Newegg(US:NEGG)2024-08-29 00:36Financial Performance - Net sales decreased 14.5% to $618.1 million for the six months ended June 30, 2024, compared to $723.2 million for the same period in 2023[3] - Gross merchandise value (GMV) decreased 15.4% to $746.7 million for the six months ended June 30, 2024, compared to $882.5 million for the same period in 2023[3] - Gross profit decreased 22.4% to $63.1 million for the six months ended June 30, 2024, compared to $81.3 million for the same period in 2023[3] - Net loss for Q2 2024 was $24.954 million, an improvement from a net loss of $29.331 million in Q2 2023, representing a reduction of approximately 15%[20] - Total net cash used in operating activities decreased to $63.197 million in Q2 2024 from $74.959 million in Q2 2023, indicating a 15.5% improvement[20] - Gross Merchandise Volume (GMV) for Q2 2024 was $746.7 million, down from $882.5 million in Q2 2023, reflecting a decline of approximately 15.4%[22] - Adjusted EBITDA improved by 29% to $(7.3) million for the six months ended June 30, 2024, compared to $(10.3) million for the same period in 2023[4] - Adjusted EBITDA for Q2 2024 was $(7.3) million, an improvement from $(10.3) million in Q2 2023, showing a reduction in losses of about 29%[23] Customer Metrics - Active customers totaled approximately 1.1 million as of June 30, 2024, a decrease from 1.3 million for the same period in the prior year[5] - Repeat purchase rate was 23.0% as of June 30, 2024, compared to 27.9% for the same period in the prior year[6] Cash and Inventory Management - The company maintained an inventory balance of $132.0 million and a cash balance of $49.7 million as of June 30, 2024[2] - Cash, cash equivalents, and restricted cash at the end of Q2 2024 totaled $53.113 million, slightly up from $52.970 million at the end of Q2 2023[20] - The company reported a decrease in accounts payable by $13.291 million, from $(82.097) million in Q2 2023 to $(95.388) million in Q2 2024[20] - Stock-based compensation expenses decreased to $15.022 million in Q2 2024 from $17.923 million in Q2 2023, a reduction of approximately 16.5%[20] - Borrowings under the line of credit increased to $41.098 million in Q2 2024 from $27.594 million in Q2 2023, indicating a rise of about 48.8%[20] Strategic Initiatives - The company aims to expand its product offerings in server solutions and strengthen vendor relationships to enhance customer value[7] - The company anticipates a rebound in sales during the second half of 2024 as consumers upgrade their devices[2] Cash Flow and Investment Activities - Cash flows from investing activities provided $879 thousand in Q2 2024, a significant recovery from cash used of $(23.278) million in Q2 2023[20] - The company successfully renewed its credit agreement for an additional two-year period, providing borrowing capacity of up to $40 million from April 1 to September 30 and $50 million from October 1 to March 31 for each year during the renewal term[2] Foreign Currency Impact - The company experienced a foreign currency effect on cash of $(886) thousand in Q2 2024, compared to a positive effect of $727 thousand in Q2 2023[20]