Allbirds Stock May Fall As Retail Bankruptcies Rose 80% In 2024

Core Insights - Allbirds is forecasting a 25% decline in revenue for the full year, projecting revenue to be around $190 million and an adjusted EBITDA loss of$73 million, which is an improvement of $24 million from 2023 [3] - The company reported a 25$43 million in Q3 2024, alongside a net loss of $21.2 million, and burned through$11 million in cash during the quarter [11] - Analysts express mixed views on Allbirds' future, with some believing that the company needs to grow revenue rather than just cut costs to achieve profitability [4][5] Financial Performance - Allbirds' Q3 2024 financial performance showed a significant decline, with net revenue falling to $43 million and a net loss of$21.2 million [11] - The company is holding $79 million in cash and equivalents at the end of Q3, indicating a need for careful cash management moving forward [11] - The forecast for the full year indicates a significant adjusted EBITDA loss of$73 million, reflecting ongoing financial challenges [3] Market Position and Strategy - The new CEO, Joe Vernachio, aims to reintroduce the Allbirds brand and reinforce its aspirational position in the market [20] - Analysts are skeptical about Allbirds' ability to attract consumers who prioritize sustainable materials over design and style [4] - The company is developing new products, such as the Tree Glider and slip-on Lounger Lift, which have received positive consumer feedback [8] Industry Trends - Retail bankruptcies and store closures are on the rise, with 7,100 stores closed in 2024, a 69% increase from the previous year, and 45 retailers filing for bankruptcy, an 80% increase from 2023 [21] - The competitive landscape is shifting, with consumers increasingly seeking value, leading to challenges for retailers like Allbirds that may not be meeting these expectations [14][17]