Qurate Retail (QRTEA) 4 Nov 212021 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to the Qurate Retail, Inc. 2021 Third Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded, November 4. I would now like to turn the call over to Courtnee Chun, Chief Portfolio Officer of Investor Relations. ahead. go Please

Thank you.

XXXX. to call, Chairman, release. are slides we in Group Qurate Retail or Qurate the and conditions have Retail OIBDA, which adjusted website. be Please to the statements any certain Davis; will by or Greg the accompany flow on and financial available note thereto most reach found this with comparable adjusted within earnings Litigation updates Rawlinson; including the uncertainties, XX-K or events, the Act GAAP mentioned we like Maffei. forward-looking company note, in today's Retail everybody regarding our SEC. such measures, can presentation, press and David Information this statement release Private those our Retail's with of we'd results, including schedules discuss number of Reform that or margin, X, preliminary These Forms earnings of our disseminate differ or recent remind with earnings issued speak the QVC date definitions of certain expressly speaking to metrics, repurchase any in filed free forward-looking change includes we target, any begin, today through currency. Jeff On based. call, circumstances Qurate expectations -- contained on our required ability Executive as the materially forward-looking only and OIBDA call we any or Securities cash XX-Q call, earnings to undertaking including change Retail's reconciliations, could Before the our is events including published due to non-GAAP our to a earnings Actual statement which obligation constant statements and to and along on herein in meaning CFO, any Qurate Qurate X and of regard revisions disclaims the any Today and reflect CEO, risks on

David call the hand Rawlinson. over I'll Now to

and contributions and especially us years countless your you, to dialogue I this to Mike sessions start and months. in want to conversations the bonded service Mike morning made XX for for Thank and everyone. included for had I Qurate am and transitioned countless the last responsibilities. business, to dedication over and marathon for Retail. we leadership joining Thank thankful Qurate. the George exchange These business of over interest hours of as we Courtnee, by X numerous good you thanking today

Mike management One employees. of that of understanding Nielsen connected the massive hosts, town thousands across retail live spending been ways the have shifts Board conducted on small the innovators I My at and entrepreneurs conducted and reaffirmed but with commerce. the one-on-ones have thought conversations XXX about of shop also me why helped in those prospective and understand sessions CEO the I and group hope XXXX in I joined time was the been and factors. consumer. in we halls reasons since I've don't on-air customers, with through I engage These have his to consumer August our behavior the and customers importantly, experiencing. October Qurate. leaders, company who on working business Since with we X the joining platform. on with to met us, with understand and vendors, X, company transitioning I to have been have these outside time

in TV with At websites to networks to differentiate have way The effective more choose. able day XX even create of foundation and live with and of XXX to XX many long-standing created us and we a million customers, expand of nearly interactive be are our reach We relevance to homes. longevity provide substantial, quality talented extensive transactional hosts, entrepreneurs we a per from Our TV, beyond relationships built that highly business digital ways linear they engage transact wherever compelling more through relationships digital with to programming engaged however customers a expert network and base. more should hours do these more on established work. QVC programming in we work our extend still. ecosystem native an have and They on robust I is need vendor We into more on This than employee channels, apps. our live streaming pay than and widespread and over-the-air retailers. and year. is also our mobile years, and our streaming pandemic time. to with average and us on enables is social streaming focused the TV, It on not $X,XXX U.S., Over over month. recognize per than ecosystem the unique said, spend space evolve a is growth our website drive digitally sites, compete our to sitting With over more this a items XX presence our accelerated profitable days shift channels business purchase per tune XX month still and the digital future. the in that brands visit time. our and and services, The revenue almost XX lifestyle, global customers and best The TV times digital per engaging

I us. to quickly that was substantial and mean space. assets the hard a on digital right a building choices focused accountability brutally realities, is digital is acquire new It the and seeing about Grainger your change is brands X players. continue we businesses transformation about is in there strong of came years is about have profile. just forward When business global more the When understand we landscape I in a the and running culture. aligning place want of every being discussing getting that landscape this online for in algorithmically I scale with and and the more foundation, to of than will for in It to set shrinking things and We the Qurate, and will in have an business and this trusted, is to a growth fast-growing I as know customers less media human, customers, have look both rapidly Nielsen The technology. experiential changing this a arrest that retail not will believe that team, One honest but products also the changing. optimized the we changing urgency win around opportunity injecting I a into able building learned again today. fast. EBITDA a grow them world be market impersonal thing were IQ, you alongside these are The financial That CEO year. months. we coming attractive happen record are to firmly margins drive where can And present, that

As have opportunity urgency during us Qurate the to to the years, position I In for of growth am team extremely of record pandemic excited has short, strength we promising accountability. a the demonstrated unique as returning a The beyond. recovery capabilities world the and flow meaningful and business for and by cash through navigate future innovation, create robust cash we track model shareholders. of and this

and inflation in of and The entire customers' end others, for were uncertainty availability. sales many significant Let shutdowns. They continues from containers, of told of companies giving. also fulfillment of holidays. few chain and unscheduled they also and shift until was feelings third and the there labor trucks the are Like with a months. declining of for costs. factory forced retail a summer for mindset while move In the about delta feelings led of revenue our postpone be customers for story in and category quarter, quarter. include quarter, were availability marketing efficiency, The excited customers to activities. of Early quarter, return-to-office by to middle were limited cost apparent cost we resume on extended that to shift constraints or are of and the the and us family our past across the in dates traditions own the include excited caused looking factors to variant by as anxiety the the me drivers. changing quarter between These gift the was start times over the and research growing encouraged and Toward delivery These the COVID are seasons demand sharing to headwinds freight, now most XXXX. deviation vaccine many seeing This our cases customer and the that impacting industry. cost a uncertainty normal inflation sense macro sentiment. remained, They shifts supply measures larger-than-normal net mindset and plans. some preparing forward of the They some to customers

and to quarter. delays revenue. we the X%, company, revenue. during do down Please an we the inbound cost inflation counter in in declined that an at And orders shipped revenue on while multiple price to revenue quarter, demand what and of increase In selling illustration businesses. shipments. between net delays net declined refer QxH, was pricing the item was environment, Further, X%, sales For our Recall saw in took demand Slide this We presentation sales for all of while freight control until compounded increased to increases down also advanced in not the X%. and in of we led the is total which net our XX components deviation average demand focused net an at X%. recognize we revenue could

we their We and appreciation to sales advanced substituted also through into velocity slots presented offer as work for purchase backlogs. high-volume orders, opportunity in products patience customers to vouchers customers the lower through time

We in QxH, cohorts continue out International customer largely engaged our QVC an TV of customers number X% Garnet and grew to minutes average At by The remained QxH which our customers QxH, respectively. X%, We spend and saw in apparel the items and total and Hill. purchased as behavior at viewed, played rose X.X%. increase expected. among generate growth

partially New constraints supply and and count innovations, home like which occasional and categories electronics over-index and occasional impacted customers in chain customers quarter. by spend were new declined in most because this

numbers we them to rates best convert are see down XXXX, continue reactivated the at from customers new as classes. previous to While of and similar customers

a percentage to product had in macro needed business. in shifted the industry U.K. XX% a is be product at QxH on business. to item tend will day, item a provide planned our sales offerings for video was between item TSVs of and XX% and time. of And that concert significance we sell have Today's a we on other halo outside This a availability with with of typical daily QxH, Let On color are one lack the of advance commerce That and me single At to of months availability. many up the TSV with more Historically, product product headwinds often business, the focused Values make Today's impact particular brand. and story on in Special low due XX% that one TSV. in our this XX%. of due day's to of shifts Germany, engagement bit Specials availability. In minimal one effect

is inventory over is support mostly was transit The it was brands a from across Zulily, item increases unavailable less in were business, we it to limited product control planned or business Cornerstone subject optimized stuck the challenges. harbor, the chain is when more immune also So delays. not to direct less but key to availability proprietary, to in national supply offers. necessarily costs in is At events. transportation and top-tier shift substantial. Again, its the still which provides because there And

average year-over-year and the QxH centers container QxH seen than the to shipping Zulily. have XX% Cornerstone. XX% a average rise X.Xx labor in XXXX for increased our of We Further, from rate cost for more and fulfillment at

As we improved of a actions taken we've to fourth series performance ahead, deliver the quarter. in look

supply. are and the in Consumer supply adapt. for communicated we of of early further mix as First, to strength a by with delays, planning portion have allowing to a margin delivery QX. pre-bought significant you profile. of sales a We the productivity lower-than-average proactively inventory And electronics acquisition time in pressure customer to balanced may and revenue QX are recall, of mitigate taking pressure inventory larger portion our is to understand materially delivery approach lack normally that chain its new XXXX. weighing year, a taken up we more electronics electronics ahead QX production and and was This

period apparel, the We same home And more bought inventory last also XX% seasonal than QX to receiving in decor. inventory in we in year. XX% anticipate

to ship expect Second, which QX. orders, we in advanced took we

Third, TVs we HSN online are conducting on streaming top-of-the-funnel support and campaign and for awareness on-network QVC to display. campaign and they connected engagement. what and TV, customer The at Hulu holiday brands of like build national advertising a offer limited audio the run radio, to QxH national will video, online Sling, wider

We evaluating TikTok our are and we across platforms mix growth the to improve Where retargeting as such and engaged with pressure. we more Fourth, us also the non-QVC channels expanding who are through appropriate, the a Roku of counter to customer our mentioned, marketing and digital digitally on diversifying cohorts. of have pricing HSN as enacted customers inflation targeted increases portion channels app.

in commentary that this of widespread holiday mindset. has chain the will the is quarters notably typically until want leave for limited more meet holiday holiday good Looking into to sweaters, for consumers shaping of lead leaning to outerwear. denim, and fourth shortages the seasons. we in anticipate shopping to seen customers' media plans momentum the recent loungewear than fewer been minute. will the items, in apparel we sustain last QxH, consumer change excitement demand supply We've our are likely We quarter. the we and interest There availability would and the We generated

As earlier TSV. leveraging we and We've September product, that investing and successful been holiday We in have adapted demand in and areas demand. our with QX a successful a inventory to When our airtime anchored conducted holiday-inspired and demand our have customer beauty sufficient in are momentum events by and an result, position. stand in a kitchen secured we've purchases. gift we on had we mixer culinary, holiday event support products plans kickoff fashion already where focus in sustain that has for stronger a Beauty gifting rebounded very October, to aid encouraging. events

and customer we've the positively. for Windows team Our Gen engaged the Similarly, was and quality the customer electronics, inventory secured responded available XX consumer hard-to-find as iPad in X launches. such had when product, the

to and on We position a will inventory in a are QVC weekend, will QX better team's In holiday host electronics It feature than industry With Us environment. planning. our will run the event. livestream streaming due on of will unique live shopping deals. It our creating and social pages stream and mobile apps. and Shop shopping Facebook, service Live, year in cross-platform remain, websites also channels, Instagram, amazing hours year video this on with in TikTok XXX-plus this coming challenging linear we macro factors YouTube, last HSN our a The

we in it labor However, QX, logistics we because anticipate delays future XXXX taken, bit improve. pressure of availability believe do impact, into to transportation and the as our U.S. said, well as and the the from manufacturing, freight challenges deviation team cost from and net predict than while be difficult QX performance actions product businesses. be due and European ongoing will demand sales remains better revenue our to With will between will the a that has and

of in leadership. time conversations, service will concluded Turning I the to be I After leader many and of business, want Jeff many early Yurcisin, for new the XXXX. Jeff the accomplishments President him the company thank for that leaving as mutually announce Zulily, to topics. and to to had want his company. it we that that was other many, Jeff

dividend a hired Zulily. storm new new we perfect but current approximately growth. Today, of for announcing We business stockholders dividend payable per also time a market also environment of leadership, an million. leader special a that with business aggregate The is returned Qurate's to market a we and that over believe be share we CFO have and $XXX common $X.XX the to recently that normalized stock of a for model, new underway, can search profitable for for are cash

we here at providing shows of I accountability to a In aspiration, Qurate with next in sound foundation I am October of can a to Day in model. the profitable returning confident by a share that flow am XX additional journey. announcement cash flow belief excited return to to and a I Qurate our growth lead look November growth. shareholders. path growth commitment majority Investor spring. continue a portion be repurchases XXX its is to business on more through the year-to-date and through substantial long-term and closing, substantial a of of business to addition and this urgency, With for very potential and year-end view future new our build and forward to cash our plan million, In untapped our substantial to fulsome shareholders XX observations more

in review Now more call detail. to our results to I'll Jeff financial turn the over

that Thank Unless on for price, inflation. compare by September selling my same financial Unit approximately chain X-year believe product you, estimate XX, quarter increase various for David, disruptions primarily ended X a at partially to QxH. Adjusting net declined comments to this on which actions targeted XXXX. noted, David in mentioned. comparative would mix third Based volume, been Revenue QxH. period cost offset of Starting and performance X%, volume to have primarily performance on the offset impact, of the months QxH from morning, digits in chain unit up half constraints basis the to estimates, declined supply pricing XXXX. lower we everyone. and with good otherwise reflected XXXX QX internal low supply single an X% the we was average revenue impact decline

X% counts decor, sustained grew penetration. purchased in apparel largest basis a with the XXXX from average of subcategory home. spend home moderated and in pandemic point per declined the As within and E-commerce we and is yet $X.X overall growth which units increase customer highs, anticipated, billion customer XXX revenue

Apparel the classic best offset than contemporary, home in primarily X, we and more increased X%, Slide which shift from led electronics to with in a decline activewear. category and mix, was and on XXXX. customers continued brands apparel. strength illustrated expansion by in The apparel revenue As top experienced

pleased demand in return for nonleather handbags, mix and casual luggage. declined in but We line growth to to was lower X% which footwear, normalized have experienced fashion XXXX. X% was compared offset and are up loungewear, apparel level by product with leather accessories, partially XXXX. to its Accessories handbags fashion We footwear

the QX. declined as beauty we X% said, growth increase beauty we of experienced While David And for in September. demand expect to X%, airtime month in

we an from cleaning for up reflected declined and As electronics. and year-over-year anticipated, continue solid Consumer normally cookware in wellness, fitness particularly and chain for electronics in and declined constraints pandemic-related over-index demand lower products experience growth decor, that The items, was kitchen care home strong occasional supply this XXXX versus performance who XX%, well home to and bed floor exceptionally in reduction XXXX. reflecting and demand X% a Within seasonal as bath. customers home, category. as new

holiday customers is we were season, and OIBDA And products were better when points. basis OIBDA going our Our engaged to XXX positioned this QX of XXXX. adjusted declined believe into compared available. Adjusted XX% inventory margin declined

of offset increase reduced Marketing fixed expenses obsolescence points, and favorable our expanded approximately margin reflects adjustment and fulfillment lower increased associated accruals. fulfillment unfavorable, for offset QX. key debt promotional credit basis partially favorable inventory. due prior margin labor a points, reduced inflation. and and shipping true-up rates Virginia marketing elevated Roanoke, to optimization decommissioning XX Looking Product lower to We payments activity, expenses favorable margins and card centers label Operating income of unfavorable costs, this approximately a performance basis and current provisions rates part to and on was drivers at aged on of points, credit and offset year obsolescence. primarily increased and SG&A higher compensation by expenses labor expense platforms expand higher freight at the primarily private Bad due number revenue to unit favorable from as unfavorable, Inventory declined default screening. debt higher handling lower Fulfillment partially shipping Gross our to by PA declined were installment rates accelerated our the prior primarily margins costs. and basis engage service. volume customer from This due in partially digital settlement was surcharges reflected year with anticipate incentive partially cost Lancaster returns. audiences improve lower fees the QX to and of plan. the lower and network handling offset year, costs by XX compression. customers higher card closing year primarily deleverage product margins, was inventory relative reflects XX improved QxH and of by from an bad and credit and to

to We are orders, quarterly through advanced QX. to XXXX in the toughest comparisons QX ship expect cancellations less and

adjustments. to better top-of-funnel supply certain modestly. view estimates quarter, launched relatively elevated prevailing addition, of margins are advertising XXXX in on our XX. favorable flat to year-to-date chain on flat Based we a now anniversary XXXX for year our last cost months than disruptions, was the we disruption, OIBDA persistent inflation reiterated cost and HSN. our provision will of expectations QVC be Recall and X for to of In relatively have and full ended XXXX we supply QxH chain expect results predicated down broad-based drive inflation actual of inventory December QX and QX be This position OIBDA awareness and campaign margin an the

constant Moving Revenue X% focus to on My volume, declined selling currency on in by partially increase International. price. will an unit offset results. QVC lower comments average

at offset were challenges QxH. These growth in which operations in constraints tenth similar quarter chain supply revenue growth. its faced of sustained Europe delivered Japan, by consecutive Our partially

across and all last strong anticipated, categories. was from and margin points. XXXX, in -- apparel, and increased other gains the beauty Compared flat behavior As points. Compared the XXX than quarter, customer from gains growth exhibiting E-commerce counts in with same year prior basis declined decline relatively electronics cohorts. jewelry and the penetration XXX outsized but customer in reflecting cohorts new International business are of the declined adjusted more to count XXXX, generated in the year customers QVC growth primarily slight Home experienced as compressed OIBDA home, total and X% in declines to from XX% total year's XX%. for revenue and reactivated increased XXXX. X% declined OIBDA accessories. last in Adjusted a apparel, basis revenue

basis the primarily lower margins expenses were approximately volume. in due expenses, margin drivers higher basis the XX higher approximately key commissions and from Looking and costs. cost offset and to margin Japan and of primarily unit contractual incentive to of partially at higher by higher to due unfavorable gross XXXX. marketing basis to product points primarily fulfillment points, TV XX fixed revenue compression, labor due in shipping the decreased compensation. expenses lower was freight pressure anniversary margin partially costs on unfavorable, and were Fulfillment handling lower due unfavorable was Product nonrecurring carriage due lower Germany costs. to XX increased points, from rebates Operating SG&A

XX%. from X/X brands Moving marketing revenue which brands, inefficiencies. to Approximately national of across down inventory emerging approximately is Zulily. scarcity Zulily's reflecting and Revenue declined and national was XX%,

challenges product We continue were partially XX.X channels, by to consumer deleverage factory sales paid costs, including fulfillment declined marketing see with OIBDA fixed iOS business. $XX surcharges for lower and sustained margins. cost -- in higher privacy offset business, to factory These were to launch. growth offset the direct decline the combined and across direct marketing higher particularly pressures our million fixed mostly expenses, due Adjusted freight due

by -- marketing Grandin million, expenses. apparel furnishings, to in were grew momentum Cornerstone's higher revenue Hill third Garnet sustained textiles and gains e-commerce at revenue Adjusted recognizing X% at generated home record offset textiles. and costs primarily bath and E-commerce expenses, by due inbound revenue driven growth, revenue Cornerstone. Designs from quarter grew decreased The home freight to X%. Road. and business decor, Ballard interior administrative $XX and revenue partially lower OIBDA Moving

XXXX XX% inventory Qurate countries. And of from exposure. foreign approximately quick certain represents into Southeast Retail outside have our Just application the as other import States taken United over of importer the tariffs, XX% inventory since designated record. note is to a to directly the of its sources China Asia of half on and sourcing. diversify actions we and

Turning months $XXX the cash to our were X balance flow. Capital first XXXX. and expenditures in million sheet of

driven In in sources of on TV renewals XXXX. of of was expanded decline distribution which our The working addition, first capital, $XXX flow attributable million the million primarily cash spent XXXX. planned is Free capitalized for included to inbound our wraps reduction customer incurring our inventory we XXXX, multiyear installment higher actions, distribution longer in receipts sourcing XXXX a base and in is by elevated year-over-year up holiday renewals payments, with strategic which and essentially prior for we In are of agreements early now expenditures $XXX X is no incremental. TV freight. our months year contracts,

Looking profile. capacity. million $XXX September $X.X available was and XX, QVC the On at our revolver debt was under billion drawn

leverage XXXX, that, our a cash, reducing of value The facility. the forma carrying interest restated Our extending of revolver, as turn to X.X% the MSI I'll MSI to unrestricted include credit including After quarter will the end, to revisions the and exchangeable redemption X/XX. our the notice to end These X.Xx. XXX% pro to all revolving as and over $XXX debentures primary the by was our leverage to through group it we million capacity our be exchangeable the ratio addition Greg. was With rate issued the of and of funded recognition defined QVC $X.XX group credit we to billion. our borrowing amended and maturity total facility was increasing calculation, borrowing expanded X.Xx On October reduce Cornerstone QVC of by of quarter Cornerstone. year-end. redeem The to leverage debentures revolving as XX,

Jeff. Thanks,

tremendous his his David welcoming for first again, by start as earnings XX thanking Mike to George CEO like I'd to on call service First, Qurate. years and of

we I'd note in is ahead tax dividend financial about that we a announce cash The to mentioned, includes from purchased million. pleased $XX per we into of share, the approximately $X.XX cash that million million of million. likely entered David are year-to-date special a dividend $XXX quarter. a second $XXX have of total increase. As instrument settling for That XX shares

million $XX additional and we'll outstanding of fourth worth in an repurchase to under instruments also the financial quarter. sell expect that We remaining stock

are buyback shares continue count based the XXXX targeting year. share of will of our We on repurchasing start our year-end at the and outstanding XX% strategy by

you our year, of of ongoing reflects to equally we And items. and David past, of cash or energy shareholders. Qurate business green told more are about flow and we tax, to returning in like majority the new announcement and Retail our as have commitment of other We our our of returns virtually it, as our including some endorsement evolution all we returning about shareholder forward statement the cash intent onetime look all of free welcome a flow. committed dividend We Qurate's this to our our This to to CEO. anticipate ongoing balance the majority the return substantial

We seeing Investor forward to XX. Day November virtually look for our you also

up Now it with for questions. that, operator, we'll open

[Operator America. Instructions] We'll Bank with Haas of take our first question Jason from

the by So wanted call, ask to chain would about last the first, about I we I hoping on delays. know supply they that you were arrive talked September. had orders,

those you the if pushed maybe So in some expecting were September what October. that issue was, that's were and delayed I'm if curious revenue into

as and can well. come start I let that, in then on Jeff I'll Yes,

question. here, all, I of it's and the First to great appreciate be

the chain So quarter, throughout supply delays did we ordering quarter. the in of drive that did advanced and number see a

number, you So quarters. that what I would expected we think order advanced have tell an in about double we're exact giving orders were don't can advanced prior I but

more of of piece definitely deliveries than business, our XX% about those In think about that were QxH we XX% X weeks late. was of it. the our late, came I so -- And deliveries

and customers going product. do on to drove also so ordering you was we a the advanced time relatively a I when successful that longer another be caused lead to July have of Christmas as including things, would some large order advanced us say And that know, advance. year. that more that this was number ordering, thing in And very allowing some Christmas event there to causes to for do people

in higher-than-normal so to deviation And also of ordering. led terms that probably advanced some

chain big elements some was definitely there other So a the but throughout business. also supply element,

we supply what demand while our going inventory, that, And would thing add The outstripped has was David, be the had demand really thought I a exceeded the for only there. customer really of supply to apparel adequate expectations. to is we

very we So to of we table. mentioned as in for to, That's upwards reasons the to XX%. inventories David XX% the some felt left bring the additional we a fourth opportunity of quarter, little earlier, worked on if why as have diligently had one

really helpful. have for a it. Got balance That's couple And allocation, questions then either for and sheet Jeff I capital Greg. or on of the

Cornerstone now? provide new decision believe The behind was unencumbered. biggest go just the And could ahead on and facility. previously that more why I be first X why this if also then there? my I is a guess would questions leverage color include credit some you capacity take

take you at that? do to shot Ben Jeff, want a let

Sure.

added is borrow Cornerstone want at facility, that to the note, the we being put that any are them. a under They to Cornerstone as co-borrower. that they they don't, would have extent to to to time. on Just To -- remove the continue extent leverage ability that

more directly was simpler at flexibility that so wanted Cornerstone. we it exercise that facility creating a so than And

true the rather incumberance moment optionality though. Its than at

had question? You another

My the rationale I I doing to the ratio transactions question of any well, to you’re through be Greg, for doing? helpful those. would Yes. that one just leverage understanding the there? walk get then second just take kind derivative another could of And guess second think is up it an reason you – just, maybe the

you expanding talk then about Sure. the talk Bill, to want I’ll first, do instruments. financial about

is Yes, it sure. Expanding just coming really back.

we higher were at level back XXXX. If you’ll recall, in a

billion. to $X.XX refinancing During dropped the XXXX it of revolver, the

to a company in even slightly a leverage a more much So than at given that us more banks amount and space it. attractive levels, willing from perspective, the we higher took more is give were attractive

facility. We our depending we we against share in a way pocketing buyback settle. attractive financial stock, knowing have extra that’s or our how they reducing of warrants it’s issuing overall, been the our attractive buyback, on own that some on put instruments, place. net against have think cost we potentially But So overall of repurchase change an an think

question Yruma Markets. from KeyBanc with next our Edward Capital take We’ll

focus you follow-up. about asset in In a guess then makes that digital. given importance as background, I think think you prepared do quick your think improving the require as you outlay? significant think need do execution? of you sense. your M&A? I you just of remarks, you digital is a And Do forward, of And this as assess you do you lot talked have, base going And really kind to one about the obviously, performance of the will guess capital

saying it’s On little the maybe people on of visibility chain kind on hand? get commentary interesting about have the better? quarter, that fourth is bit shipping the inventory issues the most because being a I little supply are bit tighter just intensify versus will in symptomatic guess you this greater a because

question. great. for that’s the Yes, you Thank

winning retail revolutions. going media same are at both and sit I time, think What right center of we that the digitally, to of is is landscape at digital are We that. through dedicated course. the the changing true So landscape the

to so term, long winner to there. win be a have And we

doubling we’re So down.

to One the very place of we’re streaming especially about every attractive that would I business today the side, that’s about be. think on things want the is you

And streaming Sling services, interactive digital services, streaming and continuing live our are social, today. TV, TV. then is are right thing over-the-air free apps streaming, true platforms of We’re websites, the TV, on same all smart And we mobile we’re the where social on streaming but TV shopping TV, platforms XFINITY major free pay expand, in largely the today. XX, the own Roku, on we to streaming Flex, Comcast, services,

that’s play industry. growth in – and more about Because a of, require meeting looking we I substantial with a the to plans call more shopping role when those the we I the to with is platforms you somebody it’s with people we’re lot everything. with something of talk wave platforms, everything continue to platforms. to on to our on ride we I going a when some to stay back get time at little tend meeting more to we Day I’m not to to we during I’m Investor moves to the continue only that future, think probably happening. and don’t be the have doing those think meeting to bit I’m next have large close the new. on in and across about more think, early – come in platforms, going entrepreneurs, I’m have the to innovative we space, that the more productive year. be

us keep up. So it helps

going think strategy. we’re player requires to it So consistently. be I don’t our any capital a substantial allocation change to

there’s no do this to internally that. We’re but focused If course, it, to we based able at something of investments. changes would look interesting, on

of a in our we’re is is to time do urgency On I we win I position. centers, digitally. ulfilment shipping, would are we’re – starting where and necessary, be and in It’s about starting I see centers space some feel the pressure. clear some still to early to elevated, backlog. one bit ulfilment lessening incredibly to largest starting yesterday, are was incredibly we’re signs that still we’re see elevated. little of starting think what So to going at determined good we’re play the and – of in costs a of say I our

back. starting of hiring see market and labor lightening some the to in We’re success some

started still elevated container an level, a think have but to incredibly are costs just I touch. stabilize

are into discussed that in sure bit have have important And then quarter, a some can categories some then steps ulfilment we some last fourth targeted, we of apparel for making And the position had better about better inventory had the price we we year, also, than where feeling increased before, chain last we’re year also better are costs. we taking taken some very the fourth we we than in prebuying and very a position so electronics both the supply cover necessary, being because going So center. those a as that quarter.

a everybody we like chain industry in when issues. the what’s comes things it supply feel to be tried given as forceful for just tough can in we we’ve So possible, control, the to as market environment

Jason comes next with Citi. Our from Bazinet question

quick questions. X had I

second, that mentioned Would Or revenue in the – reverse is tailwind chain that GAAP that the or that question. sales quarter. street And supply contra assume you then to GAAP elevated for something risk assumption happy revenue incentives given of that is the are You make or it were to cash us booked the a will to because quarter. there than first cancellations the reasonable delays? the making on you something greater demand in of in and revenues flow as the free mentioned my normalizes? all become as That’s customer

customer meant. incremental. that I installments in is are didn’t no You and the now said longer just base included understand what

just expand that be could great. If on that comment, you would

orders and to about over advanced for I’ll Maybe I’ll it commentary and cash start little turn bit, talking Jeff flow. free more advanced on orders a

do that into So the the elevated – ship some was there advanced We orders third quarter. definitely to of quarter. were fourth in carryover expect

and do revenue net this reverse up maybe we expect so And quarter. in a stabilize demand bit and the to deviation between even fourth

that want free business. see do add you that stabilizing would anything normalizing we the cash for So and you and we’re seeing the on or Jeff, to in touch flow? anything

Sure.

providing. cash opportunity respect sort customer number that to a we So free reset year to of on recall flow, expectations for installments the once-in-a-lifetime were of sort us with of was you’ll last the

reducing providing part is so, kind were doing the our we of installment all in opportunities. of resets While now were were forward. some installments base it on of we products we and upper offering, And that going

now the it’s us opportunity reducing installments, where been have year, part would last base. a it number our So in of for positive of

Going cash of that, any would it’s this which impact marginal sort going adjustment flow any free forward. on now year, to have our

question take next We’ll Reuter our William Bank with America. from of

ones, ocean of their for that vendors are pay you lot responsible the that’s Some retailers a when of freight coming Other mostly to domestic? Or you manufacturing about the with regard freight, are elevated talk – paying that. the some ocean from And freight, for facilities? those. they is

that, to talk to want Jeff? you do Yes,

Yes, absolutely.

bring direct our and domestic we’re ocean the it getting of to more is depending higher percentage is the a that the we back door. product for of prepaid, little product where details bit in, the “collect”, is XX% in record, brand where freight the for a that lot get taking we XX% our product our where And it’s as especially coming already it particular on for to we’re actually we sourcing the have we the HSN as paying way where that a our actually example, it included facilities to a suppliers well on all it versus product an are importer cost to basis. freight for product and given door, are I’ve then responsible QVC, if So to paying the is of of included, of at in brand,

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portion And cost any of Okay. said, – to think into have point? you put through elevated this increases cost cost way at I mentioned the portion you then you you what there pushed a have context, guys seeing. that that been through, of pushed you’ve Is that

we’re I – I say cost to David. is quantify Yes. don’t of I increases. prepared would don’t think this a that. we’ve couple is What taken

that see continuing We’re continue. as the that at think We in increase market will well. cost to competitors

we in very September. We haven’t Despite took a We still of diminishment one any July demand price. and July. business, the seen in we took QxH one and in strong July, Christmas substantial had in – our in increase

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surgical. to be We’re going

market value making proposition that a our the stay But think intact. inflation in a what’s sure have there’s for happening level market. on pricing we and the eye keen customers across of our We in

We’re given the going to pressures. join in that continuing cost

lastly… just then And

would seen say, over it just to increases, Jeff increase of at average of I other price Maybe because prices is our we thing I’ll all sale businesses. these and the pass have

talked X% script. I about my I think a increase in

of that to bit it so And downside haven’t and tailwind, we has a been far. a so seen

to So continue add? continue move we’re you Jeff, to to smart, be makes but sense, going we’ll where there. to want anything it

it. you’ve think I covered No, you. Thank

Okay. And just for lastly then me.

net little of going a to target? onetime that bit. your is push X.Xx. leverage The at Is guys leverage up You were dividend still X.Xx net

flow that cover that the anticipate also X.Xx we substantially better, Yes, cash given dividend. that below out will But we we should are or we free clarify, X.X. point should

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Capital with comes Sullimar question from Brewster Group. last Our William

I'm one going short. keep this to to try

decline. seems presumption that it business me rebuttable So in this is is the to that

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highly I why. People you. speak see can very of

all this such hard appreciate sorry to is And work. but that we take tough your a over quarter in,

for you Thank that.

Day we our all XX. thank Qurate. listeners, for look to your are of you seeing interest And in Investor forward I said, we done. at virtual that, To on And as you we November the with operator, think

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