19,563) | ($108,019) | | Net cash used in investing activities | ($14,108) | ($11,003) | | Net cash provided by financing activities | $586 | $354,168 | | **Net (Decrease) Increase in Cash** | **($33,083)** | **$235,146** | - The significant decrease in cash provided by financing activities in 2022 compared to 2021 is attributed to the prior year's inclusion of **$227.1 million** from the Merger and **$200.0 million** from the PIPE Issuance[22](index=22&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes offer detailed explanations of the company's accounting policies and financial statement line items, covering revenue recognition, long-term debt, stock-based compensation, leases, legal contingencies, and segment reporting Disaggregated Revenue by Segment (in thousands) | Segment | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Six Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Direct to Consumer | $117,547 | $106,817 | $235,944 | $212,193 | | Commerce | $26,267 | $13,345 | $39,020 | $25,575 | | **Total Revenue** | **$143,814** | **$120,162** | **$274,964** | **$237,768** | - As of September 30, 2022, the company reported **$76.5 million** in total long-term debt, primarily from the 2025 Convertible Notes[57](index=57&type=chunk)[58](index=58&type=chunk) - The company is involved in a class-action lawsuit filed on September 1, 2022, alleging violations of California's Automatic Renewal Law, for which a Motion to Dismiss and Compel Arbitration was filed[85](index=85&type=chunk) Segment Gross Profit (in thousands) | Segment | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Six Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Direct to Consumer | $71,611 | $64,318 | $142,860 | $128,874 | | Commerce | $8,730 | $5,568 | $13,295 | $10,803 | | **Total Gross Profit** | **$80,341** | **$69,886** | **$156,155** | **$139,677** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, highlighting revenue growth, key performance indicators, liquidity, and non-GAAP measures, despite reporting a net loss [Key Performance Indicators](index=25&type=section&id=Key%20Performance%20Indicators) This section outlines key metrics such as Subscription Shipments, Active Subscriptions, Customer Acquisition Cost, and Average Order Value used to evaluate business performance Key Performance Indicators Comparison | Metric (in thousands, except CAC, LTV:CAC, AOV) | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Six Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Subscription Shipments | 3,653 | 3,593 | 7,464 | 7,201 | | Active Subscriptions | 2,241 | 2,089 | 2,241 | 2,089 | | New Subscriptions | 218 | 271 | 477 | 551 | | CAC | $53.19 | $51.71 | $51.89 | $50.01 | | Average Order Value | $32.18 | $29.73 | $31.61 | $29.47 | [Results of Operations](index=28&type=section&id=Results%20of%20Operations) This section details the company's operational results, including revenue growth across segments, changes in gross profit and margin, and the narrowing of loss from operations - For the three months ended September 30, 2022, Direct to Consumer revenue increased **10.0%** year-over-year, driven by a **1.7%** rise in Subscription Shipments and an **8.2%** increase in average order value[131](index=131&type=chunk) - Commerce revenue for the three months ended September 30, 2022, surged **96.8%** year-over-year, primarily due to increased volume and accelerated seasonal product orders from retail partners[131](index=131&type=chunk) - Gross margin for the three months ended September 30, 2022, decreased to **55.9%** from **58.2%** year-over-year, primarily due to the higher proportion of lower-margin Commerce business revenue, with Direct to Consumer gross margin at **60.9%** and Commerce at **33.2%**[132](index=132&type=chunk)[133](index=133&type=chunk) - Advertising and marketing expense decreased by **10.2%** year-over-year for the quarter, reflecting reduced media spend due to fewer new subscriber acquisitions[135](index=135&type=chunk) [Non-GAAP Financial Measures](index=33&type=section&id=Non-GAAP%20Financial%20Measures) This section presents non-GAAP measures like Adjusted Net Loss and Adjusted EBITDA, which show improved performance despite continued losses Reconciliation of Net Income (Loss) to Adjusted EBITDA (in thousands) | Metric | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Six Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | ($10,639) | $6,455 | ($26,047) | ($18,349) | | **Adjusted EBITDA** | **($2,010)** | **($8,779)** | **($15,042)** | **($16,385)** | | Adjusted EBITDA margin | (1.40)% | (7.31)% | (5.47)% | (6.89)% | Reconciliation of Net Income (Loss) to Adjusted Net Loss (in thousands) | Metric | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Six Months Ended Sep 30, 2022 | Six Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | ($10,639) | $6,455 | ($26,047) | ($18,349) | | **Adjusted net loss** | **($5,350)** | **($11,032)** | **($21,787)** | **($21,043)** | | Adjusted net loss per share | ($0.03) | ($0.07) | ($0.12) | ($0.15) | [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) This section details the company's cash position, operating cash flows, and available credit facilities, which are expected to fund operations for the next 12 months - The company concluded the quarter with **$166.3 million** in cash and cash equivalents[161](index=161&type=chunk) - Net cash used in operating activities for the six months ended September 30, 2022, was **$19.6 million**, a significant improvement from **$108.0 million** used in the prior year period[173](index=173&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk) - The company holds a **$35.0 million** secured revolving line of credit with Western Alliance Bank, maturing May 31, 2023, with no outstanding borrowings as of September 30, 2022[170](index=170&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=41&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company assesses its exposure to market risks, concluding no material impact from interest rates, inflation, or foreign exchange fluctuations - The company does not believe it has material exposure to interest rate risk, inflation risk, or foreign exchange risk[183](index=183&type=chunk)[185](index=185&type=chunk)[186](index=186&type=chunk) [Item 4. Controls and Procedures](index=42&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of September 30, 2022, due to identified material weaknesses in internal control over financial reporting, for which remediation efforts are underway - Management concluded that disclosure controls and procedures were not effective as of September 30, 2022, due to identified material weaknesses[188](index=188&type=chunk) - Material weaknesses were identified in four key areas: insufficient review of account reconciliations, lack of formalized inventory management controls, improper accounting review for complex transactions, and ineffective IT general controls[191](index=191&type=chunk) - The company is implementing remediation efforts, including improving IT controls, hiring additional personnel, enhancing the inventory management system, and formalizing accounting review processes[192](index=192&type=chunk)[193](index=193&type=chunk)[194](index=194&type=chunk) [PART II. Other Information](index=44&type=section&id=PART%20II.%20Other%20Information) This section provides additional disclosures, including legal proceedings, risk factors, and other required information not covered in the financial statements [Item 1. Legal Proceedings](index=44&type=section&id=ITEM%201.%20Legal%20Proceedings) This section discloses a class-action complaint filed against BarkBox, Inc., alleging violations of California's Automatic Renewal Law, which the company intends to vigorously defend - A class-action complaint was filed against BarkBox, Inc. on September 1, 2022, alleging inadequate disclosure of automatic subscription renewals in violation of California law[197](index=197&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=ITEM%201A.%20Risk%20Factors) This section details various risks, including customer acquisition challenges, macroeconomic sensitivity, supply chain dependencies, competition, and internal control weaknesses, that could adversely affect the company's business - Strategic risks encompass challenges in cost-effective customer acquisition, brand reputation protection, and successful new product introductions like BARK Food[200](index=200&type=chunk)[203](index=203&type=chunk)[204](index=204&type=chunk) - The business faces macroeconomic risks due to its reliance on consumer discretionary spending, susceptible to inflation, economic downturns, and COVID-19 impacts[210](index=210&type=chunk)[211](index=211&type=chunk) - Operational risks arise from critical reliance on a limited number of suppliers, manufacturers, and logistics partners, primarily in Asia, leading to potential supply chain disruptions[212](index=212&type=chunk) - The company has identified material weaknesses in internal controls over financial reporting, which could result in material misstatements if not remediated[244](index=244&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is marked as 'Not applicable' in the report [Item 3. Defaults Upon Senior Securities](index=59&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) The report indicates 'None' for this item [Item 4. Mine Safety Disclosures](index=59&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is marked as 'Not applicable' in the report [Item 5. Other Information](index=59&type=section&id=ITEM%205.%20Other%20Information) The report indicates 'None' for this item [Item 6. Exhibits](index=59&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and XBRL data files

BARK, Inc. (NYSE:BARK) Q1 2023 Earnings Conference Call August 9, 2022 4:30 PM ET Company Participants Mike Mougias – Vice President of Investor Relations Matt Meeker – Co-Founder and Chief Executive Officer Howard Yeaton – Interim Chief Financial Officer Conference Call Participants Maria Ripps – Canaccord Corey Grady – Jefferies Operator Good afternoon. My name is Audra, and I will be your conference operator today. At this time, I would like to welcome everyone to the BARK’s First Quarter Fiscal 2023 Ear ...