Mike Mougias Vice President, Investor Relations
Matt Meeker Co-Founder & Chief Executive Officer
Howard Yeaton Interim Chief Financial Officer
Maria Ripps Canaccord
Steph Wissink Jeffries
Call transcript
Due to licensing restrictions, you must log in to view earnings call transcripts.

Hello, and welcome to BARK’s Third Quarter Fiscal 2022 Earnings Conference Call. My name is Alex, and I will be coordinating the call today. [Operator Instructions] I would now hand over to your host, Mike Mougias, Vice President of Investor Relations. Over to you, Mike.

Mike Mougias

Good afternoon, everyone. third XXXX BARK’s call. to welcome quarter earnings fiscal And

its and Matt Howard call Joining be website, made and call. webcast are after of Co-Founder a is on CEO; replay and webcast available conference me today will Today’s Meeker, and the our CFO. Yeaton. being the shortly entirety Interim

Additionally, a and company’s be on found the can Relations was website. results press financial release our covering afternoon issued Investor this

statements. of the begin, future statements I contained to following the afternoon’s results to affect subject would financial today’s now today’s that over information future are to some made With The differ. of Also for during Matt. measures. could cause that financial outcomes the our that, results uncertainties could call also let call in current non-GAAP forward-looking we we our outcomes. measures on on will Please certain our call, Before expectations management’s remind factors regarding risks like are on Reconciliation refer to this information and and discuss actual non-GAAP you release. to turn are filings and based and more SEC press me to

Matt Meeker

today, a I'm ago, ahead, results, good on years dogs happy. opportunity. as and to join great to believe a third position XX why Thanks, Mike, I mission, BARK with we capitalize BARK this strong excited we make the to our afternoon, and everyone. discussed founded opportunity you quarter simple significant all is in

BarkBox impressive every recurring category for XX% a enjoy treats. their an that serve. of and predictable Once served and we month, with dogs, to of started of to due first us to a change a for gross our the the years. build the we allowed is CEO company great exclusively own toys moments millions together. customized many dog experience families with revenue our brands created As nine defining serving moments our selling people you for This consumed customers dogs know, Those business, through We dog creates great and I've us of way which margins, millions products.

Our annual for XXX raising relationships, million going four customer while three revenue only grow of in outside adjusted products, also results million fiscal XXXX. in achieving and public. model helped out revenue, to capital very $XX us were best class EBITDA capital efficient, We in quarters positive before recurring

we a Now, creating with daily are food. on experience the same basis

with today. immense scale, the Put I but we roadmap endless brand people. opportunities huge where like must is reasons with at dogs, presentation believe That's opportunities out to XXXX, I'm are company. at Our Big one and opening CEO In opportunity is engage best execute the strong last our we inflection and now point, bullet said untapped health. slide many role our for at this scale important why that first time point the big of a vision, we simply, excited foundation brand, an ahead. and BARK to fundraising areas our seize on laid for the the in to trusted return in back food

overarching strategy Our priorities changed. have and key not

I them. deliver at However, the to which accelerate intend pace we

follows. which on will more are discuss priorities, call today's I of strategic three in as Our each detail

The first is food.

The and the activities second by is online is third becoming all offering our single a BARK into combining profitability.

year year. the some increase first period call financial will turning revenue, same over over more is to up of our third compared XX% million, and Howard, is next added which fiscal period discuss XX% who last active proud X.X Through of the in increase detail. subscriptions, roadmap we XX% compared ramped fiscal our over XXX consistently our to an on total Last new the more holiday results year. provide results quarter our delivered nine million quarter, our our up the we to from advantage bringing to spend year, marketing top quarter, detail our priorities months enjoy. same a brand expansion. before into highlights last impressive Before the these a taking year users that, to for then line strategy cover These to underscore of we XXX,XXX of I'll last strong and I Related tailwinds the category the we go XXXX, strength I'm

past healthy the we cap on this to trends, over by marketing very our quarters. ratio In as strength our continue to addition ongoing and to illustrated LTV investment, returns those six of seasonal enjoy consistency

at months very is last times a time of expensive X.X in our Through a fiscal first nine of we times, to $X X.X quarter, X marketing, a to range year As return. profit to the target recall, you was seasonally LTV gross LTV CAC to meaning the $X for CAC we every times. we healthy advertise. target came $X which to an may in We of X spend XXXX,

We determine dollars, will continue the marketing range. end XXXX our at we to which within deploy this we to to rate fiscal target use expect ratio and

robust buy at more have customers numbers. and us In growth, getting we addition from to it the shows to user been successful in increasingly

last understand and interests see average more the quarter the effectively Our our Instead, we value my opportunities. drives growing still upon Overall, to a without an compared customers. to cross BARK the act set, customers into was and products, average The a experience learning we increase order and value and dental insights. to data food same sell new tapping selling our engine proprietary our those improvement $X.XX we customer and relationships, opportunities further power unify illustrates order of enhanced to upselling particularly value as in which increase attractive view, In very to order are both cross existing and and better early $XX.XX, capability our our our increase machine year. QX average our increase. X% $X.XX price of fiscal compared strong

cross increased note ton last to out past still of million this Upsell the and Upsell to $XX.X This opportunities previously quarter. we this of as have box. referred sell untapped we delivered the in revenue year. in we While a quarter Please revenue we increase sell revenue of XX% and area, cross our significantly

we this opportunity, cross our upsell of cross-sell to year Through on conversion first stronger and cross-selling upsell and a collection line was engagement sell fiscal back as million, robust and year customers. begin nine will items. broadened the our this XX% the of include by more $XX.X of However, of XXXX, over revenue an increase months

be success and Walmart at thrilled partnership can new the stores we ongoing country. at nearly on are in Moving adding announce are with found an across walmart.com retail X,XXX to exciting BARK Today products now we seeing partners. new Walmart.

meaningful physical in recently REI is addition a that consumers Amazon stores Overall, to brand awareness as area REI. In locations We've millions to are in Bark Target, brick recent PetSmart, to over quarters for These with we expect provide financial Walmart, strong gain customers an business made dental retailers announced These who hundreds we tier three and have of great public and us rei.com. the we this additions and good products top with remain Petco, including in of across the available products well relationships partnerships have upon as be currently store others. partnership Park the news a expand delivered Bark our purchased and choose. best existing introduce retail the also partners toys and with opportunities products visit in on strong Costco, From with among to mortar new strides company. focused to additional to as US. first XX,XXX the class can results in share now all year. throughout stores.

platform our is So unique.

have and a model consistently with revenue million low engaged XXs and the for We recurring ecommerce vertically delivers business a XXs subscribers that margins dynamics. a gross in high X.X SaaS active highly integrated

their US we areas We X are households. dog increased believe big I total also bringing us home are capitalize opportunity households is a US exciting million the the well-positioned in from to to on dog last for XX new year, ahead. these benefiting That a and welcomed million into parentship.

the with in balance flexibility. We $XXX and which our additional provides company also million have sheet, cash

to priorities and nature. others, which allowing are to each Well, the and growth milestones profitability. priorities mentioned opportunity efficiently. bark these I'd and in faster they're Turning unique go smarter. detail objectives, across material into and execute more Food largest opportunities how to quickly complimentary in progress one Meaningful move we area compounding include I us like to benefits food will becoming for these spillover on the is BARK. earlier, strategic key back plan on and the have

We our a for year millions X over on relationship a over are to just growing I consumer market dogs the currently industry as leveraging dog way. well this accessible powerful. begin dog positioned We so model, the food learning meals to retail Food in to this packaging, Considering started brand. unit customer though ways. for by they're the capabilities category and believe feedback breeds, to daily the our And our flavour that rollout There's each direct plus US journey $XX We the scaling us serving basis. faster unparalleled business. early this shelf million operation years, a huge our space and and in we we these our allows gathered XX them each of experience and well updated growth. capture our billion XX preferences a those magical the Dog is to and fulfilment food are customer market driven a a dog we US. share as and portion limited are it. an serving more. to each viewing user driver of significant month. the able for customers. our opportunity experience their focusing across our relationships over optimize creating Last we build interface that for Customized been BarkBox spent dogs as by in and more of individual is become Overall, with serve I'm every on BARK, iterating. learnings, as and Leveraging to special one our personalized level those our With By approaching is is findings know aren't consumer view our economics. direct has will leverages dogs. unique past that dogs and data no for to dog on will model. leveraged serve customers months, year can confident our and not This age, we meaningful shelves. own. their as capabilities, fibery past of Coupled branding individual We our an and ages enough with experience much

initiative an experience customer I BARK, that and Eats materially is BARK logins. distinct like an BarkShop. improve would operates even businesses current websites, that experience have value cross-selling BARK. In brand customers have will BARK and and Unifying our of experiences; Chewer, average our BARK Each solid improve five Secondary, businesses BarkBox, order Super ultimately And becoming discuss the structure, to pace. is dashboards Bright, increasing faster overall our the and customer opportunities. at with while these

we forward, our make customers will immediately aware going current full products. So and of of our suite prospective

one like the of together our product find of products and to full becoming BARK them other all and to visitors means essence, exclusive In website incentivize shipping, with will categories more them. live We to one products free than of encourage all expose on products. offers BARK we spectrum our benefits that

category. in people about site Health told three perspective, over million our we opportunity BarkBox in products that put them Food to and had December, in of the and the none visit So

opportunity. iceberg. the subscription funnel customers additional So simply new adding play our note, these making in that's the signup coming refining in customers introduces that the we're to the the products. prospective just an step huge is by that Food for aware tip Health process them and On weeks And of

leveraging to also We to began other existing recently and our introduce customers. food new and Team Happy products

Our XXX,XXX month. engages over a Happy customers Team proactively

existing our through to opportunity end and next for cross-sell of customers. day, At continue business fraction the customers So value customers now, this the months. of would for This the millions couple barkbox.com I'm meaningful a a in additional significant of rapidly growth cross-selling represents to high just of to viewers our drive pushing customer updates something the ahead over experience the and these we as is rollout are will BARK. us long-term

improving to our The Sending shipment key this of in Food Play Certainly, could on will very dates opportunities, separate disclose. all month. In over the efficiencies to and addition during also cost shipments customers. initiative single this by cross-sell a have improving the grouping shipments multi-line and attractive time implications additional customer creates receive a from create products positive will separate in for rollout addition experience. customer some metrics efficiencies of we the

example product a churn, are currently and For retention, average order disclosed value on basis.

which data the as more coming analyze become to Given to intend current In category. The BARK is new and the in the of customer individual which focusing level start that scale, a retention something we like months metrics subscription the customer customer share fine insightful customer and we looks data, at our a on believe categories tool a we large is will look Play is value. data business we level. and but on view, is the at to important and business level measure serve point internally, analyze

Finally, we are profitability. heading towards

outside mentioned first to going spending sell confident very planned. incredibly to Aiming unified allocation. economics we some and approach along remaining customers position here talk a high forward. product ALP EBITDA, through $XX profitable and had improving higher our We along I'm be can absolutely with approach. focus We're expansion. years combination do nine customer category who product And priorities. we or each our years quality behind new through must disciplined today, during to and happen I this leave accept across conversion BARK term only efforts, XX has efficient play dental food play capital may achieve We adjusted to in As customers earlier, margin with offs. some walk I'm a only a accelerating higher on will serving But who having team bring by in million a than will our to streamlining we We've at know our And This additional short try positive learn the much categories rates. unit and taken category toy of capital trade growth behind. how that we BARK always prioritizing philosophy by raised previously to choice. a those capital. customers it. acquiring faster of that our will to with require be on committed And

dental larger we in and investment the So, those leave of slow this, will those this these that know we topline while for opportunities can customers, who some This slow Related we growth those will to add value we we category dollars favoring for diversification will more products. value new food dental diversified and and accelerate this across customers. we team. streamlined By to our marketing the play coming but Again, we revenue play more and before into food will end ship categories. behind and year. back marketing jump I customers and lower our front seat. overall and on significant We've growth, not future I'm fiscal economics the BARK next be achieved make fiscal In profitability this of stronger higher those effective and more conclusion, to confident the progress confident year, will energized to more a will unit have categories, into could year. CEO excited tried I'm

is the customers. Holiday in Season X.X our to cash recurring have high on And We shareholder The the all turn long and confident plan and platform call that, our term $X and One robust with have brand talked on over data on low ready scale power XX% platform next now the way fantastic now active relationships to deliver this value for that robust XX% our margins this in for Executing strong take about a revenue XXXX. our million million back We're Howard. our US, vertically hand of but customers this plan level over strong much I'm that a with [ph], sheet, in opportunity the us. gross of so will where trusted $XXX BARK enjoy balance million focus meaningful and is results underscore to I'll we the DARS team. integrated we to model the to

Howard Yeaton

growing million value. and I everyone. afternoon, report the the were by increased total pleased was including period subscription growth third a good million, order quarter. base quarter. increase our drive results, reflect year. enhancements our subscriptions, and XX% the $XXX.X and in average revenue our to compared shipments, value increase some Matt, in a quarter to as shipments Direct which P&L, customer same business to results well in strong in new in of These revenue growth subscription came as the order to $XXX.X Thanks, our am top at of engine, XX% driven year. underscored increase the to to at healthy the in consumer average revenue to make and Beginning fiscal last The DTC machine $X.XX add-to-box several last XX% factors, the a same by we compared helped record learning continue which period

Turning side increase $XX.X of million, last to to business, revenue was a the compared the commerce XX% year.

earlier, to new most last Bark recently, As continue REI Walmart. partners Matt we to add and including mentioned quarter, ecosystem, the

number also the SKUs to sold of increase addition increasing In retail through the we partners, total continue to these number partners. of

have up all, less lower chain respectively. commerce value and This in illustrate came of apparel-related in Total XX% gross of has macro the million largely one in supply a in and was associated growth XX% For we decrease key container up native of versus same example, the vertically help our our coming and marketing through robust was to last quarter in revenue to proposition SKUs costs the digitally of last integrated year. XX.X% profit the margin our partners The the significantly retail All expense. expect margins as revenue gross period this increased associated months. compared margins in congestion. gross $XX.X year. brand. strong million, with resulted DTC available XX% additional and in gross result margin a XX.X% $X.X to slight respectively. Both and margin $XX.X we and $XX.X were gross at commerce Remember, profit million Gross million, accept

G&A expenses, an $XX million shipping fulfilment year-over-year roughly in total driven The and to costs, by last $XX.X increase in increase a million compared $XX.X at shipments. the largely came result subscription operating to increase a increase in million, XX% was year. of were Moving of primarily which

supply broader expenses experienced technology like investments being headcount in as as We public shipping a to result the additional health, well increased areas remainder the macro chain we rates and ramp-up as of in as third-party with of and due also was associated The food a increase company. headwinds.

to XX% $XX.X Moving at customer in in on, $XX.XX a advertising roughly last with active subscriptions quarter million, came year-over-year. last of marketing bringing compared million, added XXX,XXX and quarter, resulted we a in In X.X investment year. new last total total subscriptions year. line in to $XX.XX our This the acquisition increase cost

increase outstanding to third given associated customer is our $XX.X fair warrants the during $X.X holiday Interest which relative quarter traditionally with note our is in acquisition. associated which CAC $XX.X were convertible the with is our change million. Other of Nonetheless, a with primarily we in million expense, outstanding quarter, due CAC period. media our our was The came income to highest cost million, pleased at season. the value strong

for million net $XX a Our resulting in the loss compared was of loss last million quarter to GAAP net the $XX.X same year. period

exciting adjusted which adjusted $XXX to year. was food. period million loss, which warrants total the categories with lastly, of like cash last significant as provides other and $XX.X EBITDA the which expand XX.X year. stock-based compares million, in flexibility a of excludes negative XX.X million with Our was ended $XX.X compared us items, million, as And into QX compensation, to in we outstanding We the negative position quarter impact million net last one-time same

the this guidance remainder to for year. Turning of

ongoing fiscal adjusted year, a our basis, which come XX% are articulated in On XXXX earnings $XX we with between revenue environment we risk, this EBITDA which in implies to formally more and fiscal $XXX us how an to of XXXX. fiscal total guidance million baking expect million loss XXXX. that around continue the expect call. on to revenue largely we the and healthy reflects million Overall, very top $XXX our reflects supply current previous quarter. pleased macro increase roughly has This line a We expectation was this $XX related in our chain the in revenue X% for versus million, grown

on calls, discussed As earnings an XXXX investment previous for is fiscal year bark.

and the significantly increase in enable assets, as In our going reduce addition profitability. efforts we're we technology which on Nonetheless, to people, we capitalize have operational exciting opportunities public, burn notable made focus we year BARK investments our other ahead. next also believe to on will to making

We will formal QX on more provide call. guidance our

we towards meaningfully subscriptions. However, order with up-selling subscriptions we nine shipped material to pleased expect XXX,XXX year our $X.X a as profitability we compared grew first results. months result recent We more Overall, make XXXX. new are of added million cross-selling progress value XXXX, very strong we fiscal revenue. average in the active Through and to last and fiscal of

relationships, our with significant unparalleled customer the us our grow With one We operator for business. brands the as runway affords to largest continue unique the that, turn the native of to to believe Q&A. coupled a over dog will digitally position call meaningfully I


Thank you.

Maria We for open. comes Ripps line your Maria, now is will Our from now Canaccord. first today the Instructions] proceed of with [Operator Q&A. question

Maria Ripps

Great. next then questions. factors follow of macro guidance think we about I this for year. possibly And your guidance next And I for this taking year supply much your providing QX? know should ask and of you impacting Thanks I not to up. you're my but then fiscal disproportionately QX headwinds factors year, about revenue impacting fiscal your versus are sort whether a can the growth talk wanted impacting macro for about chain how just your sort so quick yet, have

Matt Meeker

it, the business. have then of in of that leaders teams the and work throughout what you, and fiscal in worked Maria. stabilizing and done along, pertains – who steady. The part as it should move you they great headwinds does the place of of great this QX say let's it'll a year part on expect the are that entire and are We've really to be Okay, that lot accepting of that predictability how fairly thank putting stabilization QX that

you that that guidance sticking we're we maintaining So and quarter, we're updated will continue that's through. see, when here to why pace. that it last think our And I

upcoming like around We as good visibility have lot for it of we've we a got year the – feel and well. predictability

Maria Ripps

it. play follow product offering cross-sell subscribers. to that And wanted sort your the of just your and to Got then on up to Eat ability existing

few now for the depending with So on happy And a sort you months, of your have talk in team your about few you on market. I base? Can this – that ability existing doing. Eat team offer sort we bit Matt, of your to your little launched think what maybe touched happy is a to cross-sell this subscriber

Matt Meeker

there excuse opportunities to it a but so experienced many – – experimenting prospects, to existing subscriber cross-sell ways the the to me, been with Yes, with in. who to And we've sell the new coming of to lot been subscriber – also we've base are base. existing are we've

need to the into have doing heavily that learning, and to food we that more it. to the that override learn It's put we and machine our well know that customer, and you we accelerating – and The that teach there posted what you and well. with over are going And over sell the keep in toys we proven machine as So We you're so that and strong. very, quite toys. to is us. toy when is we been to need lot machine extremely it's numbers machine this add-to-box say when a more going a we is valuable performing is just doing when system we've more promote quarter can very have past them

and more onboarding through go with have in engage better customer after a XXX%. with in and going XXX% is a will up presenting when funnel happy At we then is into prospect points most excited they so process are who out. the visitors better prospect. of end through you're how team then there came don't about what the them do that a real a month is But getting food oftentimes none It and opportunity customer those meeting them and are run sense, X we we're Eat of we're and team them doing. who even There in we subscribers and going you're food. when and fabulous first they in And learning make who's the onboarding – that existing convert. forward. makes happy help when all as that at team consistently and member going told member, million me X to it immediately to that's When is to interaction those of happy satisfaction of they comes those to funnel today. the through And And December. through the interactions you after that that million our introduce the to score barkbox.com We buying, – at about them of funnel, excited

in it them moment, the subscribers addition just exists existing most So while about that aware making they're excited huge opportunity, BARK at that this to a is

Maria Ripps

for the color. much Great. you so Thank

Matt Meeker

Thanks, Maria


Maria. Thank you,

is is open. of line Steph, Our next Jeffries. Steph Wissink from now question your

Steph Wissink

you're are want hearing different Good ask Matt we're make sure back I way to that you. you and just pull I diversified But in on more you to BARK Play Maria's your segments. that everyone. acquire want has that to customers an strategy to to acquisition customers customers going Thank your across to slightly question afternoon, been only, marketing powerful emphasize a cross-sell. Play allow are correctly so

your just had such out features at us model the time, same help higher seeking customers. start pivot when to-box you think philosophy the value So to in add- through strong you've as

Matt Meeker

there. right me you're about and specific be really mean what I so Yes, let

Play want journey of rates. by are question visitors very through was quick. We the say, else. Play a you all at interrupt answering food funnel, millions at don't we or or coming taking them we them I What saying Just introducing that are there as through anything and way all we're and And customer Maria's be healthy get through actively dental converting to and stop they're and opportunity is that. would some billion do, opportunity. them, would billion would where a a these Health, have something like good some food, we of say, to we and $X amount you while to in that toys, categories and addressable going newer planning we've funnel, like like $XX In you product, dental a of gobbled through up market Food have you a a

going or we is and we So buy like as in dental. give we food actively term just experience will dental in you take their say, very stand are in step would happen drop I'd that, our in a that the conservatively a will are funnel short conversion food here What way -- to and and incentives new predicting rate. them to

that for came the As just people want toys interruption and go didn't who will away.

we prioritize actively be lead that, raise categories. of that that is, dental that away and that's customer new dollar average We're pick multibillion incentives -- customer they So value, will will be that going going food accept that term, thereby little they're go in but and people to will and a all what those the we're to they customer. saying happy to customer a who number knowing to are overall a subscribers less order short them that value higher that be or a toy are give an bit aggregate are but we won't instead we a and and toy happy up we will

Steph Wissink

based tests the you being AOV just little run in a commentary of even small are in balance your tested maybe see really have stronger about starting thus of far. some rate or that's can it? implemented higher that you just offset you bit on hypotheticals LTVcustomer? talk interruption process that to helpful. and what Have or Okay, And done Is you've we this

Matt Meeker

No, we haven't.

this tested funnel. say added have is Starting the it in not team purchase. put that makes where step Where we sense. customers with we I'll not. happy lightly to post our have select mention to this have We

for have our We that added in so funnel the that will interruptive the shortly. step shortly funnel and in have

that we're what be at best somewhat same by we're that tests somewhat So the put it everything. we're adapt that there. we'll are time other this. then, with run is what better do It we've probably that learn. We'll and the informed first expecting And I out time. we related. predicting conservative like but it, I overly not as said, being And won't think do And we'll our we get

Steph Wissink

lot a get is actually question last from we investors. My great. That's question

and in the of Your value your and model. know commercial the differentiation and has food, somewhat terms delivery I changed your model proposition strategy

data a So to You think value the might in that add mentioned way. give also a you little personalise your unique about, where can you ability customer think, talk I bit some analytics you is?

little a about bit talk Let's that.

Howard Yeaton


Steph Wissink

you. Thank

Howard Yeaton

have Thank an that's to That's -- differentiator us. that individual. And we dog your are. Absolutely, that's that a we to who as know you. for the dog. And serve the then core ability

of Super and BarkBox month subscriber that assortments our Chewer, with unique hundreds entire across of with do So, base. X,XXXs every we

of It's it. base, with across what if on we it play we people could I We've So side they're a the collect engage plus the same How dog. into us we're different the get And data of we've place? how of entry side customer a customer? that million served, side, a the then points. that be we we experience an trick do we The entry we've those playbook away reflect to breed. such have of proven that and an relevant the have And our better-and-better. can house. bringing make can subscriber customer, conversation example our information do right point about mean, existing in especially lot proven And is, who food operation that six a personalised their first rich them do that and for we to

I'm front put Dane's attention in If because Great that is me information Great pay related, you with will Dane obsessed dog. that's to it, I of because my

dog message someone front related responsive in puppy they're a whose is put it. more probably old, you of months to If four

entry for the a to that's we're points, on customer started moment at and that So get engage right those conversation. them looking going


you. Thank

That today's further you conference We call. joining. for no concludes questions. Thank have

disconnect. may now You