With a change in focus to a home-only assortment and headwinds from consumer behavior changes and general economic conditions, Overstock suffered a loss for the fourth quarter, but the online retailer managed an adjusted net income gain for the full fiscal year despite lower revenues.
Overstock posted a company net loss from continuing operations of $15.5 million, or 34 cents per diluted share, versus net income of $32.9 million, or 68 cents per diluted share, in the year-earlier period.
Adjusted for one-time events, net loss was $1.95 billion, or four cents per diluted share, the company noted. Adjusted net income was $15.6 million, or 36 cents per diluted share, in the year-prior period.
A MarketBeat-published analyst consensus estimate called for an adjusted diluted net income of three cents per share and revenues of $448.7 million
Net revenue was $404.9 million versus $612.7 million in the year-previous quarter. Operating loss was $2.6 million versus operating income of $19.1 million in the year-before period.
For the full fiscal year, the company recorded a net loss from continuing operations of $35.2 million, or 83 cents per diluted share, versus net income from continuing operations of $389.4 million, or $3.57 per diluted share, in the annum earlier. Adjusted earnings per share were $22.9 million, or 52 cents per share, the company pointed out. Adjusted net income was $94.7 million, or $2.19 per diluted share, in the year prior.
Net revenue was $1.93 billion versus $2.76 billion in the year previous. Operating income was $27 million versus $111.1 million in the year before.
“The team maintained strong operational discipline and delivered another quarter and year of positive adjusted EBITDA while navigating shifting consumer demand and a highly promotional competitive environment,” said Overstock CEO Jonathan Johnson, in announcing the financial results. “Revenue declined 30% for the year, driven by the weak macroeconomic backdrop that impacted consumer sentiment and our strategic actions to become a prominent home-only online retailer. 2022 was a transformative year for Overstock. We completed the removal of all non-home merchandise from our site to better align our well-recognized brand name with home, and we increased our assortment of home-related products by over 50%. We now have over twice as many home-related products than we did when we began our non-home exit project two years ago. We increased mobile app penetration as it has become our strongest customer engagement platform. We embarked on a refreshed branding campaign which we expect to accrue benefits for years to come. We proved our ability to drive sales during high consumer demand periods throughout the year, including the Cyber 5 sales period. And we made operational improvements in our Canada business. We simplified our equity capital structure, returned $80 million through share buybacks, and invested $15M in tZERO to drive additional long-term value for our shareholders.”
Looking forward, Johnson said, “2023 will mark our first year as a 100% online home retailer, since going public over 20 years ago. We know we must focus our efforts on improving topline performance. While the economic environment remains uncertain, our asset-light business model and strong balance sheet position us well for success, both in the short- and long-term.”
