Boxed's Financial Highlights for Q3
For its third quarter ended Sept. 30, commerce-tech company Boxed Inc., reported retail net revenue of $41.6 million, an increase of $3.4 million, or 8.9%, versus the prior-year period. This was supported by a spike in order frequency and a higher mix of B2B customer orders, both leading to a strong increase in retail net revenue per active customer.
The company, which specializes as both an e-commerce retailer and e-commerce enabler, also reported that its retail segment gross profit was $4.9 million, an increase of $2.3 million, or 88.8%, with gross margins improving to 11.9%, an increase of 503 basis points, compared with the prior-year period. This was also supported by momentum in B2B as well as Boxed Market, transportation cost savings, packaging cost savings, and ongoing price optimization, leveraging Spresso technology. The company believes that the cost savings initiatives that benefited its third quarter will also better position the Boxed business over the long term as the company pursues increased profitability.
“The team and I are very pleased to have met or exceeded many expectations on multiple levels in the third quarter. We are also proud to share the quick progress we have made on the strategic vision we announced last quarter, which increased focus on some of our fastest-growing, stickiest and most profitable areas of the business,” said Chieh Huang, co-founder and CEO of New York-based Boxed. “By executing on the strategic vision to increase profitability, and as a result of certain financing cash inflows, we are also able to cut quarter-over-quarter cash consumption by more than half. We continue to actively explore additional capital markets opportunities, and we hope to further improve near-term liquidity, with the goal of an additional capital raise prior to year end.”
Meanwhile, the company’s net revenue was $41.7 million for the third quarter, a decrease of $7.4 million, or 15.0%, versus the prior- year period, primarily driven by a decline in software and services revenue.
The lower software revenue also contributed to a loss of $16.4 million for adjusted EBITDA, compared with a loss of $3.0 million in the prior-year period. Other contributing factors to this drop were higher growth-related and public company-related investments, including staff, professional services, insurance and IT costs.
Net loss for the company was $26.4 million for its third quarter, compared with a net loss of $5.9 million in the prior-year period.
Boxed is reaffirming its previously provided guidance for fiscal year 2022 as follows: Total net revenue of $165 million to $180 million, and total adjusted EBITDA loss of $65 million to $80 million.
In related news, Boxed Market recently opened its new fulfillment center, in Westchester County, N.Y., with its Brooklyn, N.Y., facility also opening imminently. The new locations mark the initial expansion of Boxed’s rapid on-demand grocery delivery model beyond Manhattan as it continues to grow its assortment and fulfillment offerings to meet customer demand.
