Build-A-Bear Workshop (BBW) 5 Dec 242025 Q3 Earnings call transcript

Greetings, and welcome to Build-A-Bear Workshop Third Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Gary Schnierow, Build-A-Bear Investor Relations. Thank you.

You may begin.

Thank you. welcome third and conference XXXX everyone, call. morning, to quarter Build-A-Bear's earnings Good are Price CEO, Voin us Build-A-Bear's With today Sharon Todorovic. John; CFO, and

subject Factors refer forward-looking to During statements Forms update XX-K Actual refer any we'll including our undertake could to the no XX-Q, are to Risk results Please this uncertainties. We risks statement. materially. to differ and and section. call, that forward-looking obligation

both measures During of GAAP included we this present and reconciliation press GAAP will measures. the public earnings distributed non-GAAP financial today's Relations through to is our the turn to and is call I'll to non-GAAP in Sharon. A which Investor call, release, now over website. And available

fiscal XXXX call. Gary. Good earnings and you, joining morning, quarter us for Thank third thanks for Build-A-Bear's

to growth quarter company's We the to web execute quarter the evolve report continue to initiatives this ever although best profitable our the power in and below continued results affinity diversify the strong third Build-A-Bear's perform drive we and results on history, to to Build-A-Bear as strategic brand. These to of expectations. represent leverage the and model, are business pleased

Of will positioned the Some XXXX income highlights our outlook comments. XX% income consecutive guidance over record million, expectations, $X.X of updating quarterly pre-tax third the of web year stock of the Even continued we deliver his revenue for the details Voin our include our we buyback, provide year. quarter and has quarter. pre-tax our perform are to results, in in an $XX with narrowing continue note, to capital and million, returned and million of period for total below XX% revenue revenue, fourth to the we remain additional repurchasing given almost our XX%. Adding of growth fiscal we for that growth as strong to $XXX shares, to increase the EPS dividend shareholders to

of our first focus variety long-term growth. is our believe our ability of footprint initiatives years, the an drive strategic our The profitable few key Over the economic within to and on headwinds, consistently X environment location is and a experience evolution by initiative. expansion of past results driven profitability to generate we largely

is new to our the repeat while shareholders. Said returning our both third, expand and initiatives with the transformation; all new leverage to expanding The have our of in brand, to people comprehensive addressable digital acceleration places increase way, continued second the market of another while been investing to support and and products. we the power investment Build-A-Bear capital purchase to new

strategic We locations XX we The store return expanding investment. of store experience contribution the first initiative our represent restarted third in net units improving after XXXX quarter. successfully on expanding in when opened margins and growth well store new our

types, with often partner-operated in as as of new diversified X associated a the corporately-operated, We franchise. with of through more more risk geographies environments shopping variety also retail opening well store business locations models location and and our entering

we expect model no past the By the XXXX, which have locations more net worldwide. total end unit varies with our As is our to X over years, to little most partner-operated widely Currently, our new per XXX the almost of store a and of revenue XXX unit our requires locations growth to capital bringing model, investment. Build-A-Bear given opened than format. the business fiscal reminder,

quarter. in have Wolf solid we unit of of location partner-operated. Since new Great stores we Lodge international are in are and a X first units opening the some first fiscal year, XX to locations we the domestic recently our net delay, September seen of After most proud Resorts, new with X partner-operated Vail XXXX. opening opened partner, months COVID in success XX opened have years partner-operated our first through expansion, Specifically, ago, X the

quarter As expansion. continued Build-A-Bear there of XX the locations end, Italy with in third for expectations experience were alone

corporately-operated Zealand, Colombian the you during we include welcomed locations, and our Build-A-Bear second Norway, international their Kuwait, in workshops a South continued to new have Emirates, closing representing growing all new and the traditional experience a When third partners we are at part across new New locations our business we opening United Qatar, and in in while net Latvia third existing total, quarter, our least the fiscal as partner retail guidance open Australia, and XX Sweden, February, opened now X quarter, during than XX concourse again, we and increased since Africa Mexico. experience mix is models, Lithuania, our have franchise. X. and of countries. Separately, And expansion, X Arab domestic locations Chile, corporately-operated, franchise also of Additionally, locations partner-operated In XX footprint, in added stores Denmark, our more XXXX. China,

acceleration our the entire is initiative across multiyear comprehensive company, of second capabilities. Our digital including omnichannel transformation the

in-store technology and stages online as the have enhance we believe to for of opportunity we the traditional to are still on early are past robust to companies quarters, have the unleash drive power we in tactics a optimizing when steps help more combined of brands tools, these e-mail, social has much omnichannel personalized discussed fully based many unified While of and our AI. Again, of e-commerce, embraced, making model, and sales, been few loyalty the through the we of vision. we implemented are both a communications creation the and media, omnichannel execution which in-store, proven including retail

data we with effort. Build-A-Bear believe and stores can is this records, visits of annual why understand to important an the annual million brand of you Build-A-Bear part million an XX% With and workshop such XX XX first-party estimated in data strategic an over the visits rate plus website up million capture our power combined XX

to the to of The while the to both third continuing drive and and initiative diversify profitable our is power brand return the investment awareness, Build-A-Bear leverage to affinity growth shareholders. value

simultaneously repurchases by company and product, investing talent. to through and shareholders since $XXX this In and fact, dividends XXXX, over the stock $XX in have content, year than infrastructure partner more returned we evolving while relationships, million million

of Build-A-Bear's continue and base by plush new we as consumer as with taking new are multi-generational gifting product, well licensing broaden as Regarding through our advantage our trends, expanding appeal segments. offerings growing and items collectibles, audience include to such over generated our million views. offerings products our Kitty such our online cookie bulk Pumpkin viral has Plush Mothman or as which already Trend favorite as fan holiday Capybara, new XX we

your are Mini under collectible the priced size is products released styles just with full in stores wholesale expanding concepts through Build-A-Bear online stores as differentiated beyond plush channel. such waves and which on New and Introduced segments, make popular sold include our in own our Beans $XX new Mini offerings. collection, partner to plush our into Beans mini February, still in based

its relationships Mini long includes collaboration XXX great Beans Angeles. Shopping opened a Hello -- successful Kitty launch exceeding premier The Friends in way on driving kind November first Center of Kitty over million is Westfield of Los We X Century our and the lines, are This to and share sales pleased located in store and example Hello to expectations is million license in Collection. with unit XX, fanfare surpassing our its Workshop selling on City in West impressions. its recent Build-A-Bear of media to and partner Century year, well best Sanrio our sales. that one A the City

we've team. the our In to investment in additions leadership past the strategic made months, regarding X few Now talent.

experience Dave newly decades some across corporately-operated toy, the of will revenue career Brands most is The of X directly beyond brings Officer a Henderson, primary consumer streams position recently first buildabear.com, as and at of driving His Newell opportunities Commercial on focus experience, Hasbro. these to growth created Chief company at traditional following Doug, lengthy and Officer is Dave joined and & plus retail our who and expansion locations products, in Melissa report Revenue time successful the operational over me. the driving channels. at Chief serving including and

our would welcome the to like the XX newly now Utlaut, Kim lead Coca-Cola evolution Kim Chief who of Brand to has in in created development, I partnerships. and Officer. strategic licensing, Hurt, on Senior Officer, Senior public and Chris largely to Company, at international roles drive Leadership who President marketing, our oversees also will years the brand long-standing communications while continued continuing joined of focused experience directly strategy, Build-A-Bear reporting expansion. us over and brings Chief Vice Operations position product of relations Kim Secondly,

We to Build-A-Bear Kim on delighted the Dave are both have and team.

the animated quarter-to-date holiday of Merry Merry Mission, Mission. centerpiece, selection, store As by web, we while we we -- is launch look last highlighted on encouraged year, overall including we feature work by by of our to the the year's have the work quarter Glisten are and final film, which multiyear do the inspired have to our continued to continued while results, our

Snowgear and this [ again EPS leveraging In and ] Sparkly be continue the storyline locations year. XX% expect launch our ] and net X and pleased items we crush we plus fourth envisioned, As [ our the Glisten summary, movie we new in countries. with XX% of one third the to for of increase, our marketing, XX are growth our unit quarter's best-selling new our revenue growth quarter the into Magical

to leverage on transformation, we and investment to revenue record location In season strategic the fiscal we the beyond, in plans for our our cash evolving focus have and top initiatives in forward believe digital that the experience the our holiday remains continuing the power deliver brand. As of of priorities growth place longer-term, our we footprint, to look accelerating while shareholders, returning XXXX. the

tree think As and organization. about for we New My where proud in important Voin. of a report who amazing remarkable call also grateful over the partners and annual to incredibly help to would more to add this this and ceremony heart little turn our are we can't to Exchange, an Stock around our the the I thanks to will evening, York of journey but the today life. I be our globe guests part now corporate from participate mission like lighting extend

our Sharon, you, good XXXX to to with Thank quarter speak morning, today again It's share third results. and good you everyone.

the launched company's growing quarter capital I strategically want broadened quarter in and in nearly We our our X% our Halloween, consumer We marketing $X increased shares. inventory, a seasonal during consistent in spent million of walt as quarterly back and update our repurchased third and performance third touch of have Halloween share year-to-date basis, our campaign as earlier highlights. This in to history, XXXX continue a few key dividend was the we generation, the paid I to quarter flow recap count. to cash financials On over drive shareholders. we stores. we on repurchase general popularity record outstanding the to both quarter, strong recognize the ] and our offerings, the from the provide Halloween seasonal Before best of an best season past and guidance, a and on sales. Also, to [ successful our brought result the items return

Now moving to results. third quarter

were For Net million. the $XXX.X up increased quarter, sales year-over-year. to XX% retail X.X% revenues $XXX.X total million,

Our primarily in X.X% sales growth was by and both the the stores U.S. U.K. driven existing

Halloween Our our X%, in earlier store You traffic most likely The increasing efforts while traffic, brand from national decreased and benefiting campaign, X%. Stuff the outpaced by Love, national by again traffic our investments

levers: stores increase mentioned fact, e-commerce In double-digit for across quarter. with quarter's Web that and began demand call units previous rebounded on to quarter second by increase. third sales average decline percentage traffic, conversion, unit demand We our increases transaction. a per from saw our the retail X.X% all the X

date. into and to However, remainder quarter performance the for our the fourth quarter softened the of

Looking international ahead, was Commercial in impacted represents challenging year. up November to we wholesale franchise for traffic web versus product XX.X% more and by combined remain the performance which difficult quarter, and the demand combination sales comparison. expect a revenue, primarily revenue of partner operators to down launch a fourth prior

growth margin expansion, XX.X%, were increase revenue an growth new a total fourth commercial XXX compared for fluctuate Commercial below that year expansion. SG&A basis sequential to continue expect the basis, retail be driven a points due a expect and margin Commercial merchandise the by of to from point We basis expenses margin on third existing year-over-year. revenue commercial million and XX revenues, timing solid we margin in or for year quarterly mainly shipments stores. to was full last both to segment's $XX.X basis. On currently of XX.X% segment improvement quarter. gross of Gross can Recall the the quarter

end and rate, percent medical For the in in to quarter continued lower our balance third This was $XX to growth full the returning quarter's year. to expect the per million, increases million Diluted sheet, in share XX.X% at pre-tax revenue $XX.X wage same reduction of the a tax insurance XXXX's of This reflects million was tariffs. the $XX.X balance an cost over XX.X%. third to a to quarter of due period last product count $X.X level. Pre-tax XXXX now was flow result record. in a largely of cash compared increase minimum million, year-over-year. we income shareholders a earnings respect a income, as prior and an our share million, accelerated million increase $X.XX, the the end, uncertainty increase costs compared in year, grew year. slightly $X.X With at our anticipation above escalation, We to the total the core as past after year. Inventory potential to SG&A representing of be of $XX was

continue diversify and our continue geographically. manage chain supply inventory We our to to flow

to Turning outlook. the

guidance. demand revenue, are annual and stores web Given year-to-date performance, our than offset by solid we our particularly our lower expected for updating results, commercial

While given to additional week basis. purposes, I guidance week in modeling the non-GAAP details and a press some comparable metrics XXXX's GAAP XX like would are included XXXX for release, on the highlight

For total million the expect non-GAAP again, XX Pre-tax million year, $XX million, week of a low revenues $XX $XXX basis. midpoint, at to last a to we growth representing million, at week compared on single-digit low growth basis. midpoint, representing year year non-GAAP to last single-digit XX $XXX income on to compared the of

for also continued medical lower-than-expected freight demand locations insurance I increasing including the of wage increased and anticipates outlook and our as depreciation many that footprints. partner-operated significantly The majority as to those stores implies new with higher well the XX smaller inflationary expenses. noted, least guidance to these at plus be costs As of ongoing web quarter. XX expected are stores store being pressures, add would

as decade our many this the I'm In like important expansion who about addition, as And fronts. retail of year number operator with successful and countries. for will execution I excited into believe new our strategy our call as Build-A-Bear thank to everybody like I the and and over happy the across the is to turn a to of the associates holiday season. This would prepared wish evolve untapped well of to and here, power our an team, warehouse now ever concludes store the Build-A-Bear company leadership a closing, our by Separately, welcome the strong a potential after brand corporate of Operator? back be all members leveraging partners particularly of would we members of new part global our brand. In I will remarks, team the questions. as

Beder Research. Instructions] coming [Operator Eric Small Cap is Today's first Consumer from question of

I us Could And help in that? been decrease? have lot the how or add inventory a inventory value is sense. of your forward, increase if understand would What to with here? did this here. tariffs, it you help is And much China impact the going shift and out ability how us of the from terms a much take you the we number and few things fully makes the why -- Could you

Eric. So great question,

One our we throughout we a about and lot organization, are supply the unique in have business product way chain is things of of where whole that sourcing as a that the the think year. we selling the

flexibility, So year. from product perspective to product are bring next earlier that same it's selling and gives be our to the because in us throughout going so that especially -- we core

the of potential changes this a anticipation have in of We done tariffs. lot with

majority so are of related seeing just this so stuff increase that's in we are pulling to a is we And -- transit. vast that

as in will the it's So to twofold. inventory change seen we our continue what have versus levels past

our We segment. commercial grow continue to

and for up flow going bit partners. And be seasonality little so the opening the is based and replenishment of down receipts our on stores to of different inventory a

addition elevated to to the least end pull we probably forward going of are as the to through levels tried have to that, In as inventory have avoid more year initial impact. the we at inventory much

that, I add for to Yes. is would This us. Eric. new not

years. We have number of a geographically strategically been for diversifying

of escalating costs very because when our the utilized shift recall, might did to our also like is freight position this we that with -- that, were significantly flow factories. and usually purchasing predict take that, when our things inventory as have cash we We bear, you flexibility or and positive cash standard our usually -- fact referred those like of our that evergreen, us. the a these of very as downside for some of inventory because a situation Voin lot little outfits of to, advantage often core the is some taking of receipt products has We

that more move of a think, little think, strong to this year? online of And When stores. that, the I kind about unpack be, is excuse historically a has Okay. especially should weakness. part lag because appears this I a -- be line. this? the to of know seen I'll I exclusives part to been the showing have where everything online great stores me, the you of this -- that to the know it do, want that. look on leave whole I at less that we've And you at thinking job between Is shift of I weakness, we how product else bit given

start is with out And mentioned more what you Well, I'm kind remarks, Voin multiyear I add this Yes. and at world happens in in with as look that, of I'll will can a sure process. consumer little often the the color. a that omnichannel bit of the Eric, consumer. omnichannel most of the that stores retailers, servicing same they're exact are lot in their that other servicing in retailers. the situation consumer a the in they're online We're a different of and some

sales in consumer both basis, is it going Venn have overlap. a bit the teen adult really sometimes it online product the a gifting. One often service collectible, a big a diagram channels. kid larger our of on in about trend We is think user buying proportion often stores, to different is family you a and a a of our If of end traditional you're little and an these

bifurcation products the because to talked of people that store come people reason other that about we also offer, to our but are party. the to using we near we website, to often is them, planning going there a see when XX So checking important is website is types what they're that that be of some million coming it the

are it the have out that personalized all the from So are more where there's to make which between steps golden And that that to takes and launches, our e-mail, integration of discounts these consumer individuals specific ship situation. do a consumers, it can a meaningful strategic integration of happen. organization takes shopping best-in-class fundamental these as long base. store, the to put the as this products integrated of we send and That's a associated are all now stores, right, individual. Well, record buy listening of very But of send That's the only steps where still a well but become is you're we really not answer, lot area. we have our as it's half much truncating to hallmark long that some that as and consumers, those marginally to that's systems of of highly skilled this in in. this we exclusive a can with that online, patterns

it's that's very efficient a but process, them for to not getting these an mastered also exclusives in online. service that to make push these shipping there closer integrated were for way offering collectors, of and day. often and then a Some it us because store. request We're from they yet, we've our wanted Again, a that them we're we store was every online to

one that. but to I piece answered well, just really think that add Eric, like to additional

goal the guests. are are As stores, revenue. an think always total we for is business, us, and are business, total are very where pleased about growth omnichannel overall resonating you It's to the is people grow and agnostic website overall And our with we in the our shopping it with we revenue. we or know

the and little different a of pointed stores. But at adults our the of working. product As is who teens who's end versus out, there a bit day, in shopping is online guest Sharon the is profile

working that funnels our remarks, And in store of very website, our Sharon locations. performing and as and are also stores. drives pleased -- in traffic those stuff traffic We to in like is her prepared significant how the shared amount

] of will been So [ is the driving our think I important company. where And total is over doing ecosystem. the us. that choose are big And it to a less have drive we last for consumers to Again, that revenue weeks. piece to consistently transact we several

true. One Okay, one. quick

we a a that in So more was good that? it on to Are collaboration, don't permanent for there impressive. I about certain sense that makes How thinking make that or luck Is other should that How would the do collections something Thank sense basis Sanrio strategic from store that we the thinking sense? impressive. be locations? was should about Pokemon you, like for know, and be holidays. really and

popular been they're experience long, for Thank in of clearly Friends, Hello mashup fan for and us. brand for bases Kitty very long of time, you. That's business with Sanrio you resonate. very, been incredible our Thank both for the mentioning the an that. great a partners Look, we've and and and

this the certainly, successful. Yes, None opportunistic are it ground opportunities. as great partnership been moment And both we to successful go it's and we opens that's like how a up So into incredibly putting the of and stake They're in that, build decisions by brands, based, L.A. unilateral. these remarks, in Westfield and very particularly conversations noted for was relationships.

make with location. to we sense does success well determine will to that also open other to wouldn't which, Sanrio -- to share, working course, we be So potential but of that if for able it that different open types of bodes And discussions, mind your does possibilities. be another

Northland of Gibas Greg from coming Securities. is question next The

on think to bit you're X guess, the metrics, there. I dive those. those the If web trends could get those think size. on Wanted with little kind a key conversion, bit transaction I units about of seeing color and more but to with the trends we traffic, little per was you color going results. challenges, on ask deeper Congrats I I a provided

terms pretty positive, anything of of drivers that out all of performance? said stood in more equal kind -- roughly were all You were roughly Or they but the strength?

Yes.

for you the question. thank So

of our that X.X%. shared levers was As were traffic down against We up the the we up. have -- in that did X I call yes, mentioned, X% up was X%. been traffic like out We all national total,

metrics other all across saw increases we of them. X The

again, So healthy in all growth aspects. these

-- retail, So our this are average seeing the per conversion that also is and are great in seeing come that's when stores, higher they stores doing unit we overall into customer guests when in when we we marketing the our our units stores transaction, higher happening. which about are and are and buying more engagement talks

helped Our of what last holiday some that how product year, before customers we the have we and numbers really quarter. Again, out in season. of are I are we Halloween really resonating end mentioned pleased the basically these well, collection done, our as of with ran drive the

the and So QX helped really fuel the growth Halloween some year. buys, we investments in strategic this inventory made that's from

bit That's Great. the more growth. little I Voin. on wanted color And increased count helpful, just get to a store for expectations

is Or versus domestic accelerating kind time I roughly? finding just, the more it international attractive you talked net upside previous store a expectations And to Is line? you're count XX Maybe the simply relative And plans where it coming to versus of color I sense of get of before. wanted how there? driving plus is new or can much provide that Is just XX guess, You function regarding that about any your what's that? mix, from? a locations?

models of you those we international locations, specifically started highlighted cases, as to just little talk as bit we color been the successful. a and comments, corporately-operated, Italy, we franchise. in different in give many about is that the of where that like of X start in -- interestingly, they've my the we partner-operated And open in I'll very partner-operated noted,

incredibly our locations. They've it's they other or so and on accelerate inside and they're sometimes but combination, shop-in-shops a to to Italy, open stand-alone, stores in more want up bullish on how open partner -- sometimes largely it's they're been often, them it's Build-A-Bear. And fast

So we a partners, And they're at created partnerships. I we're where number countries also opening of faster a noted now rate. have new

are lot and lot the a a themselves. are of by So driven partner-operated those of international those partner

a wide to more because little for projections do as think color these Yes. of bit We a spectrum And same. just all they the not all locations. these about add are have the locations, revenue we

them more of Some traditional a like in size, stores. are larger

shop-in-shops. of to Some them be going are

there clearly, are different those. economics for So

For Girl locations example, that of like Scout have have. that are footprint we the generally smallest some we

are So there had in. a again, lot locations, for countries more those model. of in different And seeing I as is these you you be the and that world they is very this in really they of our that about brands is know our is locations excited are a of plenty partners talked we little to around results and us. opportunities drive And journey things those lot we it and the one we that we know But across goal is a to the challenging stores, times again, are continuing but volume. at resonating excited bit especially of still more this in performance with over a about believe XX globe. XX runway there are that are more us, lot on of a Sharon that our that as -- now, countries we And are lot

to or I Yes. clarification think question. guess just I you I repeat Good that, XXXX. clarify were could speaking in type I on some of missed Voin, a guidance think maybe just portion of Wonder it. to percentage terms lastly, sales a you of relation in a to if G&A hear. of quick

Yes.

What percent SG&A be total we year we expect to what slightly have flat slightly year. as on a So full up versus said last of basis, revenue that our total will our shared -- to previously, a be it down. we

compressor see cost wage to as the you medical to and pressures we perspective, the minimum some we up. challenges, have especially just as from like seen So insurance continued continue continue increases, and additional know, wage rates creep

next coming Keegan is D.A. Cox Davidson. question with The from

we give just a Friday guidance kind right of there like and quarter? consumer versus anything this can nice So fourth was you and what then seeing wondering, what trends, the on beat guys the you're the is more detail little in pretty quarter holiday Black us I Is now you from expected. narrowed

as way, Black because destination. -- We for actually Friday of as important an part a Sure. a lot It's is predictor big is But given we we're holiday future a is of tend but year have discount as for I or important of the it us. retailers in not almost it for a portion significant not big as the We and our see still like us, Thanksgiving as our is season as what possibly late as in which, it stores it. steep can. for late, And when year were that in a It's steeper malls, for of much falls the us reports by important particularly not year quarter it pretty companies. We lot is well. a positive -- as curve, pretty participate this. not a traffic a a to this for by do if positive as the mean

for harder, predictions. December, the which last week the it's And previous quarter. us is we're in so November usually contracted week time first of more make period that So to a of falls --

and it. that. strong. with it specials, pleased gangbusters, was And us. but on a if say So in-store it can't for Net-net, we offered a color I of just -- was like and number was online little good it we were we felt

strong be in started really online. stuff performance. guidance, guided QX of previously, definitely, strong. very continued. tie it softened said was stores continues growth, the have very and both half to -- back in And And the expect that some strong. that We Yes. we web our stores a back with has year to Things of we and We on QX as to double-digit Halloween the with just trend

feel web even we November that things, think and of have shipping the But first these because we the of little customers of comparison stores a as the about completed just week portion solid So of lift times order saw quarter. things more still and And where last you are the in a December our about results. Again, I in and big like we things as of of Halloween you where is year. about versus seeing good and bit are. get talked QX, some we your a can pretty business for weeks in about some like some when think a QX

of expectations, were of guidance. we some the as drove So that that our tweaking below

Yes. little a in bit good I net-net on revenue, store guidance, year. web, beating guidance prior but good guess that -- of the a continued store that, again, leading performance, on to the us narrowing still softness a

just shift. Awesome. on a And wholesale -- then follow-up the timing

into the in of in into mentioned to quarter so pull right? year? was going if wondering that the first commercial was down think, I it's of -- more You out the Or this I business, is the be just delay a quarter? And sequentially the third forward next

recognize Well, these time revenue of to a lot our -- when about at the our partners. you we think of shipments

little times on bit, depending So they when locations we replenishing these more have the of holiday some especially just may international a the are the for of fluctuate timing some and those business. that calendar, now season, with openings of

we replenishment little So some a to initial growth, there in orders. about start business, going we and of of about good that, it's timing bit the feel be about shipments excitement but anniversarying those choppiness the that of still as

Instructions] [Operator from question of coming next Silver Argus The Research. Steve is

continued the strong around in on first My quarter. Congratulations is traffic. question the strength

to to strength. think any regards? given company for certain renegotiations whether company out stores when lease in if eligible does the those there. -- trends lease leverage how it the provide I outpace of outperformance think years, past traffic for renewals on that whether number and as I it's national there's Build-A-Bear I'm continues the And that leverage have retail that become this comes mentioned continued curious you've very the could calls, impressive couple a of might the next over time

that's might go as question, a Build-A-Bear I We is think compliment an experience. Yes, that, I appreciate great the far as one, on comment, traffic. and and

habits. did see, been very that where retail We of reported strong we use traffic X for that's yes, on as the we traffic during But was marketing the is thing at us for us. negative national positive of do we believe, and together. the a have strong to and -- wanting point for shifting So a shopping difference very to usually consumer And a and our see holidays. And memories through moments us some buying tool plus a that X. return a

to would often when our outpacing having while that landlords and spending them consumers tend our the we're driving to that that there us, families retail So mall with they're recognize a partners, to And strong that. do we're is they own desired a other traffic, to driving delta. partners our to our indeed, relates the note we're acknowledge we're do only family experience. And and we we're and negotiating highly that's If and bringing not And often traffic. that's the mall. bringing mall, -- traffic

these years, We past on over market as we've noted have with shorter-term I the of been has been few on many think calls leases very certain the you as volatile. careful

different that note, So and constant those. lease lease yes, up, optionality because also have we're updates as constant do I we in constant coming doing we have on pressure on know they -- we're rates and that's natural will communication communication, we well. well, Build-A-Bear But

So it are have tough by our and It's cart I -- that we negotiation the forth at good able think brand in And latitude. over I'm to and and utilizing particularly with of these brand support would has leverage, are believe do we're place a own a land not strong partners and lease. we've and right a latitude power to just brand environment, very we launch years, renegotiated driving when it noted because that's traffic, always been look is still means. you job every any proud a done a we've lease in what still and the negotiations, practically our back I we the post-COVID the and single try that team enough metrics, at And of where position. really that. on the that the our

the add, to our about to operate Steve, the in model, malls different a we the think business are we echelon we also, formats. as U.S. variety are But of you just of upper that in And able in operating like have been

we from So that can operate to we square locations foot square XX,XXX feet XXX have formats profitably.

we us be pay are to premium rent. gives because the specific not also of in amount forced that so And and leverage locations significant

our So are on. working what teams that's

and opportunities. But is more is We cases, challenging these it are at time we things as mentioned, deals. we some levels. in but our these also if what we to performing revenue more like percentage some always have Sharon And do there. deals, our as looking down, those we at of landlord natural of do do and slow leverage company at better, continues deals be these also like hedging type And is really as well, of it because helps like they a some what rent

the appreciate And if color. may. one, I last I Great. one

On international -- as more of to eventually saturating like expected the around have whether or versus markets well Basically the markets markets. entered operating and with be the impressive curious the landscape lot partners in locations. more to will trying locations in balance expansion, flagship whether as for their count a now tourist I'm just it's markets. XX intentions those international whether as communicated very store your increasing year, the to there's

start. I'll So

and pleased the seeing. definitely the with some are opening successes that we that we We initially are of markets are

process, really negotiation, long right partners. the this does the take find through about right think to you time go a it the find contract locations, As

of managing of similar markets, are to back our different lot categories. multiple may tie be partners our We businesses, a really, protective brand. And or in toys

will in in mall. of to we these opportunities. finding of of be where things in absolutely, Italy, early we the you key want our time, some it best real estate, over partners believe a the in these create lot of the And markets, Milan, some And more some so right those countries, families in stores some best

strategy be lot equation grow respective is markets. But with that They kind are those in places in So, these some of leases again, They countries. a and results. this that's we being And of in choices. best other partner-operated. making good are of seeing are side those like to respective the the part negotiating those counterparts of

take more be does take less they where we can and locations. it's control it have So give opening and -- a little on bit those,

saturating market any And European note, I or any quite would far from market. we're global

from city. Rome noted XX I when they're across Milan. in in They're scattered so one to Italy, And not stores all

noted, stores is nowhere they saturation, are So XX sizes. particularly when a different -- near as they're Voin

Some of shop-in-shops inside are of them FAOs.

of these they the locations. yes, and depends over-index about these Some tourist tourism. stand-alone. in arts, of the asked you sales also And and them locations. tourist other are they cognizant locations in on on market. And of then do our of them are And Milan fact, Rome some base It in

on own, we stores the as that we open. some just our So of do stand-alone

and that parties. very are both that information So because we, they knowledgeable course, share metrics they it are sales, the the them -- benefits of well drive of with

Congrats again of the and rest season. best through the holiday of luck

like At for turn Thank I to comments. back Ms. you. John this the to time, would floor closing over

Yes.

today you thank so third us and our much, So hear of record-breaking appreciate we results everybody joining the to quarter.

to in very We families also our forward you with closing, happy would like And we you. your wish sharing quarter to look and fourth a results holiday.

gentlemen, today's thank This your event. participation. for concludes and Ladies you

webcast the at off log or time, your of lines day. your disconnect may You the this and enjoy rest