Beyond(BYON) - 2024 Q1 - Quarterly Results

Q1 2024 Performance Overview Beyond, Inc. initiated a new strategic era in Q1 2024, focusing on a profitable brand portfolio and expense reduction, despite reporting a significant net loss and negative adjusted EBITDA on flat revenue Management Commentary & Strategic Initiatives Management initiated a new strategic era for Beyond, Inc., focusing on building a profitable brand portfolio and reducing annualized expenses by $45 million - The company's vision is to become the 'AAA of Home', offering comprehensive solutions for home-related needs[2] - The core brand portfolio now consists of Bed Bath & Beyond, Overstock, and the newly acquired Zulily, with a plan to relaunch the Zulily site later in the year[2][9] - The iconic Overstock website was soft-launched six months ahead of schedule, showing promising early growth[9] - A strategic shift is underway to focus on acquiring customers with a higher likelihood of repeat behavior, aiming for sustainable growth over transient transactions[10] - The company is halfway through a plan to reduce expenses by $45 million on an annualized basis to create a more variable cost structure[11] Q1 2024 Financial & Operational Highlights Q1 2024 saw strong customer growth and flat revenue, but profitability declined significantly with a $74 million net loss and negative adjusted EBITDA | Metric | Q1 2024 | Change (YoY) | | :--- | :--- | :--- | | Total Net Revenue | $382 million | +0.3% | | Orders Delivered | 2.2 million | +27% | | Active Customers | 6.0 million | +26% | | Gross Profit | $74 million | -27% (Adjusted) | | Operating Loss | $58 million | N/A (vs. $8M loss) | | Net Loss | $74 million | N/A (vs. $10M loss) | | Diluted Net Loss per Share | $1.62 | N/A (vs. $0.23 loss) | | Adjusted EBITDA (non-GAAP) | ($48) million | N/A (vs. $3M profit) | | Cash and Cash Equivalents | $256 million | -32% | Consolidated Financial Statements The consolidated financial statements for Q1 2024 show flat revenue, significant net losses, declining cash and equity, and negative cash flow from operations Consolidated Statements of Operations (Income Statement) Q1 2024 net revenue remained flat at $382 million, but gross profit and net income significantly declined, resulting in a $74 million net loss | (in thousands) | Q1 2024 | Q1 2023 (Adjusted) | | :--- | :--- | :--- | | Net Revenue | $382,281 | $381,140 | | Gross Profit | $74,359 | $101,684 | | Total Operating Expenses | $131,884 | $110,048 | | Operating Loss | $(57,525) | $(8,364) | | Net Loss | $(73,928) | $(10,307) | | Diluted Net Loss per Share | $(1.62) | $(0.23) | - The company changed its accounting presentation to reclassify merchant fees and customer service costs from 'Cost of goods sold' to a separate line item in operating expenses, applied retrospectively without impacting net loss[7][8][14] Consolidated Balance Sheets As of March 31, 2024, cash and total assets decreased, while total liabilities increased, leading to a significant decline in stockholders' equity | (in thousands) | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $256,323 | $302,605 | | Total current assets | $305,444 | $350,073 | | Total Assets | $577,258 | $635,818 | | Total current liabilities | $245,875 | $232,395 | | Total Liabilities | $289,511 | $276,686 | | Total Stockholders' Equity | $287,747 | $359,132 | Consolidated Statements of Cash Flows In Q1 2024, the company used $34.6 million in cash from operating activities, resulting in a net decrease of $46.3 million in cash and equivalents | (in thousands) | Three months ended March 31, 2024 | Three months ended March 31, 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(34,610) | $20,007 | | Net cash used in investing activities | $(9,126) | $(14,831) | | Net cash used in financing activities | $(2,519) | $(1,705) | | Net decrease in cash | $(46,255) | $3,471 | | Cash, end of period | $256,494 | $374,928 | Key Metrics and Non-GAAP Measures Key operational metrics show increased active customers but decreased spending efficiency, while non-GAAP measures indicate significant losses and negative free cash flow Supplemental Operational Data Q1 2024 operational data shows a 26% increase in active customers, but a decline in average order value and revenue per active customer | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Active customers (thousands) | 6,041 | 4,795 | | LTM net revenue per active customer | $259 | $370 | | Orders delivered (thousands) | 2,211 | 1,736 | | Average order value | $173 | $220 | | Orders per active customer (LTM) | 1.41 | 1.57 | - Key operational metrics are defined as follows: - Active customers: Unique customers with at least one purchase in the prior twelve months - Average order value (AOV): Total net revenue divided by total orders delivered in a period - Orders per active customer: Total orders delivered in a twelve-month period divided by active customers[21][22][41] Non-GAAP Financial Measures & Reconciliations Non-GAAP measures for Q1 2024 show a significant decline, with adjusted EBITDA at negative $47.8 million and free cash flow at negative $38.0 million Reconciliation of Net Loss to Adjusted EBITDA | (in thousands) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net loss | $(73,928) | $(10,307) | | Adjustments | $26,085 | $13,723 | | Adjusted EBITDA | $(47,843) | $3,416 | Reconciliation of Diluted EPS to Adjusted Diluted EPS | Per Share Data | Q1 2024 | | :--- | :--- | | Diluted Net Loss per Share (GAAP) | $(1.62) | | Loss from equity method securities | $(0.40) | | Adjusted Diluted Loss per Share (Non-GAAP) | $(1.22) | Free Cash Flow Calculation | (in thousands) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash from operating activities | $(34,610) | $20,007 | | Expenditures for property and equipment | $(3,422) | $(5,256) | | Free Cash Flow | $(38,032) | $14,751 |