1stdibs.com(US:DIBS)2023-05-10 16:00Financial Performance - Gross Merchandise Value (GMV) for Q1 2023 was $97.1 million, a decrease of 17.4% from $117.5 million in Q1 2022[96]. - Net revenue for Q1 2023 was $22.2 million, down 17% from $26.6 million in Q1 2022, primarily due to a decrease in seller marketplace services revenue[111]. - Adjusted EBITDA for Q1 2023 was a loss of $5.3 million, compared to a loss of $4.7 million in Q1 2022[96]. - Net loss for Q1 2023 was $8.1 million, compared to a net loss of $6.4 million in Q1 2022[110]. - Gross profit for Q1 2023 was $14.9 million with a gross margin of 67.1%, down from $18.9 million and 71.1% in Q1 2022, primarily due to increased software amortization and a decrease in net revenue[114]. Operational Metrics - Number of Orders decreased to 35,385 in Q1 2023 from 39,392 in Q1 2022, reflecting a decline of 10.4%[96]. - Active Buyers decreased to 66,400 in Q1 2023 from 71,311 in Q1 2022, a reduction of 6.9%[96]. - Marketplace transaction fees accounted for 72% of net revenue in Q1 2023, compared to 70% in Q1 2022[112]. Expenses and Costs - Cost of revenue decreased to $7.3 million in Q1 2023 from $7.7 million in Q1 2022, a decline of 5%[113]. - Total operating expenses for Q1 2023 were $25.1 million, slightly down from $25.6 million in Q1 2022[110]. - Sales and marketing expenses decreased by $2.0 million or 17% to $9.8 million in Q1 2023, compared to $11.8 million in Q1 2022, driven by reduced discretionary spending[115]. - General and administrative expenses increased by $1.7 million or 26% to $8.1 million in Q1 2023, primarily due to higher legal fees and stock-based compensation[117]. - Provision for transaction losses decreased by $0.3 million or 19% to $1.4 million in Q1 2023, compared to $1.7 million in Q1 2022, attributed to a decline in GMV[118]. Cash Flow and Investments - As of March 31, 2023, the company had cash, cash equivalents, and short-term investments totaling $150.5 million, with an accumulated deficit of $299.2 million[125]. - Net cash used in operating activities was $2.8 million in Q1 2023, an improvement from $6.2 million in Q1 2022, driven by changes in operating assets and liabilities[130]. - Net cash used in investing activities surged to $62.8 million in Q1 2023, primarily due to purchases of short-term investments[131]. Future Outlook - The company anticipates that net revenue will no longer include software services following the sale of Design Manager in June 2022[101]. - The company expects to continue incurring substantial expenditures to support growth initiatives and may need to raise additional capital to meet long-term objectives[126]. Market Conditions - Inflation and macroeconomic factors have negatively impacted GMV and net revenue, with potential inability to offset higher costs through revenue increases[143]. - Net revenue is primarily denominated in U.S. dollars, Euros, and British pounds, with a potential $0.8 million change in revenue from a 10% fluctuation in exchange rates as of March 31, 2023[141]. - No single customer accounted for more than 10% of net revenue for the three months ended March 31, 2023 and 2022, mitigating credit risk[142]. Other Income - Other income increased significantly by $1.7 million or 452% to $2.0 million in Q1 2023, mainly due to higher interest income from cash equivalents and short-term investments[119].