Grove laborative (GROV)

Search documents
Grove laborative (GROV) - 2025 Q1 - Quarterly Results
2025-05-14 20:40
[Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) Grove reported an 18.7% revenue decline to $43.5 million in Q1 2025, with Adjusted EBITDA swinging from positive $1.9 million to negative $1.6 million, and an amended Asset-Based-Loan Facility Q1 2025 Key Financial Results vs. Q1 2024 | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $43.5 million | $53.5 million | -18.7% | | Net Loss | $3.5 million | $3.4 million | +$0.1M | | Adjusted EBITDA | $(1.6) million | $1.9 million | -$3.5M | - The company's eCommerce platform migration had a negative impact of **$2 to $3 million** on Q1 2025 revenue[6](index=6&type=chunk) - Grove amended its Asset-Based-Loan Facility, increasing availability and extending the maturity to April 2028[6](index=6&type=chunk)[11](index=11&type=chunk) [CEO's Remarks](index=1&type=section&id=CEO%27s%20Remarks) The CEO expressed dissatisfaction with Q1 performance, noting the turnaround is slower than expected, yet highlighted internal progress in conversion rates and order economics expected to drive second-half momentum and long-term growth - The CEO is not satisfied with Q1 performance and stated the company's turnaround is taking longer than expected[3](index=3&type=chunk) - Despite the revenue decline, the company is observing positive internal trends such as **stronger first order conversion rates** and **better order economics**[4](index=4&type=chunk) - Management believes these foundational improvements will drive **momentum in the back half of the year** and set the stage for **long-term growth**[4](index=4&type=chunk) [First Quarter 2025 Financial Results](index=1&type=section&id=First%20Quarter%202025%20Financial%20Results) Q1 2025 revenue declined 18.7% to $43.5 million due to lower repeat orders and platform migration, resulting in a net loss of $3.5 million and negative Adjusted EBITDA of $1.6 million, with cash and equivalents decreasing to $13.5 million - Revenue declined **18.7% YoY** to **$43.5 million**, driven by lower repeat order volume and temporary disruptions from the eCommerce platform migration, which negatively impacted revenue by an estimated **$2.0 to $3.0 million**[5](index=5&type=chunk) - Gross Margin fell to **53.0%** from **55.5% YoY**, mainly due to the elimination of certain customer fees and a reduced benefit from selling previously reserved inventory[7](index=7&type=chunk) - Operating Expenses decreased by **12.2%** to **$26.6 million**, driven by lower stock-based compensation and fulfillment costs, though partially offset by higher advertising spend[8](index=8&type=chunk) - Cash, Cash Equivalents, and Restricted Cash decreased from **$24.3 million** to **$13.5 million** during the quarter, reflecting negative operating cash flow and cash used for the acquisitions of Grab Green and 8Greens[10](index=10&type=chunk) [First Quarter 2025 Key Metrics](index=2&type=section&id=First%20Quarter%202025%20Key%20Metrics) Key direct-to-consumer metrics in Q1 2025 showed declines, with Total Orders falling 20.0% to 622,000 and Active Customers decreasing 16.0% to 678,000, while Plastic Intensity improved to 0.99 pounds per $100 of revenue Q1 2025 Key DTC Metrics vs. Q1 2024 | Metric (in thousands, except per order data) | Q1 2025 | Q1 2024 | YoY Change | | :--- | :--- | :--- | :--- | | DTC Total Orders | 622 | 773 | -20.0% | | DTC Active Customers | 678 | 807 | -16.0% | | DTC Net Revenue Per Order | $66.49 | $66.27 | +0.3% | - The decline in DTC Total Orders and Active Customers was primarily driven by lower advertising spend in 2024 and temporary disruptions from the eCommerce platform migration[12](index=12&type=chunk)[13](index=13&type=chunk) - Plastic Intensity, a measure of pounds of plastic per $100 in net revenue, improved to **0.99 pounds** in Q1 2025 from **1.08 pounds** in Q1 2024[14](index=14&type=chunk) [Financial Outlook](index=3&type=section&id=Financial%20Outlook) The company revised its full-year 2025 guidance, projecting revenue to decline by mid-single-digit to low-double-digit percentages and Adjusted EBITDA to range from negative low single-digit millions to positive low single-digit millions, with Q1 expected as the lowest revenue quarter Full-Year 2025 Revised Guidance | Metric | FY 2025 Outlook | | :--- | :--- | | Revenue | Decline of mid-single-digit to low double-digit % YoY | | Adjusted EBITDA | Negative low single-digit millions to positive low single-digit millions | - The company expects Q1 2025 to be the **lowest revenue quarter**, with improvement through Q2 and Q3, leading to **slight YoY growth in Q4**[19](index=19&type=chunk) - The outlook incorporates the impact of the eCommerce platform migration and assumes the company can mitigate most of the impact from tariffs through pricing, supplier renegotiations, and sourcing shifts[16](index=16&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) This section presents Grove Collaborative Holdings, Inc.'s unaudited consolidated financial statements, including Balance Sheets, Statements of Operations, and Statements of Cash Flows, for periods ending March 31, 2025 [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheets (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$59,838** | **$65,010** | | Cash and cash equivalents | $9,605 | $19,627 | | Inventory | $22,039 | $19,351 | | **Total Liabilities** | **$46,714** | **$48,787** | | Accounts payable | $8,392 | $6,800 | | **Total stockholders' deficit** | **$(11,648)** | **$(8,549)** | [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) Consolidated Statements of Operations (in thousands) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Revenue, net | $43,547 | $53,545 | | Gross profit | $23,064 | $29,740 | | Operating loss | $(3,508) | $(533) | | **Net loss** | **$(3,547)** | **$(3,391)** | | Net loss per share | $(0.10) | $(0.10) | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows (in thousands) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(6,872) | $(12,380) | | Net cash used in investing activities | $(3,389) | $(518) | | Net cash used in financing activities | $(536) | $(381) | | **Net decrease in cash** | **$(10,797)** | **$(13,279)** | | Cash at end of period | $13,507 | $81,584 | [Non-GAAP Financial Measures](index=4&type=section&id=Non-GAAP%20Financial%20Measures) The company uses non-GAAP measures like Adjusted EBITDA and Adjusted EBITDA margin to supplement GAAP results, with Q1 2025 Adjusted EBITDA at negative $1.6 million (-3.7% margin), a decline from positive $1.9 million (3.5% margin) in Q1 2024 Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net loss** | **$(3,547)** | **$(3,391)** | | Stock-based compensation | $969 | $3,113 | | Depreciation and amortization | $378 | $2,201 | | Interest expense | $346 | $4,129 | | Restructuring and severance related costs | $— | $(2,885) | | Transaction related costs | $563 | $— | | **Total Adjusted EBITDA** | **$(1,598)** | **$1,893** | | **Net loss margin** | **(8.1)%** | **(6.3)%** | | **Adjusted EBITDA margin** | **(3.7)%** | **3.5%** | - Grove defines Adjusted EBITDA as net loss adjusted for items including stock-based compensation, depreciation & amortization, changes in fair values of derivative liabilities, interest, restructuring costs, transaction costs, and taxes[25](index=25&type=chunk)
Grove laborative (GROV) - 2025 Q1 - Earnings Call Presentation
2025-05-14 20:26
Financial Performance & Outlook - Q1 2025 revenue reached $43.5 million, a decrease of 18.7% year-over-year [18] - The company experienced a negative adjusted EBITDA of $1.6 million, representing -3.6% of revenue, compared to a positive $1.9 million, or 3.5% of revenue, in the same period last year [18] - Grove anticipates sequential revenue growth in Q2 and Q3 of 2025, with a return to slight year-over-year growth in Q4 [19] - Full-year 2025 revenue is projected to decline by mid-single-digit to low double-digit percentage points year-over-year [35] - The company expects full-year 2025 adjusted EBITDA to range from negative low single-digit millions to positive low single-digit millions [35] Strategic Initiatives & Transformation - Grove is shifting its business model away from default subscriptions, which is expected to result in higher lifetime value (LTV) and improved payback [27] - The company is expanding its product mix through third-party expansion, owned brand innovation, and mergers and acquisitions (M&A) [62] - Grove aims to increase its assortment by 40% in 2025 by adding over 100 brands [71] Key Achievements in 2024 - Grove achieved a positive adjusted EBITDA of $1.3 million in fiscal year 2024 [8, 58] - The company experienced positive operating cash flow in the last three quarters of 2024 [8] - Grove successfully paid off $72 million in term debt [8, 58]
Grove laborative (GROV) - 2024 Q4 - Annual Report
2025-03-19 20:29
Revenue Performance - Total revenue for 2024 was $203,425,000, down 22% from $259,278,000 in 2023, primarily due to a decrease in DTC Total Orders[324]. - Revenue from Grove Brands was $82,942,000 in 2024, down from $119,006,000 in 2023, indicating a decrease of about 30.3%[450]. - Revenue from third-party products decreased to $120,483,000 in 2024 from $140,272,000 in 2023, reflecting a decline of approximately 14.1%[450]. - For the year ended December 31, 2024, total revenue decreased to $203,425,000 from $259,278,000 in 2023, representing a decline of approximately 21.5%[450]. Customer Metrics - Total DTC orders decreased to 2,930 in 2024 from 3,852 in 2023, primarily due to reduced advertising spend[300]. - DTC active customers declined to 688 in 2024 from 920 in 2023, reflecting fewer new customer acquisitions[301]. - DTC net revenue per order increased to $67 in 2024 from $64 in 2023, attributed to a higher number of products sold per order[302]. Financial Losses and Deficits - Net loss for the year ended December 31, 2024, was $27,423,000, a decrease from a net loss of $43,232,000 in 2023, resulting in a net loss margin improvement from (16.7)% to (13.5)%[307]. - The company reported an accumulated deficit of $648.5 million as of December 31, 2024[283]. - Net loss attributable to common stockholders for 2024 was $28,272 million, compared to a net loss of $44,422 million in 2023, indicating a reduction in losses[400]. Cash Flow and Liquidity - As of December 31, 2024, the company had $19.6 million in unrestricted cash and cash equivalents, with negative cash flow from operating activities of $9.7 million for the year[337]. - Cash and cash equivalents decreased to $19.627 million in 2024 from $86.411 million in 2023, representing a decline of 77.3%[398]. - Cash used in operating activities for 2024 was $9.749 million, compared to $7.993 million in 2023, indicating an increase in cash outflow[406]. Expenses and Cost Management - Gross profit decreased by $28,011,000, or 20%, to $109,348,000 in 2024, while gross margin improved to 54% from 53% in 2023[326][327]. - Advertising expenses decreased by $11,027,000, or 52%, to $10,265,000 in 2024, reflecting a lower-spend strategy for customer acquisition[328]. - Selling, general and administrative expenses decreased by $31.8 million, or 24%, to $103.2 million for the year ended December 31, 2024, compared to $134.9 million in 2023[331]. Restructuring and Strategic Changes - The company recorded restructuring charges of $2.0 million in 2024 and $3.8 million in 2023 related to workforce and facility reductions[285]. - The exit from brick-and-mortar retail is anticipated to improve profitability with minimal revenue impact, expected to be completed by 2025[282]. - The company has exited brick-and-mortar retail channels, expecting minimal impact on financial results[309]. Product Development and Innovation - The company has launched over 500 individual products in recent years, focusing on product innovation and sustainable packaging[288]. - Product development expenses increased by $2,055,000, or 13%, to $18,456,000 in 2024, driven by higher severance-related expenses and accelerated software amortization[329]. Debt and Financing - Total outstanding indebtedness was $7.5 million as of December 31, 2024, after using $72.3 million to repay the Structural Debt Facility in full during the year[337]. - The company entered into a subscription agreement with Volition Capital on September 20, 2024, receiving gross proceeds of $15.0 million in exchange for 15,000 shares of Series A' Redeemable Convertible Preferred Stock[339]. - Interest expense decreased to $12,777,000 in 2024 from $16,077,000 in 2023, with expectations for further decline following the repayment of term debt[322][317]. Inventory and Assets - Inventory decreased by $12.5 million in 2024, contributing to changes in operating assets and liabilities[353]. - Total assets decreased to $65.010 million in 2024 from $150.742 million in 2023, a reduction of 56.8%[398]. - The company had enforceable and legally binding inventory purchase commitments of $9.1 million due within one year as of December 31, 2024[345]. Compliance and Reporting - The Company adopted ASU 2023-07 for segment reporting beginning January 1, 2024, which enhances segment disclosures but did not impact consolidated financial results[472]. - The Company is evaluating the impact of ASU 2023-09, effective for fiscal years starting after December 15, 2024, which requires additional income tax disclosures[473]. - The company remains classified as an "emerging growth company" and a "smaller reporting company," allowing it to take advantage of reduced disclosure obligations[380][381].
Grove laborative (GROV) - 2024 Q4 - Earnings Call Transcript
2025-03-11 23:40
Financial Data and Key Metrics Changes - In Q4 2024, revenue was $49.5 million, up 2.5% from Q3 but down 17.4% year-over-year, marking the first sequential revenue growth since early 2022 [31][14][6] - The company achieved positive operating cash flow of $0.3 million in Q4, marking the third consecutive quarter of positive cash flow [12][40] - Adjusted EBITDA was negative $1.6 million, a negative margin of 3.3%, compared to breakeven in Q3 and $0.1 million in Q4 2023 [40][12] Business Line Data and Key Metrics Changes - The company experienced a sequential increase in total orders, reaching 717,000, up 1.3% quarter-over-quarter but down 17% year-over-year [33] - Direct-to-consumer (DTC) net revenue per order was $66.94, down 0.1% from Q3 and flat year-over-year [34] - Grove brand products accounted for 40.1% of net revenue, up 160 basis points from Q3 but down 470 basis points year-over-year [35] Market Data and Key Metrics Changes - Active customers declined by 3.1% quarter-over-quarter to 688,000 and 25.2% year-over-year [33] - The company expanded its third-party category offerings by 30% compared to Q4 2023, reflecting a commitment to customer needs [17] Company Strategy and Development Direction - The company is focusing on profitability, balance sheet strength, and revenue growth, having eliminated $72 million in term debt [11][12] - A strategic shift to a more flexible, incentive-driven online experience is underway, moving away from a gated subscription model [16] - The company plans to exit the brick-and-mortar business by mid-2025, which is expected to strengthen the bottom line [47] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the trajectory for 2025, expecting to return to year-over-year revenue growth by Q4 2025 [15] - The company anticipates that the first quarter of 2025 will be the lowest revenue quarter, with improvements expected in subsequent quarters [45] - Management emphasized the importance of human health in their branding and marketing strategies moving forward [60][62] Other Important Information - The company announced two strategic acquisitions: Grab Green and 8Greens, which align with its mission of sustainability and health [20][21] - The transition to Shopify's e-commerce platform is expected to unlock efficiencies and capabilities previously limited by their custom-built platform [19] Q&A Session Summary Question: What drove the higher repeat order rates in Q4? - Management attributed the increase to improvements in the core customer experience and a broader third-party assortment, which made it easier for customers to find products [52][54] Question: Can you discuss the pipeline for third-party assortment in 2025? - Management confirmed a focus on expanding into new categories, particularly wellness, while maintaining high product quality standards [56][58] Question: What are the plans for branding and marketing campaigns this year? - Management indicated a shift towards consistent messaging around human health, alongside ongoing sustainability efforts [60][62] Question: Can you provide insights on gross margins and operating expenses for this year? - Management noted that there will be both accretive and dilutive impacts on gross margins, and they will remain disciplined in managing expenses until consistent revenue growth is achieved [64][68]
Grove laborative (GROV) - 2024 Q4 - Annual Results
2025-03-11 20:39
Revenue Performance - Fourth quarter 2024 revenue was $49.5 million, a sequential increase of 2.5% from $48.3 million in Q3 2024, but a year-over-year decline of 17.3% from $59.9 million in Q4 2023[4] - Full year 2024 revenue totaled $203.4 million, representing a 21.5% year-over-year decline, primarily due to a decrease in direct-to-consumer (DTC) orders[17] - For the year ended December 31, 2024, Grove reported a net revenue of $203.425 million, a decrease of 21.5% compared to $259.278 million in 2023[40] Profitability and Loss - Net loss for Q4 2024 was $12.6 million, with a net loss margin of (25.5%), compared to a net loss of $1.3 million in Q3 2024[8] - The net loss for the year ended December 31, 2024, was $27.423 million, compared to a net loss of $43.232 million in 2023, representing a 36.3% improvement[40] - Net loss for the three months ended December 31, 2024, was $12.635 million, compared to a net loss of $9.485 million for the same period in 2023[44] Adjusted EBITDA - Adjusted EBITDA for Q4 2024 was negative $1.6 million, compared to breakeven in Q3 2024 and $0.1 million in Q4 2023[9] - Total Adjusted EBITDA for the year ended December 31, 2024, was $1.301 million, a significant improvement from a loss of $9.183 million in 2023[44] - Adjusted EBITDA margin for the three months ended December 31, 2024, was (3.3)%, compared to 0.2% in the same period of 2023[44] Operating Expenses - Operating expenses in Q4 2024 were $34.3 million, a 6.0% increase sequentially but a 15.4% decrease year-over-year[7] - Operating expenses for the year ended December 31, 2024, totaled $132.895 million, compared to $172.622 million in 2023, a decrease of 23%[40] Balance Sheet and Cash Flow - The company completed a voluntary $72 million repayment of term debt in Q4 2024, improving its balance sheet[5] - The total current assets decreased from $124.196 million in 2023 to $44.941 million in 2024, a decline of 63.8%[38] - Total liabilities decreased from $132.620 million in 2023 to $48.787 million in 2024, a reduction of 63.3%[38] - Cash and cash equivalents at the end of the period were $19.627 million, down from $86.411 million in 2023, a decrease of 77.3%[38] Gross Margin - Gross margin for Q4 2024 was 52.4%, down from 53.0% in Q3 2024 and 54.4% in Q4 2023, attributed to increased promotional activity[5] - The company’s gross profit for the year ended December 31, 2024, was $109.348 million, down from $137.359 million in 2023, reflecting a decline of 20.4%[40] Direct-to-Consumer Orders - DTC total orders in Q4 2024 were 717,000, up 1.3% quarter-over-quarter but down 17.0% year-over-year[14] Future Outlook - The company expects 2025 revenue to be approximately flat to down mid-single digit percentage year-over-year, with a focus on sustainable growth[31] - Recent acquisitions of Grab Green and 8Greens are expected to enhance the company's product offerings and align with its sustainability goals[22] Management Commentary - Grove's management emphasizes the importance of non-GAAP measures like Adjusted EBITDA for evaluating financial performance and trends, despite their limitations[35]
Grove laborative (GROV) - 2024 Q3 - Quarterly Report
2024-11-13 21:54
Financial Performance - Revenue for the three months ended September 30, 2024, was $48.28 million, a decrease of 22% compared to $61.75 million for the same period in 2023[13]. - Gross profit for the three months ended September 30, 2024, was $25.60 million, down from $33.23 million in the prior year, reflecting a gross margin decline[13]. - Operating loss for the three months ended September 30, 2024, was $(6.75) million, compared to $(4.10) million for the same period in 2023[13]. - Net loss attributable to common stockholders for the three months ended September 30, 2024, was $(1.51) million, compared to a net loss of $(10.87) million in the prior year[13]. - The net loss for the three months ended September 30, 2023, was $33.7 million, compared to a net loss of $14.8 million for the same period in 2024[21]. - The company reported a net loss of $1,336,000 for the three months ended September 30, 2024, compared to a net loss of $9,811,000 in the same period of 2023[172]. - Adjusted EBITDA for the nine months ended September 30, 2024, was $2,919,000, compared to a loss of $9,320,000 in the same period of 2023, indicating improved operational performance[172]. Cash and Liquidity - Cash and cash equivalents decreased to $50.8 million as of September 30, 2024, down from $86.1 million in the previous year[24]. - Total cash, cash equivalents, and restricted cash at the end of the period was $55.6 million, down from $94.7 million a year earlier[24]. - As of September 30, 2024, the company had $50.8 million in unrestricted cash and cash equivalents, with negative cash flows from operating activities of $10.0 million for the nine months ended September 30, 2024[205]. - The company has an accumulated deficit of approximately $635.9 million as of September 30, 2024, funded primarily through stock financings and debt[205]. - Total outstanding indebtedness was $32.2 million, net of debt issuance costs, as of September 30, 2024[205]. Expenses and Cost Management - Advertising expenses for the three months ended September 30, 2024, were $2.82 million, while product development expenses were $4.80 million[13]. - The company incurred stock-based compensation expenses of $11.9 million in Q3 2023, compared to $9.3 million in Q3 2024[21]. - Selling, general and administrative expenses decreased from $29.7 million in 2023 to $24.7 million in 2024 for the three months ended September 30[187]. - Interest expense for the three months ended September 30, 2024, was $2.9 million, down from $4.1 million in 2023[183]. - The company has implemented significant expense reductions since the second half of 2022, particularly in advertising, which have led to a substantial decline in revenue[151]. Revenue Breakdown - Grove Brands revenue for the three months ended September 30, 2024, was $18.61 million, down 33% from $27.65 million in the same period of 2023[54]. - Third-party products revenue for the three months ended September 30, 2024, was $29.67 million, a decline of 13% from $34.10 million in the same period of 2023[54]. - Grove Brands % Net Revenue decreased from 46% in September 2023 to 41% in September 2024, reflecting a shift towards third-party offerings[164]. Future Outlook and Strategy - Future outlook remains cautious due to potential risks and uncertainties affecting operations and financial performance[6]. - The company plans to continue focusing on product development and market expansion strategies to drive future growth[6]. - The company plans to exit the sale of Grove Co. products through brick and mortar retail channels by 2025, expecting minimal impact on revenue but improved profitability[145]. - The company is transitioning its ecommerce platform to Shopify, which is expected to enhance scalability and user experience[161]. - Operating expenses are expected to increase as the company plans to invest more in advertising to optimize customer acquisition costs[179]. Debt and Financing - The total debt as of September 30, 2024, is $32.166 million, a decrease from $71.662 million as of December 31, 2023[78]. - The Company entered into a revolving line of credit (Siena Revolver) with an initial commitment of $35.0 million, with an outstanding principal balance of $7.5 million as of September 30, 2024[86][89]. - The interest rate on the outstanding balance of the Siena Revolver was 9.18% as of September 30, 2024, with additional borrowing capacity of $6.8 million[89]. - The Company must prepay $10.0 million of the principal amount on the Structural Debt Facility on or before November 30, 2024[85]. Stock and Equity - The Company had cash equivalents of $48.514 million as of September 30, 2024, down from $83.431 million as of December 31, 2023[69]. - The Company has 29,028,103 shares of common stock reserved for future issuance as of September 30, 2024, including various warrants and stock options[118]. - The Company issued 396,825 shares to HCI Grove LLC for aggregate proceeds of $2.5 million under the HGI Subscription Agreement, with a registration statement filed on July 14, 2023[113]. - The Series A Preferred Stock Subscription Agreement with Volition Capital raised gross proceeds of $10.0 million for 10,000 shares, along with warrants to purchase 1,579,778 shares at an exercise price of $6.33[119]. Operational Metrics - DTC Total Orders decreased from 2,988 in September 2023 to 2,213 in September 2024, primarily due to a lower advertising spend strategy[165]. - DTC Active Customers remained stable at 1,019 in September 2023 but decreased to 710 in September 2024, indicating a decline in customer acquisition[166]. - DTC Net Revenue Per Order increased from $64 in September 2023 to $67 in September 2024, attributed to a favorable product mix and strategic price increases[167].
Grove laborative (GROV) - 2024 Q3 - Earnings Call Transcript
2024-11-13 03:16
Financial Data and Key Metrics Changes - Net revenue for Q3 2024 was $48.3 million, down 7.3% from Q2 2024 and down 21.8% year-over-year, primarily due to fewer repeat orders and lower advertising spend [22][19] - Total orders decreased to 0.7 million in Q3, down 3.3% quarter-over-quarter and 22.8% year-over-year, with active customers also down to 0.7 million, a decline of 4.8% quarter-over-quarter and 30.4% year-over-year [23][19] - Adjusted EBITDA was breakeven in Q3 2024, compared to $1.1 million in Q2 2024 and $0.2 million in Q3 2023, reflecting strict expense discipline despite revenue challenges [30][19] Business Line Data and Key Metrics Changes - DTC net revenue per order was $67.02 in Q3, down 1% from Q2 but up 2.7% year-over-year, driven by a higher percentage of first orders [24][19] - Gross margin was 53%, down 80 basis points from Q2 2024 and year-over-year, mainly due to retail markdowns and a shift towards third-party products [25][19] - Growth brand products as a percentage of net revenue decreased to 38.5%, down 260 basis points quarter-over-quarter and 630 basis points year-over-year, due to the expansion of third-party offerings [26][19] Market Data and Key Metrics Changes - Advertising expenses increased 15.6% in Q3 compared to Q2 but decreased 30.6% year-over-year to $2.8 million, reflecting a strategic shift towards DTC advertising [27][19] - The company reported a $0.8 million operating cash flow, marking the fourth quarter of positive operating cash flow in the last six quarters [31][19] - Inventory was reduced from $27.8 million at the end of Q2 2024 to $24.5 million at the end of Q3 2024, indicating improved inventory management [9][19] Company Strategy and Development Direction - The company is focusing on exiting the retail channel by early 2025, as it constitutes less than 4% of the business and has been consistently unprofitable [16][19] - The strategy emphasizes investment in DTC channels, targeting a growing segment of conscientious consumers who prefer premium curated selections [17][19] - The company aims to achieve sustainable, profitable growth by optimizing its e-commerce experience and enhancing customer engagement [36][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a reduction in revenue guidance for 2024, now expecting net revenue to be in the range of $200 million to $205 million, down from previous guidance [33][19] - The management remains optimistic about sequential revenue growth in Q4 2024, driven by stabilization in repeat customer revenue [22][19] - The company is committed to maintaining strict margin and expense discipline while focusing on long-term sustainable growth [34][19] Other Important Information - The company received an additional $15 million investment from Volition Capital, which will be used to pay off remaining term debt, resulting in a cleaner balance sheet [10][19] - The Grove community has avoided and recovered 24.5 million pounds of plastic since 2020, highlighting the company's commitment to sustainability [14][19] Q&A Session Summary Question: Update on digital transformations and Shopify transition - Management confirmed that sequential growth is still anticipated and that the transition to Shopify is expected to be completed by early Q1 [39][19] Question: Factors needed for sequential growth in Q4 - Management indicated that brick-and-mortar performance has been a headwind, but they expect DTC growth to offset this [40][19] Question: Impact of exiting brick-and-mortar on P&L - Management clarified that while brick-and-mortar has been a challenge, they are focused on achieving profitable growth through DTC channels [42][19] Question: Consumer health heading into the holiday season - Management noted that their DTC customer base is generally higher income, and they have not observed significant trading down to lower-cost items [47][19]
Grove laborative (GROV) - 2024 Q3 - Quarterly Results
2024-11-12 21:18
Financial Performance - Third Quarter 2024 revenue was $48.3 million, a decline of 7.3% sequentially from $52.1 million and a 22.0% decrease year-over-year from $61.8 million[4] - Net revenue for the three months ended September 30, 2024, was $48,280 thousand, down from $61,750 thousand in the same period of 2023, representing a decrease of about 22%[26] - Gross profit for the nine months ended September 30, 2024, was $83,405 thousand, compared to $104,797 thousand for the same period in 2023, a decline of approximately 20.4%[26] - Operating loss for the three months ended September 30, 2024, was $(6,746) thousand, compared to $(4,105) thousand in the same period of 2023, indicating a worsening of 64.3%[26] - Net loss attributable to common stockholders for the three months ended September 30, 2024, was $(1,510) thousand, compared to $(10,869) thousand in the same period of 2023, showing an improvement of approximately 86.1%[26] Margins and Expenses - Gross Margin for the quarter was 53.0%, down from 53.9% in the previous quarter and 53.8% in the same quarter last year[5] - Operating Expenses decreased to $32.3 million, a 7.6% reduction from $35.0 million in the second quarter of 2024 and a 13.4% decrease from $37.3 million in the third quarter of 2023[6] - The company reported an Adjusted EBITDA margin of (0.1)% for the nine months ended September 30, 2024, compared to (4.7)% for the same period in 2023, indicating an improvement[28] - The company incurred stock-based compensation expenses of $9,268 thousand for the nine months ended September 30, 2024, compared to $11,941 thousand for the same period in 2023, a decrease of approximately 22.3%[27] Cash Flow and Assets - Operating Cash Flow was positive at $0.8 million, marking the fourth consecutive quarter of positive operating cash flow[9] - Total current assets decreased from $124,196 thousand in December 2023 to $81,841 thousand in September 2024, a decline of approximately 34.1%[25] - Cash, cash equivalents, and restricted cash at the end of the period decreased to $55,589 thousand from $94,863 thousand at the beginning of the period, a reduction of about 41%[27] - Total liabilities decreased from $132,620 thousand in December 2023 to $78,831 thousand in September 2024, a decline of approximately 40.5%[25] Customer Metrics - Direct-to-Consumer (DTC) Total Orders were 0.7 million, down 3.3% from the previous quarter and 22.8% year-over-year[10] - DTC Active Customers totaled 0.7 million, a decrease of 4.8% quarter-over-quarter and 30.4% year-over-year[10] Strategic Changes - The company revised its full-year 2024 revenue guidance to a range of $200 million to $205 million, down from the previous guidance of $205 million to $215 million[17] - Grove Brands accounted for 38.5% of Net Revenue, down 260 basis points quarter-over-quarter and 630 basis points year-over-year[9] - The company plans to exit the brick-and-mortar retail channel, which has accounted for less than 4% of revenue and has been consistently unprofitable since its launch[14] - The company’s total stockholders' equity decreased from $8,122 thousand in December 2023 to $1,520 thousand in September 2024, a decline of approximately 81.3%[25]
Grove laborative (GROV) - 2024 Q2 - Earnings Call Presentation
2024-08-09 11:18
August 2024 Investor Presentation You're a force of nature. OO Updated Post Q2 2024 Earnings 255 255 255 3 59 76 Safe Harbor Statement/Non-GAAP Measures 247 243 228 0 0 0 247 243 228 102 163 157 3 59 76 0 114 88 130 186 128 172 196 200 120 159 144 NOTES START FROM HERE AND GROW UP Forward-Looking Statements Certain statements included in this presentation are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forwar ...
Grove laborative (GROV) - 2024 Q1 - Earnings Call Transcript
2024-05-18 09:20
Financial Data and Key Metrics Changes - Net revenue in Q1 2024 was $53.5 million, down 10.5% from Q4 2023 and 25.2% year-over-year [6] - Adjusted EBITDA for Q1 2024 was $1.9 million, compared to $0.1 million in Q4 2023 and a loss of $6.9 million in Q1 2023 [42] - The net loss for the quarter was $3.4 million, an improvement from a net loss of $9.5 million in Q4 2023 and $13.1 million in Q1 2023 [42] Business Line Data and Key Metrics Changes - Grove Brands products as a percentage of net revenue decreased by 150 basis points quarter-over-quarter and 580 basis points year-over-year to 43% [7] - DTC net revenue per order was down 0.8% quarter-over-quarter but up 7.5% year-over-year to $66.27 [15] - Total orders were down 10.5% quarter-over-quarter and 29.5% year-over-year to 0.8 million [40] Market Data and Key Metrics Changes - Active customers decreased by 12.3% quarter-over-quarter and 35% year-over-year to 0.8 million [40] - Advertising expense decreased by 47.4% quarter-over-quarter and 36.3% year-over-year to $2.1 million [41] Company Strategy and Development Direction - The company is focused on three pillars: customer, sustainability, and profitability, aiming to transform into a household name for sustainable products [3][11] - The company plans to scale advertising spend in the coming quarters to support revenue growth while improving first order conversion rates [6][19] - The expansion of third-party product offerings increased by 34% year-over-year, with 41% of third-party products enrolled in the subscribe and save program [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving sequential revenue growth by the end of the year and profitability on an adjusted EBITDA basis for the full year [19][43] - The company anticipates improvements in first order conversion rates and plans to increase advertising spend as efficiency improves [41][55] - Management highlighted the importance of sustainability as a differentiator and committed to building a sustainable business [3][38] Other Important Information - The company ended the quarter with $81.6 million in cash, a decrease of $13.3 million from the previous quarter [8] - The company has not drawn on its asset-based loan facility since taking a minimum draw of $7.5 million in Q1 2023 [17] Q&A Session Summary Question: Sales cadence throughout the year - Management indicated they are guiding towards sequential growth this year, believing they are near a bottoming out of unusual comps from heavy marketing spend in 2022 [22] Question: Initial reads on new products and customer acquisition - Management expressed excitement about the new product launches and noted early success, including sold-out items at retail [24] Question: Gross margin expectations for the next few quarters - Management stated that Q1 had one-off factors and emphasized ongoing efforts to improve gross margin without providing specific guidance [26] Question: Future advertising spend - Management confirmed plans to increase advertising spend in the back half of the year, focusing on efficiency and strong paybacks [27] Question: Performance of third-party brands and Grove brand mix - Management noted that third-party brands are growing faster and emphasized that the focus is on customer needs rather than an ideal percentage mix [30]