Bed,Bath & Beyond parent Q1 loss widens but active customers jump

Beyond, Inc. reported top-and bottom-line first-quarter results that missed estimates amid plans to invest in attracting more repeat customers.

The parent company of Overstock, Bed Bath & Beyond and Zulily reported a net loss of $72.2 million, or $1.58 per diluted share, for the quarter ended March 31, compared to a net loss of $10.3 million, or $0.23 per diluted share, in the year-ago quarter.

Revenue inched up 0.3% to $382 million, missing analysts’ estimates of $389 million. Orders delivered increased 27% year-over-year to 2.2 million. Active customers increased 26% to 6.0 million.

“We’re pleased with the growth in active customers and transactions during the quarter,” stated Adrianne Lee, Beyond’s chief financial and administrative officer. “However, in analyzing the profitability of that growth, we are making the strategic decision to focus on investments to launch these brands and acquire customers with a higher probability of repeat behavior."

During the first quarter, Beyond successfully soft launched Overstock six months ahead of schedule and brought on Salesforce to launch a “world-class” CRM platform and manage its customer journeys and records, noted executive chairman Marcus Lemonis. It also acquired Zulily, and plans to relaunch the site later this year. 

“Importantly, we’ve now clearly defined the brand identity and consumer value proposition for each brand, leaning into the white space of their historical core competencies and natural strengths,” Lemonis said.

Beyond said it is halfway through its plan to reduce expenses by $45 million on an annualized basis and will aim to continue to eliminate unnecessary fixed costs and create a more variable cost structure. 

“We believe these actions, in combination with soft launching Overstock and soon Zulily, will yield sequential improvements in our margin profile,” said CFO Lee. "As we move through the balance of the year we will continue investing in our foundation and refining the processes that we believe will enable profitable growth for the long term.”

Earlier this month, Beyond expanded its senior leadership team with the addition of eight experienced retailers across its three banners. Four were named to the C-suite.

Beyond owns a suite of online properties that include Overstock, Bed Bath & Beyond, Baby & Beyond, Zulily and other related brands and associated intellectual properties.