Beyond (BYON) 22 Feb 232022 Q4 Earnings call transcript

Good day and thank you for standing by. Welcome to the Overstock.com, Incorporated Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there’ll be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded.

to Hemnani, conference Head like speaker to now Lavesh today, of would hand over the your I Investor Relations. sir. ahead, go Please

Thank conference welcome full and you. fourth Good and quarter to year I’m call. Overstock’s earnings Lavesh Hemnani. XXXX morning

download. are accompanying call Lee; Dave been Investor to today’s be webcast on will Johnson; Q&A. for Relations President, Jonathan is our today has me CFO, CEO, website available Joining A Nielsen available the Adrianne and slide to and presentation posted

please. the presentation. from on following to review slide, XX, slide may forward-looking two views discussion responses XXXX, disclosure Next forward-looking statements February include management’s statements. Please important our of statements. reflect of The your materially Actual such today, and differ as results today’s questions and could

potentially filings financial XX, that the is the Additional results in XX-K subsequent factors December year our ended information our with about impact in our Form for SEC. and could XXXX, included

this The we’ll call, disclosures discuss this most accompanying reconciliations important non-GAAP contain the regarding During our of financial these additional to measures. measures, certain measures. filings comparable measures the SEC including with slides webcast these non-GAAP GAAP and

remarks, the questions. ask registration call question will managements' To of the we the link please Relations for use Event under website. Following a available section prepared Investor open our

Next slide, please.

call, During follow three. the we will today’s agenda on slide

to Jonathan Johnson. CEO, call our And that, over turn me with the let

results. overview with to since financial you, the everyone. the Lavesh, call Adrianne and before begin investments an began, asking QX discuss full of Thank story and morning, our pandemic good Overstock today's our and year progress I'll

I refocused transition on purposeful three strategic the has retail Overstock to and became XXX% to transformational retailer. a Overstock a slide. in home-only Next since management journey business on We CEO. year been

a furniture This home as category, transformation public first company. XX-plus being furnishings will and the spending shift within full with be year retailer years consumer of homeowner in a Overstock’s coincided XXXX in behavior our dynamic a

progress the last some summarize years. slide this we've of three the made on Statistics over

furniture we exit furnishings product XX%, revenue addressable gained products we and that non the market than assortment by home from and January home have in Notably, in and more XXXX. expansion our has During total since over doubled our share. expenditures began period, home grown market outpaced the consumer

an team budgets, opportunities and nearly and margin costs nearly efficiencies points margin last From we in positive business adjusted found adjusted EBITDA operational expanded of We our of XX EBITDA to points. each standpoint, managed basis the for automation achieved took basis out quarters. ensure the XXX XXX gross

XXXX years loss fact a we've share. not over progress does our year-over-year, XX% the upfront, market the of that made Revenues erase below three own in last Revenue resulting our performance expectations. declined was

of lead we even already -- expense quarter positive our adjusted year, drove our While EBITDA as delivered the performance deleveraging line structure. organizational significant each top our with even weaker in

business today's to During the I our asset get differentiated areas improve light call, a continue that we leverage share top on us path performance will as of line model. should opportunity to

supporting growth Next quarter. flywheel and the efforts growth to in our those each slide highlights please. drivers this critical short We long-term. It share

While are not of these to growth always performance. drivers are we underpinning drivers our new, key improve evolving

fourth two years. assortment an during last that the driven more revenue than an over shows quarter our added of As data internal skews our standpoint, from example, by the one-third was

relative know Our still we assortment transition a competition. retailer to home We to gap have XXX% biggest is complete.

They more opportunities on identify of continue four our from team has million competition. helping gap are to home. new the trend of merchandising than added to skews since to partners Our thousands that close beginning new the

outperformed QX, in category add which to branded during a during national example, For decision quarter. our the strategic giftable

adoption better. has do rapidly, still can app grown Mobile we but

frequency. this Mastercard order on card working new customer card the best accelerate to a exciting co-branded It launch efforts with an offering, continue this call. engagement Retail loyalty launched focus its growth. our better We’ll customer is retention. to new credit always later will platform, comment We're partnership in we month, in improve Earlier to Services. Citi We one with

findability and experience. is engage for our our and we with Still, browse e-commerce site those product working deliver customers product Improving on we're on to a can how results things. and any stakes better pages improve processing search just retailer. table customer recommendation And

light we sheet is will customers, increase these continue us all capital gain statement. all help growth balance [ph] and with of aligned or managers appoint asset driver frequency income to increase share resource and our [ph], of None intensive, while business are our in model, our

We key are in these confident lead to initiatives. that we people positions have growth the right

drifted in Next glut of inventory with into started available the meets where significant had so Value. quadrant attractive positioned last slide. of that uniquely year This expertise goods Overstock our quandary. us look many a like and quadrant space home lot that our is competitors more white a Smart is to

do period. a balance them I models believe competition not over increases allow Smart longer this time, and a offer business will pricing While for Value sheets to their

deep started up quarter with relying -- pricing furnishings during billion. have with in fragmented, to opportunity competency fourth to gain competitors trying to an Value a believe of our total share demand well by the We the with growth our which sell-through drivers where home earlier Smart customers with offering on resonates market on in discounts furniture key promotions our inventory. we The extra market stimulate and and our sharpening started quarter, addressable is over focus $XXX held

by inventory exposure categories market As we sheet not have we look some share after strong advantage to of on national take competitors. in. earlier, been we our strong historically as I mentioned use some giftable balance went inventory, our to We brands and locked take of

period acquired almost strategy this successful This cases, the was the some of inventory. we sold period. year-over-year during this In through growth registered X Cyber over two-thirds as inventory five-day we on

work to we our grow in available white to don't performance the to continue to I talk emphasize about usually category. significant want I by presence us. that space

partners enabling with is worked with growth. focus efforts work who Home to to share not have market the we Renewed drive in supporting our past, us Our

supports our key sheet. efforts strength element performance drivers Next our balance slide. execute the our An integral our of is business-- to of growth

fact, balance impacted relatively cash; a our navigated fourth the a generate end sheet. strong which ability year to with managed we In we quarter, difficult to

exited environment of with position to us tactical a XXXX capital uncertain to as in been cash $XXX amenable million We resulting debt, term add will new and in just continue It million. and in and plus a cash operations long on core relying position million Having this great pursue strong net without in macro a improving is suppliers. debt, cash big $XX a we And partner for it allows advantage. markets. the has us our on focus initiatives $XXX be

fourth XXXX, we've our via quarter. million share the repurchase We shareholders shares returned repurchases. to Through $XX in

that directly During month, in believe XXXX, a direct we Medici more GrainChain. $XX are made Ventures $XX we We invested in companies, portfolio tZERO. later. million promising each million Last both investment on

and repurchases, million share of the Considering XX% sheet over invested about our shareholders. since for towards balance these or $XXX beginning our cash we've value-driving XXXX investments initiatives of

Next slide.

have still Pelion of the differentiated present Overstock continues Overstock. investment Blockchain made since Partners Medici to management investments value in significant is the active It Our for portfolio transferred key in progress we a XXXX. portfolio opportunity Venture a element to story. Ventures April

Ventures' partner in the advancing fund. assets an growth excellent Pelion has in as Medici served for

XXXX, the higher that additional potential each value financing slide, three shareholders. valuations. of and its believe for shown During left meaningful on We companies this has portfolio long-term raised the Overstock at

make chose the There to in side were right a direct fund two Ventures Ventures. Medici of of these which slide and/or companies shown Overstock on investment alongside the Pelion

on fund, capital believe such management, our that Pelion fund, not in to of are both in-depth companies and trust that. and double potential we venture these the a as knowledge companies these we we of given partner chose we general While growth for the and Medici significant have real the have their down

million XXXX, Goone, aided in of direct a we the additional $XX objectives. has Andreozzi CTO, to exchanges toward Intercontinental XXXX. Exchange. tZERO's who to by delivering experience in with made tZERO CEO, business goal of appointment appointment During new and continues creating in a led its access by new against capital democratizing David investment This tZERO round of markets, coincided a an early execute William

of web pre-IPO infrastructure of platform. Earlier its software capital campaign month, Aurox, the under compliance this tZERO a Regulation trading retail in a in allows feels enabled Aurox. major to new SEC's issuers the securities to crypto like its which fully purchase Crowdfunding, continues raising revamped tZERO shares qualified add democratization crowdfunding to ecosystem companies. a and step to begin investors This

core I may ask to enabling was know never wallet. and crypto tZERO for tZERO area a was exchange shuttering focus its thoughts crypto customers cryptocurrencies a my built for not of tZERO. to trade be on some

what the accretive tZERO's ended to augment designed conventional was Crypto crypto bringing understand I adjacent digital activity future the to to results focus trading activity its From and being not securities unique business to direction. an tZERO's or on market. financial up

of In to get suite that XX% note January, in farmer made farmers cooperatives a -- a software a It million paid Overstock convertible investment use get offering. GrainChain through harvest and GrainChain platform direct rather the to value who $XX provides enables to provides balance the delivery. the the of the GrainChain after commodity product upon upon paid customer. days to usually don't XXX up Farmers end successful delivery

this you is changer. see a why So game can

the levels has once farmers high GrainChain try received of stickiness, customer platform.

company relatively in quickly because over market in able last leader As technology an has compound years. XXX%, grown a result, GrainChain become expect and the of differentiated of to rate been it has its XXX% grow the nearly grown has XXXX, we space. revenue to tech a few annual

a Both bar to the enable to its and our in and investments GrainChain a I follow and all success greater Overstock on investments to way. follow on regular do be high. the is investment expect in While participate occurrence, future not shareholders and tZERO these of continues

slide. Next

the forward Now almost most Last our plan. corporate future introduced design on come and for At performance and We time, required. and efficiencies. of that a saw tested our we this frequently. plan, business we work financial employees update all into remotely office reentry the the to work spring or as requiring and We brief cross-functional of recent to recently we created more it environment When events. evolve collaboration better time. remote expected mature employees

plan has in-office plan bring to week. the The outside from every this After the enabled organization attract us of our a we the Forward top times Forward under three Utah. employee local talent modified most office to weekly, success to days task, to of

we major in and marketing, XXXX, underwent where Overstock identified product groups chain merchandising, and the team supply During changes leadership upgraded gaps. talent and some filled

example, proven experience chain this in help our past addition logistics Canada. just efforts in international to supply that spark and grow should week For with

and these growth. drive teams to to strategies XXXX, As we progress new exciting deploy will new

We initiatives. remain to we in confident to upgrade which top-line key in are to the to systems the and with hiring these candidates have remotely, We committed people us talent our right operations across to right growth. our the the positions country growth return allows best and from lead strengthen place

to review I ask financial our Now, fourth full will quarter Adrianne year results. and XXXX

quarter, please. competitive intensely Thank an by XX, from you, by Jonathan. products landscape and remove site. decision in Revenue XX% which to Slide non-home was pressured year-over-year our strategic the declined fourth our

Our managed performance still we impacted positive and gross Through of by timeframe, EBITDA increased discounting elevated freight margin million of X.X%. adjusted was to in costs. margin deliver $X this challenging

an Ventures $X.XX expense our Our tZERO primarily impact. the funds proportionate tax securities non-cash reflects equity a valuation our change including share of value associated reported loss Medici change, was with of the primarily investment. performance, associated by EPS of and the This of driven in updated the non-operating

We equity including upcoming securities, summary in form the filing. of Medici Ventures our provide an fund will our updated XXk

$X.XX in per decline XXXX. of of loss diluted securities, Excluding year versus pre-tax the a reported it we adjusted driven our of $X.XX, decrease by share EPS lower income. last versus The adjusted impact equity was

$XXX Our and with cash the operations. $XXX year, the We and decline mainly a of remains XX and cash by million a balance of use strong. year-over-year million. The with of ended financing $XXX million activities, of was million sheet quarter quarter balance investing driven and

we $XX to million shareholders returned invested mentioned, share Jonathan million and and As via tZERO. $XX repurchase

the also in during consumer Weak of we million sentiment pressure, to – $XXX XX% of year-over-year. quarter, from impact quarter. top XX our housing backdrop a continued increased revenue decrease while earlier a excuse the me, mainly activity discounting posted pressured fourth We please. competitive face slide and and line Next million performance,

the in our following assortment home comparison. impacted home June revenue quarter non-home non-home consistent our XXXX quarter. significantly revenue during period the our year-over-year XX% third the of to only for for absence Performance – XX% Adjusting declined fourth transition decline better The the quarter. X than Cyber reported of the in was with

able is gift increase compared during year-over-year offset by by key our Our within value. fewer brands national detail partially performance to in last positive a sales further the in assortment customer to driven add fourth discuss strategic and order pivot year, orders categories. drove I performance targeted quarter average will later. Revenue X% metrics

$XX please. Gross last year. year. quarter, offset discounting the slide XX.X%, profit a elevated million to competitiveness costs. versus by higher margin point $XX in year-over-year of Gross decrease Next price at prior by was was This period a and driven XX partially merchandising in was including basis same fourth versus freight reductions. million actions, negotiated decline cost product the The came decrease increase the support

freight, than higher margin. Regarding in expected costs came gross impacting

actions, in see taken structural contracts. our have We and freight to improvements remedial carrier expect already from less ahead pressure

delivered asset our despite operating model. with and gross light We performance positive margin to in the targeted our a model. KPIs uniquely pricing maintained of point continues environment, Our margin gross line competitive our competitive be proof

Next savings $X decreased million quarter benefits year-over-year, organizational to the we efficiencies related due referenced from and automation. and G&A last tech to review primarily expenses slide. and

basis As compared a revenue top to of of to fourth line quarter G&A the and over deleverage XXXX, XXX XX.X% points weak in results. expense quarter due the was tech a of fourth percentage

finding continue we taken our periodically and efficiencies. be performance. in We to and have managing actions disciplined spend, to line ensure and organization, run lean balance expenses with a our we top our tech We G&A

a please. In $X ago. margin decrease million, EBITDA adjusted quarter, Next of million $XX EBITDA was Adjusted X.X%. fourth versus slide, of a delivered we the year

this with pleased result. not certainly are We

manage our gains value. a to quarter. share headwinds and promotional our control managing pursuing that We and remain will business and during continue offset focused help factors highly we However, within on drive shareholder to strategies market competitive efficiently

This active trailing shows a customers XX frequency. slide. basis. Next and month customers We order active on slide measure

million X.X fourth customer Our end to of base declined the quarter. the active at

by primary factors. driven This key decline was in active three customers

spending First, related a deceleration in on goods. home

third, spend Second, online are and XXX% to shift in spending into And services. on shift preferences. experiences a retailer. continued to transition Consumer purposeful home

some As long short despite pain in this right the previously is shared, off, trade the term term.

times about to versus Orders hold decrease Order of order to frequency for decline relatively last decrease the in year and active quarter, sequentially. compared was fourth volume. X% X.X a customer continues our a in up better,

expect that over We time.

highest will frequency mix improve this with Our and association mobile continued home, metric. improved with enhance into loyalty offerings app, platform our help the

navigating in by is average and in customer While our lagging, pace of home new furnishing competitive comparable to intensely data. customer environment, acquisition is measured retention as change our to of part, rate year-over-year due an third-party furniture the other retailers online

Average Next to slide, improved value by X% please. year-over-year order $XXX.

Our AOV of declined a into assortment. shifted product compared by to we our outdoor as AOV home driven seasonal out giftable within the was QX and furniture more mix assortment. primarily slightly

AOV year improvement. this more over opportunity reflect about our has We have journey, improved you Well, $XX a home year for is our If aligned on retailer full our peers. to three of XX% $XXX. with AOV still or average

were month prior or compared This Orders a year XX is XX% X.X million to delivered trailing the period. orders. million decrease of X.X for the

discussed I cumulative with was shift driven decline primarily consumer the our impact removal from sentiment non-home priorities, in a product As their and week earlier, site. along of spending the by

improve purchased reasons our AOV revenue in being ecosystem retailer. support metrics customer and frequency. retained The compelling relatively our online and continue to Our home-only items proactive have of value our to higher stable future a customers

This which our please. a allows business, recasted slide, direct comparison excluding to slide of peers. more Next for a revenue, provides our view non-home

comparable fourth customer the see versus active of As reported declined last base XX%. the at chart, related you on the quarter, our the home can end XX%

XX% basis, due impact comparable the non-home increased the XX%. reported removal our of the the impact On on chart category declined sequential our home-only right versus cumulative customers of a the non-home The to revenue illustrates exiting ecosystem.

strategies revenue fourth sales stabilized quarter on improve performance. during we home-only trends the and Our focused the are to

XXXX results. Next year-over-year, with discussion We XXXX. financial slide. increase XXXX versus by the I will a ended full of of a decline up snapshot of but year my revenue, our billion XX% XX% wrap $X.X a section providing

the As operational have Jonathan in this mentioned business. earlier, the illustrates made we improvements

financial because highlighting for line benefits of our despite basis. our on is and This expenses performance, our million of and with line focus Gross our result targets, against management expense G&A the margin especially expense an demand year-over-year $XX top tech of declining times asset-light model, was deleveraged volatility. of a year during in absolute target. the on EBITDA delivering

below driven a Overall a our year mid-single-digit positive margin. EBITDA the a X.X% was but This $XX.X was result, million by managed closely outcome. for target, or

With that, you, back to Jonathan.

and of can Thank our not better. Those and do we We to report. results are you, Adrianne will the to like type shareholders.

like I'd our forward slide. strategic to provide outlook questions. taking and our path your on XXXX before Next thoughts for some

slide. Next

continue within direct market profitable sustainable our our growth financial to We efforts share targets. drive card recipe to

XXXX, elements framework not model did believe even over for achieve we targeted this financial medium is of the we model right to targeted all term. the and While long continue during this our business the

We in strategies these to line targets. with have deliver performance clear focus

a significantly Our of Despite good the business on target. our margin merchandising margin with half significant deliver in performance our asset-light back example of gross XXXX, hyper-competitive efforts in our this. model is us to enabled environment gross the oversupply --

to team We few our performance our and believe can was performance. achieved. Both that expectations. over we turn share, and firmly business. in we significant while That task running I can is believe XXXX presence easy an profitable I expand still us, the must and in around a take know whitespace we topline available not time. market industry below the will one

slide. Next

will about some forward, on XXXX. outlook for path I strategic Before our thoughts I our talk share

on for rebuilding I share. Overstock a to halves tale will a we be of as XXXX two market back get recover think in track year of

rates, drivers weak expect purchase housing -- the the year. see performance influence the to sentiment strong macro through year. Difficulty] and consumer during In interest market inflation, lapped as rising From the a will we XXXX, we of broader year a industry perspective, the [Technical

move XXXX could predicting we activity drivers as through improve consumer Micro difficult. is

with Regarding rationalization inventory, our inventory in in on many its XXXX. the the conversations industry, completed don't based industry believe we

half the We expect that least XXXX. will first of continue at through

While aggressive costs supply shape discounting should ocean uncertain. have be during remains significantly. decreased the determine key normalize XXXX, On will chain, freight demand -- of

However, surcharges headwinds. due high to remain domestic and labor costs

the are due the Overstock's performance first expect half some better difficult While following. industry second to drivers to the predict, to be of than we half

from non-home in will headwinds our wrap We the removals fully products June. site from

Based benefit the on in expect year, half ability new assortment product Last second inventory conversations to from our during to cash not invest with of we locked-in on had was the some newness limited expensive that partners, innovation. their moving. This of product year. cash partners

We loyalty our expanding are efforts.

As earlier, card I month. launched we with this noted earlier credit a MasterCard co-brand

We expect our members engagement great this with to our market customers. Club grow O existing – as we to new offering within and

offering We best competency our email to business. improve looking and drive how are card private-label our also repeat at credit personalization renew to

Overstock mentioned, as upgrading team gaps. talent During some XXXX I the underwent and changes, filling identifying leadership and major

XXXX, growth. these new teams deploy exciting new to will expect and strategies we During drive

think area. marketing the in I this particularly you'll see

QX purposefully competitors. including I of added capture earlier, branded indicated phase to we This national As just our struggling during from products share, our and efforts. was website market one giftable to

a product and expand assortment existing with our for We assortment, continue will new to fulsome to our customers. partners working deliver

focus among strong differentiate – XXXX. do provide since to and not The peers. our provide change since years on selective our traditional make external our it environment This years three delivered in tenant of will profitability consumer for renewed is home on ago, three our sorry I to on will my fluctuations difficult Still, some profitability. current guidance. best us us focus Overstock renewed sheet balance This ago, in sentiment, color, home

year. to the expect for be We profitable

There saying a seasonality basis factors. year are time aren't comfortable we maybe on While an and annual given within the we when this other profitable.

the guidance. even quarter. guidance, our adjusted on the year-over-year relatively will decline and cost remained just quick continuously on profitability XX% during quarter. has efficiencies, deleveraging, QX, total below specific while sales we regarding with Through we volume, and estimate expect QX Now year-over-year QX savings to this, in expect Based further range for three had. we update levels, the see the EBITDA estimated a range a the be given weekend QX the current with performance of currently Presidents providing strong QX We sales revenue Day we to February, are our relatively trajectory first first fourth adjusted of for consistent revenue weeks and expensive EBITDA not look we process margin sales

Next slide.

me Before on make forward. believe we open path comments I better leads our to strategic a the call us XXXX. for On path a which let few questions,

Overstock's and short guide operate we our business term. slide. Next how in long pillars brand three the

to will Our In performance. executable. underlying focus growth continue highlighted improve is remarks, I clear techniques how while focus our on applying to key opening -- and we my drivers, new tactics

We have aspects room our further growth. leveraging and are of to spur have worked that business

me highlight four. Let

earlier, removing We home-only improving products non-home our started more in are internal of results. we have search and January experience than mentioned doubled assortment website our through I XXXX. end and XXXX the our website from

increased. on assortment has website Well, our available

gaps identified to improve with we our have customers fix which We our engage us. how need to search experience, within

Our pillar. to provide our experience easy customers shopping findability goal our to deliver an on website brand on product is

that web in business innovation the product aligns tech the Our space model. forefront in in asset-light of collaborating search These way underway leaders with search to and leaders our with a environment. our teams currently the experience are improve at and technological are

experience teams result more for the is to improve search have repeat continues and this increase engine merchandising to identified home Our purchases our sort. depth critical and important recommendation website An our of opportunities even to drive us assortment. organization cater improve growing breadth to to as

We will customer increase our leverage offerings loyalty to our engagement.

Club included primarily membership offering program. fee-based loyalty Our our O

credit growth loyal Club more the about customer engagement I'm most recent Retail potential the an and with new basis. co-brand Citi add annual any repeat of members Services. other on we partnership our members most O frequently card cohort launch who than spend and Mastercard with as Club Our O members our are excited

card holders. no offers to fee card memberships Club This O at

among five our issuers is card network special Its top vast Citi offerings. customer aid into will and us partner a future. customers US. in support the and the expect now great marketing We the financing

offers looked department If you the repeat store, gas This on purchases Club purchases. have can on our checkout card other us members purchases. they it and O -- you at qualifying should, redeem apparel, the at drive should of help details website,

special our offer, provides to conversion free can smart purchases drive which XX-day a interest delayed budgets. in among view financing may and also extension It an have card help of value essence, to customer In that power further. due their stretch brand stretch our this is customers holders offering enabling dollars

the easily our squarely been with experience accelerating brand our has something customers they are strongest app product our growth of within smartphone, The find their sales. driving want customer Overstock app. traffic fits the mobile in convenience in that the products It platform, the helps We Overstock findability mobile pillar. successful and

KPIs Our desktop than mobile are customers business. app healthier driven the

not While its app highlight we shared growth have the actual sales, trajectory. of want mix to we

XXX basis mobile app grew around During it points. sales makes XXXX

us more least we level expected at the with to coupons. app market of achieve helps Mobile same XXXX, efficiently For growth. app exclusive

a our we demographic, to As in attract better result, a younger us customer helping conversion platform helps This diversify KPIs. customer see base.

app mobile through benefit engagement our program. increased a media ambassadors influence social consumer brand from expect We to on our

to enhance looking from We we pre-purchase customers engagement with delivery enhance through our ways our support experience. Under customer for are and and customer to us. constantly experience proactively brand continue the our browsing easy power post-purchase

unique for returns. with a about UPS partnership we handling share quarter, details Last

are pilot customer friction asset handling. been results experience. good. to impacting a light improve have solution point returns The Returns major an of always Here's the innovative initial

to shift. lot – on We customer. the more. a are bullish trajectory to Overstock's about learn of There's expanding a make lot improve that working we're pilot There's makes our me

operator, let's questions. Now, some take

Our Peter Keith of Instructions] Piper first Thank you. the from comes [Operator line with Sandler. question

Your line open. is now

suppliers This if how I site was item. morning. thing would you down highly Matt competitors from The took that first that for disruptive taking on guess items same that mark to Egger sales received we've our for pricing your on in is remove a feedback Good Thanks from algorithms highlighted XXXX, through Overstock. their is Peter. questions. the

competitor agree site to I that sales? questions. markdowns adjustment maybe So happens? secondly, guess, guess quick XXXX the an your items you are when Algo Would pulled And to off disruptive pricing you your two Thanks. I the number getting then, of the that contemplating to reduce wherever

we question. I and important let post that value went on Dave It's for the make Great mean, I'll promotion. our any responses initial given color. pricing smart proposition more

like to While have be to to And we it's lower cost the we time, margins, they're need competitive. of little approach ask to make first prices they thicker when suppliers may not when their adjustments. these low. Most frequently them them important

customer no site in the there's sales so the disruption And on or experience on site.

we the Dave, coming But add important disruptive. costs way, behave site. anything we we Some of make do that for they When that to partners frequently proposition. our to to that adjustment, is back their the back value smart time, this, second choose us and proposition have from products smart partner met. it the removed quickly, this you our we site do ensure to will – the it's so the not to value maintain slightly site come that? lowering the being on want When we this,

No, perfectly, think answered Jonathan. you I that

moment Jonathan One Matuszewski from next Jefferies. our question. with you. next question for our comes Thank And

Your line is open.

thanks taking into around at expectation this highly an great. competitive, morning Hey, for question. Good to continue least of Jonathan, and morning lot first outlined backdrop. highly of discussion promotional you half the inventory industry I think year. industry the for rationalization my A this

year kind think do thoughts of Thank trend six this for you, south would that on the of cadence of how margins expect to it's So months the XX%, trend you to gross gross expectation, in thereafter? first of may maybe light reasonable at Any least margin be this helpful? and recover

think had. Yes. it to relates question that Jonathan, I last great question and we

they period gross asset-light highly our liquidation business QX and made gross model, We -- of sales competitors, haven't year. to the margins costs, last our we even with in have. keep we that we're during QX allowed Our partners that at their own level can always don't first us promotional buys. levels working lower to their margins a our keep That's inventory, inventory why so our by at

lets asset-light that for our consistently we We level part saw more year. competitors. business keep So, gross shoot the model our us the some of of than margins in differentiated fourth and quarter last at third

anything I throughout want XX. add it that? slide see think, to on continue to you'll Adrianne, you all

to add, Jonathan. Nothing further

One you. Thank moment.

question of Forte Thomas from next Davidson. with line D.A. Our comes the

line is You open.

and I'll Great. in Thanks. question One back the queue. go

the So, Great where few prior you today's e-commerce and market Jonathan, periods, players of spending a number with profits. home weak then a consumer period exited Thanks. where compare you your the market, of can Recession, notable contrast a share, took generated first dot-bomb, significant

think, I lot a become at where historically Tom. the is more mean, I I thoughtful, in No, well. times stretch of wallet, purchasing. look they Overstock done to choiceful their heard and their similarities, term has consumers yesterday there's more

saw Overstock position unique Turn century, We was of dot-bomb your and the the we were public strong. word. was an went and

great the furnishing we growth we During recession, and home furniture, strong our then. saw in in as -- business particular, in

and look dollars, smart So more their as of thoughtful more value them become residents to savvy they're more in purchasing customers stretch shoppers.

environment, employing we're environment. predict well-positioned my are I for noted I but think to in the a like looks think growing and but remarks, it's the for So economy I it. economic of particularly And kind in strategies what any we're hard good as in deploying, tough XXXX,

Thanks Jonathan.

line Thank question. our And question Needham. you. from Andreeva comes Anna next for of One next the with our moment

is Your line now open.

and much morning, so you good thank guys. Great,

we past could go business bit quarter, should this in for the you color positive provide AOV the providing be year? as past we how in AOV a and think about that helpful been XXXX, slowed for have any through just KPIs guys You the still should on

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assortment say and mentioned, as also consumer what items. seasonality items, which our we offerings, actual and we of that of kind of, patio or different refresh potentially are sell some people buying, if we patio different they're furniture, should sentiment would increase Jonathan see the then I buying

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Anna, app Day lean to we I mobile add you retailer. regarding Overstock was it, or here. And Day into just leaned where as first continue our to refer And mobile in a would being Customer we heavily

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on grow. media where We an we opportunity our to we front, push Jonathan? continue area to social know have

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comes And question Barclays. our with next Sigmund from Seth Thank you.

Your now line open. is

the question. everybody. potentially Obviously, past? deleverage Thanks how taking how the How Hey main wondering again to model and down expense in around that? this a about the in Thanks. profitability. My for managed, are G&A well you has about to given do in is we that think but understand, been points breakeven this think QX the year? where question is really a lot of, sales and scenario think just tech sort I'm the trying of just about fixed

appreciate Yes, the question. Seth, I

are we and prepared can in noted profitable be we committed my I year. As think for to the remarks,

our and a we're tech expense may time -- when be marketing. spend Given we looking seasonality things, always during there at year other and are our how and G&A expenses the But we not.

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was think you. No, said well Jonathan, that thank I

Thank you. of Partners. next the And our line from with Guggenheim Forbes Steven comes question

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here, wanted Good appears you that if focus sales elevated. me It on I'm morning. trend. remains the wrong active loss to base quarter-over-quarter the can to-date quarter net first the correct -- customer net I expected customer Jonathan given

among current would that a drive love maybe take and planned the to start engagement have if again I you loyalty initiatives talk So, could step back and about the base? you here

there about reactivation the also you're customers opportunity XXXX? in And strategy, think how are over comment thinking your past then on here? right, couple on Any when how of about many reactivation you just lapsed years comment

question. Good Steven. Yes,

ask customers, co-branded earn really Overstock. of not comment, Dave allows on O Let and they treat new more points our color. Club me add like about with I'm credit then customers they initial can to Purchases card Super Overstock. some spend us customers an excited places, O Citi. lots -- It make to Club just more really because

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pay presence. but with this we we're we're We're this investing that app think and throughout and them of our into team that drive marketing about us for they year there. the has and mobile heavily to that for time up dividends all a little younger yet a to a demographic, to seeing also feel Takes so a will lap where as year. levers and to get a that, bit to mobile year continue is get good adoption do go and and speed opportunities first That and and of move with excited going

with stock kind Comfy” a will nice Dave. “C'mon, more to that really brand dividends pay love name On this our they team, soon. that I on rollout associate too resonance. think transition the in Thanks, That I it’s what of as Get done other area they've And said, home marketing with ad. our

Thank you.

for moment with question, of our line America. One you. Curtis of comes the Bank next from Nagle Thank

Your now line is open.

thanks Great, for question. the

talent describe growth a part you revenue I guess, of you as you likelihood to first return in one, second year you do no? or Just you the have think or year Jonathan as this think can what a the

It's larger but the operative our that new be our I economy their invest grow see many we're product your as through partners, expectation is of our larger macro time. continue efforts with – the with an and is assortment you tough, suppliers, get with product, that's Answer think products. old exciting new inventory, to internally, that's in more taking get going to guidance,

giving we want plan time that, half to that answer my to – on and but little a sure be back say everything give doing but not for second in the get growth and on is So uncertain going can because Curtis yes. guidance squishy, it – to to guidance traditional we're we're to we

enough. fair Okay,

Just as follow-up. a

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it, on know continue you’ll it. at comment look you Angela, -- we'll there. team, the I you're we her look else time. all Dave, So at and to Anything

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you. Thank

Our of Raymond last question comes Patel from Rick the James. line with

is now line Your open.

squeezing Thank and me here. question you for my in taking

the category, national giftables you categories expanding home are of on like well better intra-quarter? brands. you to opportunity assortment Can into touched newer talk working the and terms about of performance that in lean the In areas

product giftables assuming industry. high not So, inventories in round, the is I'm may be year but strong given available.

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and well home new paid and as helpful, Our balance we've that to sheet partners. we've been they're added home are partners on partners, going assured time. done adding means And new suppliers that's paid be

are important would those things. this? you what So Dave, add to

a quarter Yes. the in fourth us, a home transitioned inventory retailer. strategic took say would I we was to on we've furnishings move that as home for additional and

with doing group those business of fourth haven't brands necessarily that we're during a been ignited that of Overstock Some interested small quarter the in whole Overstock, appliances, are. seeing national brands on now who

ourselves. As very had we several and is brands an national competitor in are formidable Overstock. considerably, replacing in competitor that mentioned, there's the interested in that retailers hundreds struggling we've a -- joining interest And with a

component it. one of that's So

the improvements better The that other that of search experience. for component findability prepared opportunity find customer easier, our that for I gives We would an the overall And us incremental in adding, Jonathan customers to remarks, additional in add is are undergoing. think the we're assortment product. that Jonathan? mentioned quicker,

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appreciate question. the I So

improve I'm XXXX on Overstock's exciting. the bear to nor I believe will a year they repeat. forget not is are putting mirror, we I that projects is they'll rearview fruits. believe this working team The in will. Look, management trajectory diligently

We bullish I the Thank Thanks Overstock of and ownership your to capital. working and be everyone call. on appreciate good mind participating today's continue can to for we Overstock's we your in about future. So, be everybody. you interest best are stewards in

you today's concludes participation. Thank This call. your for conference

a everyone now wonderful have disconnect may day. You