Allbirds(US:BIRD)2025-11-06 22:33Financial Performance - Net revenue for Q3 2025 was $33.0 million, down 23.3% from $43.0 million in Q3 2024; for the nine months ended September 30, 2025, net revenue was $104.8 million, a decrease of 21.7% from $133.9 million in the same period of 2024[145]. - Gross margin for Q3 2025 was 43.2%, compared to 44.4% in Q3 2024; for the nine months ended September 30, 2025, gross margin was 42.7%, down from 47.5% in the same period of 2024[145]. - The company reported a net loss of $20.3 million for Q3 2025, slightly improved from a net loss of $21.2 million in Q3 2024; for the nine months ended September 30, 2025, the net loss was $57.7 million, compared to $67.6 million in the same period of 2024[145]. - Adjusted EBITDA loss for Q3 2025 was $15.7 million, compared to a loss of $16.2 million in Q3 2024; for the nine months ended September 30, 2025, adjusted EBITDA loss was $46.9 million, down from $50.9 million in the same period of 2024[145]. - Net revenue for the three months ended September 30, 2025, was $32.989 million, a decrease of $10.007 million or 23.3% compared to $42.996 million in 2024, primarily due to declines in U.S. direct business and international business[172]. - Gross profit for the same period decreased by $4.834 million or 25.3%, resulting in a gross margin of 43.2%, down from 44.4% in 2024[174][175]. - Net loss for the three months ended September 30, 2025, was $20.324 million, compared to a net loss of $21.177 million in 2024[172]. - Net revenue for the nine months ended September 30, 2025, was $104.787 million, a decrease of $29.118 million or 21.7% compared to $133.905 million in 2024[186]. - The decrease in nine-month net revenue was primarily driven by a $16.6 million decline in U.S. direct business and a $15.5 million decline in international business[186]. - Gross profit decreased by $18.8 million, or 29.6%, to $44.80 million for the nine months ended September 30, 2025, compared to $63.59 million in 2024[188]. - Gross margin declined to 42.7% for the nine months ended September 30, 2025, from 47.5% in 2024, primarily due to a lower percentage of sales from retail business[189]. Operational Changes - As of September 30, 2025, the company operated 23 stores, a reduction from 34 stores as of September 30, 2024, reflecting a strategic optimization of the store fleet[150]. - The company closed 9 stores in the U.S. and 1 store in the U.K. during the first three quarters of 2025, continuing its trend of store closures to enhance operational efficiency[149]. - Total operating expenses for the three months ended September 30, 2025, were $34.126 million, a decrease of $6.731 million or 16.5% compared to $40.857 million in 2024[176]. - Selling, general, and administrative expenses decreased by $9.289 million or 30.0% to $21.678 million, driven by reductions in personnel and occupancy costs[177]. - Marketing expenses increased by $1.864 million or 18.9% to $11.719 million, primarily due to higher digital advertising costs for new product launches[178]. - Total operating expense decreased by $31.3 million, or 23.1%, to $104.04 million for the nine months ended September 30, 2025, compared to $135.37 million in 2024[190]. - Selling, general, and administrative expense decreased by $33.2 million, or 31.8%, to $71.05 million for the nine months ended September 30, 2025[191]. Cash Flow and Financing - As of September 30, 2025, the company had cash and cash equivalents of $23.7 million[207]. - The company entered into a secured $50.0 million revolving credit agreement on June 30, 2025, with the potential to increase borrowing capacity by an additional $25.0 million[209]. - For the nine months ended September 30, 2025, net cash used in operating activities was $51.8 million, consisting of a net loss of $57.7 million, adjusted for non-cash charges of $13.1 million[217]. - During the same period in 2024, net cash used in operating activities was $53.0 million, with a net loss of $67.6 million, offset by non-cash charges of $21.5 million[218]. - Net cash used in investing activities for the nine months ended September 30, 2025, was $1.4 million, primarily due to $2.3 million in capital expenditures[220]. - Net cash provided by financing activities for the nine months ended September 30, 2025, was $9.3 million, primarily from $12.3 million in borrowings on the line of credit[222]. - The Credit Agreement has a maturity date of June 30, 2028, with customary representations and warranties, including restrictions on indebtedness and minimum consolidated EBITDA[212]. Strategic Focus - The company aims to grow brand awareness and customer acquisition through a cost-effective go-to-market strategy, focusing on both U.S. and international markets[146]. - The company emphasizes innovation in sustainable materials as a core part of its product development strategy, which may require ongoing investments and could delay profitability[151]. - Current macroeconomic conditions, including elevated inflation and supply chain disruptions, are expected to impact consumer spending and demand for the company's products[154]. - The company is committed to reducing its carbon footprint and environmental impact, which may lead to higher expenses in the short term[152]. Accounting and Reporting - As of September 30, 2025, there have been no changes to critical accounting estimates affecting the financial statements[225]. - The company is classified as an "emerging growth company" and may take advantage of certain exemptions from reporting requirements until December 31, 2026[227]. - The company reported a net decrease in cash, cash equivalents, and restricted cash of $43.0 million for the nine months ended September 30, 2025[214]. - Interest expense changed from income of $0.744 million in 2024 to an expense of $0.370 million in 2025, a change of $1.114 million or 149.7%[182]. - Interest income decreased by $2.98 million, or 99.7%, to $9, primarily due to a decrease in short-term investments[196]. - Other income decreased by $0.7 million, or 28.7%, to $1.75 million for the nine months ended September 30, 2025[198]. - Impairment expense increased to $0.729 million in the three months ended September 30, 2025, compared to no impairment in the same period in 2024[179].