1stdibs.com(US:DIBS)2024-02-28 16:50Financial Data and Key Metrics Changes - Gross margins expanded from the high 60s to the low 70s despite lower revenue [5] - Adjusted EBITDA margins improved to negative 8.4% in the second half of 2023 from negative 21.7% in the same period of 2022 [5] - Total operating expenses decreased by 19% to $20.1 million, reflecting the benefits of restructuring [24] - Adjusted EBITDA loss was $1.7 million compared to a loss of $4.5 million last year [24] Business Line Data and Key Metrics Changes - GMV for the fourth quarter was $86.4 million, down 17% due to soft demand for luxury home goods [39] - Average order value decreased by 7% to approximately $2,530, while median order value remained flat at approximately $1,150 [22] - Listings increased by 12%, with over 1.7 million listings on the marketplace [40] Market Data and Key Metrics Changes - Active buyers decreased by 10% to approximately 60,700 [40] - Unique sellers increased to approximately 7,800, up from 5,600 a year ago [23] - Traffic declines were observed in both paid and non-paid segments year-over-year [39] Company Strategy and Development Direction - The company is focusing on three themes: personalized buying, competitive inventory pricing, and scalability [6] - A new pricing structure was implemented requiring all new sellers to pay a monthly subscription fee, which is expected to increase engagement [45] - The company aims to optimize the make offer process to enhance conversion and order volumes [19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing economic uncertainty and its impact on consumer behavior, particularly in discretionary spending [42] - There are signs of stabilization in GMV, with expectations for sequential growth in the first quarter of 2024 [50] - The company remains committed to adapting to market dynamics while maintaining cost discipline [8] Other Important Information - The company initiated a $20 million share repurchase program, repurchasing $3.5 million worth of shares since its inception [18] - Technology development expenses decreased by 22% to $4.4 million, driven by lower headcount-related expenses [11] - Interest income increased to approximately $1.7 million, up from $860,000 a year ago [24] Q&A Session Summary Question: Insights on the new pricing structure for sellers - Management noted that new sellers are required to pay a minimum of $99 a month, which is expected to increase engagement and posting activity [45] Question: Highlights of successful new features from AB testing - Management reported a 300% year-over-year increase in the number of tests launched, contributing to conversion growth [47] Question: Signals indicating demand recovery in 2024 - Management expressed optimism about demand stabilization, with sequential GMV expected to remain flat for three consecutive quarters [50] Question: Regional performance differences in demand - Management indicated no significant differences in performance across regions, focusing on conversion improvements [56]