In an update on its third-quarter performance, Bed Bath & Beyond, the newly reconstituted business operated by Overstock.com, Inc., reported consumers are embracing the business since the changeover with the bedding, bath and kitchen products boosting the top line.
Overstock completed its acquisition of the Bed Bath & Beyond brand and other intellectual property on June 28. It launched as bedbathandbeyond.ca in Canada on June 29 and as bedbathandbeyond.com in the United States on August 1.
“Our U.S. business launched successfully on August 1,” said Jonathan Johnson, Bed Bath & Beyond CEO. “Consumers are showing that they love the new Bed Bath & Beyond. Even in a challenging macro-economic environment, we acquired new customers and re-activated past customers. Our topline performance is improving steadily. We have experienced year-over-year order growth since the U.S. launch, led by orders from new customers. Over the Labor Day weekend, the first major holiday event under our new brand, we were successful in attracting customers to the bedding, bath and kitchen categories, which recorded strong growth year-over-year in aggregate, for the comparable period. I thank the entire team for its dedication and focus over the last few months as we prepared to revive an iconic consumer brand in the U.S. and Canada. I remain optimistic about our future and the opportunity to gain market share under the Bed Bath & Beyond brand.”
In reporting on the evolving business, the new Bed Bath & Beyond pointed out that results prior to the new banner launch dates reflect the performance of the prior overstock.ca and overstock.com websites. Estimated financial and operational results generated by the new Bed Bath & Beyond in the third quarter to date, the period from July 1 through September 4, include:
- Mid-single-digit percent net increase in customers since the launch of the new banner in the U.S.
- Mid-single-digit percent order growth year-over-year with high-teens percent growth year-over-year since the U.S. launch.
- Mid-teens percent decline in revenues year-over-year with low-double-digit percent decline year-over-year since the U.S. launch.
- High-teens percent decline year-over-year in average order value with low-20s percent decline year-over-year since the U.S. launch.
- Approximately18% gross profit as percent of revenue.
- Approximately 15% sales and marketing expense as percent of revenue.
- More than 4.8 million active customers on a 12-month basis as of September 4.
“Visits to our website have increased and conversion has improved,” Johnson pointed out. “Our promotional offers and expanded product assortment are resonating with customers, and they love the refreshed mobile app. Since the U.S. launch, sales from the mobile app have outpaced other platforms. We are also seeing strong engagement within our historic customer base, and the mix of orders from Welcome Rewards members has increased 500-basis points since the U.S. launch. Partner suppliers continue to add new assortment. We have added nearly 1.3 million new SKUs since early June. The bedding, bath and kitchen categories are leading the improvement in our topline performance in the U.S. We plan to share additional details related to our third quarter 2023 performance on our next earnings call.”
