textLogic (WISH) - 2023 Q1 - Quarterly Report

Financial Performance - Total revenue for the three months ended March 31, 2023, was $96 million, a decrease from $189 million in the same period of 2022[102]. - Loss from operations for Q1 2023 was $93 million, compared to a loss of $62 million in Q1 2022[122]. - Adjusted EBITDA for Q1 2023 was $(62) million, with an Adjusted EBITDA margin of (65)%, compared to $(40) million and (21)% in Q1 2022[115]. - Free Cash Flow for Q1 2023 was $(92) million, an improvement from $(148) million in Q1 2022[120]. - Revenue decreased by $93 million, or 49%, to $96 million for the three months ended March 31, 2023, compared to $189 million for the same period in 2022[126]. User Metrics - Monthly Active Users (MAUs) decreased approximately 48% year-over-year, from 27 million in Q1 2022 to 14 million in Q1 2023[104][106]. - Last Twelve Months (LTM) Active Buyers decreased approximately 57% year-over-year, from 28 million in Q1 2022 to 12 million in Q1 2023[104][108]. Revenue Breakdown - Marketplace revenue decreased by $68 million, or 65%, to $36 million for the three months ended March 31, 2023, primarily due to lower order volumes and reduced MAUs[127]. - Logistics revenue decreased by $25 million, or 29%, to $60 million for the three months ended March 31, 2023, driven by lower order volumes[128]. - Cost of revenue decreased by $49 million, or 39%, to $76 million for the three months ended March 31, 2023, compared to $125 million for the same period in 2022[129]. - Gross margin decreased to 21% for the three months ended March 31, 2023, down from 34% for the same period in 2022[130]. Expenses - Sales and marketing expenses decreased by $8 million, or 18%, to $37 million for the three months ended March 31, 2023, compared to $45 million for the same period in 2022[131]. - Product development expenses decreased by $15 million, or 23%, to $51 million for the three months ended March 31, 2023, compared to $66 million for the same period in 2022[132]. - General and administrative expenses increased by $10 million, or 67%, to $25 million for the three months ended March 31, 2023, compared to $15 million for the same period in 2022[134]. Cash Position - Cash and cash equivalents and marketable securities as of March 31, 2023, were $627 million[102]. - As of March 31, 2023, the company had cash, cash equivalents, and marketable securities of $627 million, sufficient to meet anticipated cash needs for at least the next 12 months[136]. - As of March 31, 2023, cash, cash equivalents, and marketable securities were primarily held in cash deposits and treasuries, with minimal impact from a 100 basis point interest rate change[155]. Operational Outlook - The company expects losses from operations to continue due to costs related to brand development and market share expansion[97]. - The company is monitoring global financial market volatility, which may adversely affect business and results of operations[98]. - Net cash used in operating activities was $92 million for the three months ended March 31, 2023, primarily driven by a net loss of $89 million[145]. Risk Management - The company has established a foreign currency risk management policy, utilizing natural hedging techniques and short-term foreign currency derivative contracts to manage exposure[156]. - A 10% appreciation or depreciation of the U.S. dollar is not expected to materially affect the company's financial position or results in the near term[158]. - The company does not currently believe inflation has materially affected its business or financial condition, but significant inflationary pressures could impact revenue and consumer purchasing behavior[159].