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Overstock.com's (OSTK) Q1 Earnings Beat, Revenues Fall Y/Y

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Overstock.com reported first-quarter 2023 loss of 10 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 16 cents per share and declined 147.6% year over year.

Revenues of $381.1 million decreased 28.9% year over year. The top line lagged the consensus mark by 6.32%.

Revenues were hit by contraction in demand in the real estate sector. The combination of lower consumer engagement and a weak housing market created constant pressure on the top line.

Active customers reached 4.795 million at the end of the first quarter of 2023, down 35.1% year over year.

The number of active customers declined due to a fall in home related spending, change in spending preference and the company’s strategy to shift completely online.

The average order value was $220 in the reported quarter, declining 0.5% year over year. Orders delivered were 1.736 million, down 28.5% year over year.

Overstock.com, Inc. Price, Consensus and EPS Surprise

Overstock.com, Inc. Price, Consensus and EPS Surprise

Overstock.com, Inc. price-consensus-eps-surprise-chart | Overstock.com, Inc. Quote

Operating Details

Gross margin expanded 20 basis points (bps) to 23.5% in the reported quarter.

Sales & marketing (S&M) expenses decreased 19.6% year over year to $47 million. As a percentage of revenues, S&M expenses increased 140 bps to 12.3%.

Technology expenses were $30.5 million, down 7.4% year over year. As a percentage of revenues, technology expenses jumped 190 bps on a year-over-year basis to 8%.

General & administrative (G&A) expenses decreased 3.6% year over year to $20.5 million. As a percentage of revenues, G&A increased 140 bps to 5.4%.

Adjusted EBITDA was $3.4 million, which declined 84.1% from the year-ago quarter.

Operating loss was $8.4 million against $12.5 million profit reported in the year-ago quarter.

Balance Sheet

As of Mar 31, 2023, Overstock had cash and cash equivalents worth $374.711 million compared with $371.263 million as of Dec 31, 2022.

Long-term debt, as of Mar 31, 2023, was $34.207 million compared with $34.476 million as of Dec 31, 2022.

Zacks Rank & Stocks to Consider

Overstock.com currently carries a Zacks Rank #3 (Hold).

Investors interested in the broader Zacks Retail-wholesale sector can also consider some  top-ranked stocks like Carvana (CVNA - Free Report) , Hagerty (HGTY - Free Report) , carrying a Zacks Rank #2 (Buy) and Solo Brands (DTC - Free Report) , sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Carvana, Hagerty and Solo Brands are scheduled to report the quarterly results on May 4, May 9 and May 4, respectively.

The Zacks Consensus Estimate for CVNA’s first-quarter 2023 loss is pegged at $1.84 per share, up 14 cents over the past 30 days.

The Zacks Consensus Estimate for HGTY’s first-quarter 2023 loss is pegged at 4 cents per share, unchanged over the past 30 days.

The Zacks Consensus Estimate for DTC’s first-quarter 2023 earnings is pegged at 10 cents per share, unchanged over the past 30 days.



 


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