Beyond(US:BYON)2024-02-22 16:00Financial Performance - Net revenue for the year ended December 31, 2023, was $1,561.1 million, a decrease of 19.1% compared to $1,929.3 million in 2022[23] - Gross profit decreased by 29.2% to $314.0 million in 2023, with a gross margin of 20.1%, down from 23.0% in 2022[33] - The company reported a net cash used in operating activities of $18.6 million for the year ended December 31, 2023, compared to $12.5 million in 2022[36] - Cash used in investing activities was $44.6 million in 2023, primarily due to purchases of intangible assets and expenditures for property and equipment[19] - The company reported a $96.2 million decrease in other income (expense), net for the year ended December 31, 2023, primarily due to a $76.5 million increase in losses from equity method securities[63] - As of December 31, 2023, the company reported an accumulated deficit of $481.7 million, with significant losses incurred in 2022 and 2023, including non-cash losses on equity method investments and a write-down on corporate headquarters[173] Operating Expenses - Operating expenses increased, with sales and marketing expenses rising to 14.4% of revenue in 2023, up from 11.2% in 2022[15] - For the year ended December 31, 2023, general and administrative expenses increased by $10.7 million to $90.4 million, representing a year-over-year percentage change of 13.4%[49] - Sales and marketing expenses as a percentage of net revenues increased by 320 basis points for the year ended December 31, 2023, primarily due to higher performance marketing expenses[46] - Technology expenses decreased by $4.0 million for the year ended December 31, 2023, compared to the same period in 2022, mainly due to reduced staff-related expenses[48] Market and Economic Conditions - The company continues to monitor macroeconomic trends that may impact consumer confidence and spending, but liquidity remains stable as of December 31, 2023[34] - Economic conditions such as recession, inflation, and weakness in the U.S. housing market could decrease consumer discretionary spending, negatively affecting sales of home-related products[169] - Inflationary pressures have impacted various parts of the business, and the company is actively monitoring these effects to minimize their impact on customers[69] Strategic Initiatives - The company acquired the Bed Bath & Beyond brand and related intellectual property in July 2023, which is expected to enhance market presence[31] - The company has established strategic partnerships with third-party manufacturers, distributors, and suppliers to ensure a reliable supply chain[111] - The company changed its corporate name from Overstock.com, Inc. to Beyond, Inc. in November 2023 and transferred its stock listing to the New York Stock Exchange[100] - The common stock began trading under the ticker symbol "BYON" on November 6, 2023, after ceasing to trade under "OSTK" on November 3, 2023[100] Customer Engagement and Experience - The company emphasizes a user-friendly interface and personalized customer experience through its mobile app and dedicated customer care team[111] - The Welcome Rewards Loyalty Program enhances customer engagement and retention, adding value to the overall customer experience[111] - The average order value decreased by 16%, and the number of customer orders delivered fell by 4% in 2023 compared to 2022[41] Workforce and Human Capital - The company has approximately 830 full-time employees as of December 31, 2023, with a strong focus on human capital management to drive business success[149] - The average tenure of employees is six and a half years, with six years in customer service and warehouse departments, indicating a stable workforce[143] - The company emphasizes diversity and inclusion as a competitive advantage, aiming to increase team diversity at all levels and foster an inclusive work environment[150] - The company offers a competitive benefits package, including a 401(k) matching program of dollar for dollar up to 6% of employee savings, and has expanded benefits to include flexible work schedules[140][154] Risks and Challenges - The company is exposed to market risks from interest rate changes, foreign currency fluctuations, and changes in the market values of investments[67] - The company faces intense competition from various online and traditional retailers, including Amazon, Walmart, and specialty furniture retailers, which could adversely impact its market position and financial performance[181] - The company relies heavily on third-party companies for critical functions, and any failure or increased costs from these partners could materially affect financial results and business prospects[165] - Cybersecurity risks and data breaches pose significant threats, potentially leading to legal claims and reputational damage[206] Regulatory and Compliance Issues - The company is subject to various regulations that may impact its growth and operational expenses, including those related to e-commerce and financial products[122] - The SEC has proposed new rules that could increase business costs and compliance risks related to climate change disclosures[192] - The company has received multiple subpoenas from the SEC regarding insider trading policies and communications with executives[195] Investment and Securities - The carrying amount of equity method securities was reported at $155.9 million as of December 31, 2023, with valuation sensitive to changes in enterprise value assumptions[76] - The company holds equity method investments totaling approximately $155.9 million, which are inherently risky and may lead to future losses that could adversely affect financial results[190] - The company holds $41.0 million in equity securities and $10.5 million in debt securities from private companies, recorded at fair value using Level 3 inputs[83] Future Outlook - The company is currently marketing its corporate headquarters for sale, which could lead to changes in operational structure and remote work policies[172] - Changes in the leadership team and workforce, including a reduction in force and a shift to performance-based compensation, could impact employee engagement and retention, affecting business operations[172]