FLWS - Earnings call transcript Q3 2024

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Operator

Good day, and welcome to the third quarter results conference call. [Operator Instructions]. Please note that this event is being recorded. I would now like to turn the conference over to Andy Milevoj. Please go ahead.

Andy Milevoj

Good morning, and welcome to our fiscal 2024 third quarter earnings call.

Jim Shea, and CFO. are President; Tom today Bill and us McCann, CEO; Chairman Hartnett, Joining

today's by Before you in the on that begin, our some are we I'd public of statements like press release we documents. disclaimer safe harbor the to and remind call contained covered make

our including and forward-looking company risks During to in events. based are statements These Commission. of make predictions, assumptions with or are and and to statements those expectations subject that this the Securities uncertainties filings call, contained made forward-looking press public disclaims discussed release we other and the call. projections during and that be Exchange update statements on The may with will statements obligation future this current about any any

discuss can supplemental prepared earnings of in non-GAAP Jim. financial our that were will call over with Reconciliations directly we most be I'll release. And measures the to now measures certain comparable of not GAAP. financial GAAP found measures these turn accordance the in tables Additionally, the to

James McCann

Andy, to a Thank and joining turn I'll over This morning, quarter will who brief you with our then good everyone. a Thanks, us. begin performance overview it for business of morning, update. provide Tom, and third

the will your open it questions. Bill, We up with financial and conclude to from review then we'll

efficiencies experience driving work innovation Over that the and last few all are the quarters, providing our updates smarter business. initiatives and customer on we our relationship aspects been on have centered of elevating in

managing portfolio our and today. how number updates continues to on product you'll these relentlessly and actively hear are organization execute a elasticity. initiatives, Our on pricing we of our

we consumer their Consumers income although the consumer there our at be and time, the resilient continue environment. rates pressured very most same see continues not about with higher has continue making our consumers. a by the versus credit to see surprising economy, look and And and continue to inflationary we at discerning lower delinquency income middle discussion balances to decisions. It's a much while been bifurcation rise. higher forces third we be are to the card deliberate quarter lower of and that rates interest thoughtful on purchases performance, As are and complex

quarter third includes BloomNet total revenue declined Our wholesale and which lower X.X%, revenue.

will Bill fiscal to softness, XXXX revenue our highlight sequentially. offset recovery. further of margin As our year our e-commerce the improve line trends gross remains Helping top continue

As year. beginning our had rate we a updated last is fiscal faster we margin occurring pace of of the than the at in anticipated quarter, at the recovery originally

margin gross largely smart the more from of combination reversion and costs. benefiting operating the work a commodity Our of is our initiatives centered mean are to certain efficiently that on

we one third Smarter, of the action during further As Work took workforce quarter. aspects the our optimize to of

current were their these to and our I allocate organization's made are success. take personal changes to decisions gratitude these team response our want to our opportunities was difficult, in to who resources appropriately to While this environment business. the to member in express opportunity the affected contributions every for to growth

are gift-giving we of forefront in initiatives more our to the for solutions our needs. innovation. executing efforts, cost Beyond been the customers' the on of optimization our have we founding strategic company, Since offer

our people in expanded made important customers options lives. have easier and the their all and it celebrate We gifting for stay our with to connected

ability our to personalized we enables the to offerings pair offer our with personalized Print brands and a as our will our We a Isle greeting. gifts family greeting wider customers customers' of of range Card have with further occasion. Most variety offerings acquisition quality of needs. for cards which expressive a stand-alone card portfolio gifting gives of recently, our The on greeting of across us our or enhances Card addition Isle, expanded extensive options of address Demand every brands top the and

are we Tom initiatives. provide enhances experience the excited card gifting on greeting that the our further customers. expansion strategic our will our in provide can category for We additional information

update, this David's to XXth I Before first celebrate at opportunity the did want what the ago, Harry heart we & we a has milestone to Harry & XX of do. pairs take of the celebrate I delivering business to anniversary. remarkable been boxes of century -- truly a years time hand-delivered gifts. move sharing From on to It's David of nearly

has Tom since to update. that people all here changed delivering David the business has Harry call I'll While together turn along bring extraordinary much moments. And for life's now been our gifts XXXX, at over & meaningful

Thomas Hartnett

we Today, Jim, developments, morning, innovation offerings, on which product on Through well our good efforts as as are of elasticity enhanced or we encompasses well enhancements. ensure as actively merchandising appropriate pricing as each to performance these the evaluate offerings, and business Thanks, our our our that update have and managing interface we everyone. our product of segments new points initiatives, user pricing relationship opportunities bundling our update customer and I'll an continuously provide portfolio. price for an

performance. our Turning to

an X.X% During line despite decline in X.X% year $X.X our EBITDA we continued revenue the trends Most e-commerce revenue. generated of improve sequentially, for prior the adjusted loss with third quarter, the to notably, declining in million quarter. essentially

retail AOV. our long-stem included gifts out. purchases sold ability and we our Select between reduce compared are in their Day selection premium Proof that at increase to our roses our offering our to our trends, see luxury look our priced our which that higher and buyers XX% offering, as demonstrates pricing and than and power higher continue bifurcation we This most Shari’s of what's lower-income Valentine's these income to $XXX the XX% customers middle and to to standard point As for appeal Berries customers. to XXX was our a driving

our as towards customers higher-priced customers this affected much more We in gravitate our trend, that meaningfully behavior price a and ongoing bundled continue by overall not income they of our products decisions. higher continue portion a more in upper the in result their deliberate greater changed macroeconomic that cases, AOV are gift income have recognize our their represent are X.X% a with trading customers who and value. being environment to provide are As increased many our lower to of population buying great up points, but our income

a price lower result, for we not at also gifts only ensure price As we that customers, are our consumers higher for we luxury-oriented our expanding to occasion have lower every appropriate points. but for points flexed income

providing on and greater. been the Our customer to luxury focus the at the value price spectrum never points gifting having thoughtful of appropriate each has end options journey,

and to our world-famous selling evoke pairs, we life offerings, of utilize marketing expanded available lineup extending with technology to our season same-day products efforts extend the and increasing During the their quarter, motions gift for we our introduced revenue, new product delivery. our we brands, greater innovative amplified

we Let these. In make also Cream, Cookies me take on with which great Cheryl's a to paid each be a January, can gift launched moment Ice of to touch Cheryl's set.

We period. This will ] fiscal customers longest layer us on our of extend anticipating on an strong sales benefit gravitate grow family continue greater higher we as season ever At introduction to the year extended to XXXX quarter the grow categories that customers crop We income pairs this And Royal with accomplished our responded to using a continue offer as to and we enabled to the ] experienced towards technology to than technology yield a even combine had weather offering record. of pair we past winter. to [ the our spring. higher-priced season ago. our higher-value, see we a have This of complementary we Cheryl's our for favorable in bundled orchards this gets Riviera that enabled longer are the due gift Harry us more pair assortment to set. cupcakes did bundles selling the them into [ had our our brands selling David, conditions as & by

Valentine's and our are family XXX David bundles offerings memorable To to our by experience, it bundles our a our which in single with gift. Trio great we products from Wine Flowers, also and that brands For investments of X sell-through. inelegant competitors we all only expectations sending costs a differentiate shipping provides able reduces we've as for send made gifting delivery. the Berries, This not the but reintroduced much to our more Harry and leverage supply exceeded & chain these that of Shari’s Day, extraordinary featured better

to Turning marketing our efforts.

saw customers channels. customers relationship customers convenient. strategically an and A storytelling and with emotions, catch our website, ultimately are was the We brands our of a social action. impact interested on make stronger foster storytelling within that Effective launch the options, Choice a meaningful incorporating and to to health better-for-you and customers. generate healthy, are elevate of we on is brand Vital healthy with our featured bond wellness with with Vital in creates of this example and or great natural provides hundreds a our and evokes Choice's food opportunity our who stronger external blog, our

ocean we come Beyond has the become and how today's and fast-paced important providing share the facts fish the responsible information deeper are such cash, suggestions, who with dive fisherman customers wildcard as of serving differences useful and to farm nutrition story product and the between for they to from it increasingly and convenience customers bring sustainability for their expect to customers' fish, have plate. Same-day the help world, efforts gifts delivery in speed. our

number management for our of been the or are focused available of of to for a By component our that same-day products expanding our whether a occasions, special last-minute team number leveraging products we customers same-day it's As delivery BloomNet gift sudden help on celebration. the celebrate a initiatives, delivery. has have expanded network, strategic available

we of that and our for to bouquets. same-day cookies a X-XXX-Flowers features part option delivery select Cheryl's add-on cookie As launched this program recently best-selling the effort, our

turn but of the is e-commerce to customers and capabilities of convenience products, fulfillment of we time, be destination it platform, over our and by expanded provide importantly, build the brands their ourselves are our marketplace great this family review. choice. And array to to illustration differentiating how to I'll in gifting to this speed expect We leveraging most a our financial of now Bill offer over an

William Shea

and good morning. Thanks, Tom,

operate [ we which to continue As consumer continue curtailing categories, consumers have Jim spend and their others. while spend Tom complex to highlighted, environment, certain a in on in ]

We also which customers the to continue higher customer income our gravitate our continue towards in in and see our to higher-priced offerings. file spend divergence

consumer, Easter. year shift X.X% Helping improve, with the in compared mitigate as core as improvement ago. BloomNet partly zoom continued in third our closer look our to at X.X% this a well a as quarter we wholesale due e-commerce includes to retail and the to declined prior the decline. to revenue of a volume little As revenue result, was partners our third This as in quarter-over-quarter trends past revenue. When Easter revenue for declining The compared the quarter. X.X% lower lower quarter

improving external extraordinary moment mean, want rise freight cocoa to efforts, the basis to reversion issues in investors' points certain costs, chain. its inventory the the a months, XX.X%. continuing a that past our discuss XXX Beginning a and is well that couple margin led as chains to impacted was improvement as costs. I efficiencies commodity lower to the by gross of factors attention including Our supply had over The take the Sea with decline optimization supply Red few in prices. labor captured

our ahead the We happy fiscal issues despite that for report our in successfully year negotiated negotiations costs logistics team with are freight inbound East. geopolitical recently lower fiscal completed rates and XXXX the Middle to the

the moderate terms price our in fiscal and fiscal fortunate in locked and increases were prices, we cocoa dramatic to with cocoa to XXXX In XXXX much prior more increase pricing. have purchases recent of

look price increases moderate in to other areas. offset these will We

resources of As full-time business growth to current and the opportunities the the conjunction during initiate This within related $XX to response decision yield incurred to annual and quarter. environment. business. In with of a is in this workforce of expected our action to $X.X Jim to million. the action, we a made allocate savings mentioned, million the company appropriately more our severance reduction than charges

and XX.X% the were of in in as $X.X compensation impact Third which intangible XX.X% excluding the period depreciation charge. Operating plan to with of loss year benefit $XX in impairment compared share just goodwill fiscal trademark or a $X.XX the includes the per investments XX.X% second charges, severance-related prior Operating loss charge. which $X.XX impairment was period, million period. in the million period an sales year per after-tax and million our million which and expenses, included which compared includes as company's of quarter to as impairment year quarter net per of noted, net tax goodwill year, a appreciation million sales the same or Net related per share and $X.X or the $XX.X of expenses, the per million prior intangible share charge $XX.X to operating loss of was charge severance in the compared year net million. The items with the $X.XX or was $XX severance-related the charges loss asset $X.XX $X.XX prior of for share, In noncash share to prior as expenses were the adjusted impairment nonqualified well per period. or excluding includes year quarter adjusted $XX.X prior the compared asset related million. XX.X% $X.XX recorded declined prior and charges $XXX.X share of as the or

more and line margin $X.X EBITDA helped $X.X EBITDA top million, an loss loss a efforts efficiently ago of to the adjusted recovery operate year gross quarter flat decline. adjusted third the was million Our with essentially compared our mitigate as as

review segment let's Now results. our

Foods margin segment's commodity to with this our environment. inventory period, $XXX e-commerce retailers large a reduced as $XX Gross freight million costs. A prior decline costs, Our the in $XXX.X to X.X%. compared declined Easter compared with was orders efforts labor which their XX.X% revenues in million light basis consumer This points optimization Gourmet business, in segment company's year the the XXX XX.X% declined year XX.X% as have contributor as lower several certain Baskets declined expanded of for prior the revenues from well decline in and and approximately million benefiting profit period. wholesale Gift to

BloomNet, in orders of expected our Segment profit of following with order segment contribution lower severance of business million. XXX product Gifts XX.X% year current period margin in $XX.X ago, by Consumer margin expanded primarily year included efforts. a their period. In improving million, merger Gross margin to $XX.X the contribution loss $XXX an decreased excluding year. In freight volume compared compared processed charge a was mix the adjusted year improved period, X.X% the the a Floral $XX million in segments, million adjusted compared margin basis year to and $XXX.X charge compared in period. was with decreased million revenue excluding $X.X and severance compared loss $X.X points and the Excluding in segment with with revenues with segment, competitor. to segment optimization year million of Revenues $XX.X quarter was XX.X% profit XX.X% XX.X% charge our the logistics on million XX.X% prior contribution ago. lower million and in million margin the charge BloomNet million the our to the the for with with Gross partners a margin our in $X.X the margin impairment impacted prior one period, contribution by which impact were the costs. decline of the compared loss prior prior margin reflecting contribution prior Segment higher lower by loss an fulfillment year $XX.X severance

balance our sheet. to Turning

position million of end inventory third at compared at end $XXX last the investment year's the with declined was million Inventory quarter. quarter. to and third cash of $XXX.X $XXX.X of the Our million

debt, terms term $XXX.X debt credit no borrowings we In had in of under facility. and our million revolving

As third end $XX.X our was the year's $X.X quarter. million last million net at debt of a with compared result,

of and million fiscal quarters program, our X cost share. approximately This on continue through repurchased an our of year. the XXX,XXX per first stock we execute at that buyback we the $X.XX to stock We to purchased shares amounts $X.X average of

fiscal Now XXXX our let's guidance. turn to

the decline with range the X% to reaffirming revenues are as X% to year. We and continue our prior total in compared expect to guidance

back the and million. I $XXX range be in his million of million, now for for it we to our in the to to cash Q&A. open EBITDA $XX $XX free million of before call flow adjusted comments Jim turn range will be Our $XX to to closing up the

James McCann

Bill. Thanks,

It's to and you I most to that as us to to our one of that has and have trustworthy Newsweek. want more recognized customers your Before their we and to in up who this that company Trusting to relationships. been thank questions, more want tell incredibly organization proud opportunity this hard by an this open congratulate to better companies I'm more build for of on take momentum. a we recognition. X-XXX-FLOWERS.COM everyone I to it look work connect to matters, strong such America's share trust them help honor and a contributed give forward continuing to community build

Now let's operator, would, up questions. you open for it if any

Operator

Instructions]. [Operator

Our first Kupinski Capital question with Markets. comes from Michael NOBLE

Michael Kupinski

can Can a commodity you in a might for was what were talk prices quarter, weaken about, impactful obviously those stubborn and which quarter. of looking I were the in but talked be that obviously you going maybe the to prices wondering not prospects and you little sense and give lower prices little some continue commodity trending, weak forward? just bit us commodities about those cocoa, particularly just if you of are future that offer like that commodities a the

James McCann

you for year year. locked the cocoa impact be, the cocoa quite has Bill in prices Commodity all extraordinary. thank us would I tell mentioned, would in And fortunate though, plan we is next week, cocoa we're in up This for on Michael, And over have been Jim. our bit. your change to a and through have have been the on prices availability you, as our last what place. the We prices next just question. that pricing

butter to in couple over cocoa pleased of it's chocolate very where days, we're and conscious and from baker and and know components X XX% because swings pricing you're our what little those seen But are overall now a A are market have impact we've see last decline in going our in you're to prices. it's we're big prices, the and a maker, that forward. wild on what wild other little bit the So impacts on Bill, of cost going when But impact overall there. commodities? still protected future. those of very it I the eggs we but color very swings, conscious some might

Unknown Executive

this Jim, commodities. the the and past what's butter kind the items as in -- where They in down egg we fuel you are side, continue fiscal to slight year. tailwind a ones getting the significant benefit that's of on third significantly there now, gone And have mentioned, fiscal over right a combination year model. some [indiscernible] risen. a both combination like fuel, fuel headwind benefit -- point that a carriers those as the -- of both were surcharge continue this for most with to happening other getting up But it's markets. of and head that year But has on come this crossed they to that's the of a [indiscernible] so 'XX. it's play we And a headwind from had. into benefit

James McCann

answer the our of commodity it's such question, to a biggest, is being And overall mix. part negative a fuel on still commodity overall, disproportionate because fuel costs prices, headwind Michael's commodity

William Shea

As headwind us we move we move has forward, be fiscal But forward, again. a to I will think as a benefit 'XX. fuel been fuel in

Michael Kupinski

including negotiated forward. of was decrease me just give sense in you us costs? sense wondering I you going can the ocean surprisingly, give of a Can shipping costs costs, freight you the lower rates shipping a

Unknown Executive

Who a I would Michael. we'd a X rates Red or months never just week lock that that be color and a contract me, certainly those ago, talking who were thinking negotiations, very year in knew for that surprising. a forward to but weeks Bill, predicted and there about found surprise lower. X.X finished the little these it's ago, ago, that we Sea have Michael, going

William Shea

Yes.

contractual ago, that dramatically, market the good rates everybody that So contractual the rates. rates several did ocean for probably months jumped had. honor The carriers the is news spot double the

market we So impact didn't spikes. those feel the spot of

fiscal the As for our back we as able were a where to slight fiscal 'XX. go but head we -- were 'XX, March. in for -- that rates X we we rates use, into several entered ocean across into concerned decrease We in negotiations, successfully our carriers negotiate would

So -- XX X, next May those yesterday, and into effect May rates actually run went through year. of they

year. of talked been On talked fuel, the logistics been modest our always under on rates. the contractual side, are and initiatives, initiative surcharges little in rate those between FedEx shipping with about increases a have -- optimization, We Work outside that there we've those to rates. other outbound able Smarter offset we've are inventory bit But side, past we've we this

through the slightly package the the at actual year-over-year end on quarter, to third So months lower our a per is cost ended basis. flat of X

James McCann

manufacture. to purchase, inbound those is freight Michael, done, mitigate Tom where that ask costs. we we've comment And [indiscernible] to on we where I'll this

Thomas Hartnett

Yes.

sting So Michael, and feeling we as pandemic. still time the over from the

We a have chain. et supply some shifted the to from volume of our states, cetera,

So bringing raw was of it we've where a in less just number even sales. been sands than in we're containers

So.

Michael Kupinski

And you. question, just Got if final may. I

actions your quarter. in cost-cutting the You workforce implemented could actions in How permanent? those as viewed be of much

James McCann

can our can a part more workforce having efficiently, appropriate more is thing Yes, that's in how obviously smarter we'll to going reduced and is but look constant operate to we structure our in continue cost say our talent. to initiative do, our be salaried to result we Jim. this where cost ongoing us work on of a And productive. Michael, eye we our this quarter, how -- under workforce painful

in last any severance quarter costs it the that that. also impact along on we the go same So have quarter, didn't have related because with

an any about in the ongoing in On costs So basis, reduced payroll we're permanent. and it have is didn't all the last that million at quarter. operating $XX level, benefit estimating

Operator

Craig-Hallum. Our question Furman with Alex next from come

Alex Fuhrman

on economics if table It think cost your your time? wanted happens over of compared same-day orders ask becomes is do it about rest many delivery. to industry What to the where the are business? And seems heading. certainly like like look what stakes your ways, structure I to in the that's you

James McCann

Alex. Thanks,

a forums going that to thing it last the years of couple be now. think I been we've these that table for and said is is in you few saying case absolutely stakes, the

a towards, the color model forward to what it's and Tom? we're is positioned are Tom, day portfolio in the up that. doing but would say, us, we're about by give us And there. well the of little for costs real is, in what program, in the we're we're become impact we're But to talk you last products stakes particular, them seeing you of something is it's which our more we you with better we've will our early gives if looking and leg now mile putting what and endured same particularly very working a that Tom our as serve the on So day and other BloomNet our increasingly stages. network. across customer Alex, think particularly table same benefit our community, fulfillment, unique

Thomas Hartnett

Alex.

on are just floral floral we obviously, helping day them in time, involved we've a in same very with at manage our this, delivery something is been our partner So long -- cost.

something So all that's for we're day. the same time

we further into that a further and So move local as that gifting of push into other learning items leveraging we we're can markets. lot the

those with success, Shari’s seen Cheryl's Shari’s Bouquets bundle had early the with are able cookies. our So We've obviously brand where we've products. been to success products, Berries our confection Berries products Fruit we've products

we ship -- fulfillment, learn our item that really in be than somebody Obviously, we a greater. customer BloomNet cetera, to ways that to to into day. we economical We wide about more network And probably much we customer product. have which provide the the economics different if and volume that weeks, can think a of as grow get how rings we same something wants products. There swath the speed of upon can continue we in the deploying it our delivery. for will be leverage et the way based So pretty in of those and X we always chooses better

Operator

question with comes Davidson. next Our from D.A. Linda Bolton-Weiser

Linda Bolton-Weiser

Yes.

Easter. club your that that with So Christmas. you're that, of mentioned for those are sales programs part back well I the -- any kind a are bit on an retailers anticipate the you pulled sort along in things. was this side thinking programs going a the for I'm just And wholesale you of I little about getting some if important on read retailers wondering of club early curious Christmas? do what about know decline -- for ordering

James McCann

Linda, wholesale piece excuse in us an your that of a business the is our coverage to answer gives and for question, infrastructure.

not So reliant do on offset we'd to to well have with not help without other us we're wanted something that to the it's do we something operating it's than be very going it. expenses but or and better,

So weren't it's only the the is calendar important sell-through that during we're 'XX as in last Christmas we that big in for. hoping strong respect. saw boxes as year What holiday

calendar on back dramatically they cut period. holiday their So for buy 'XX

year the sight complication Easter, the So that was like way Easter They when that that on Easter sales to Easter tends had big box because of us I we as up we good because out always we a holiday knew Easter has on was to depressing it's as question, had going FICO think, a And moved people. a in something for back we Then a this indicated as headwind what a guys, and because before ago. the impact that you good then season. into cut about line have early sneak this your order. would look to several on months up,

do knew for we continue asked of headwind asked, So have our as coming question we line ask that in in. In I'll be about year. what you this a the to talk for to important will it Bill us. they And sight to question when of answer what underlying

William Shea

Yes.

Easter. and into some took the reduction of second the $XX in We talked end holiday in about in will we orders year, at as back sight next $XX orders of because a year. quarter, next million about million line we no, hit of about be reduction and those up this a So big QX wholesale do year have box

orders yet. tailwind. not a It So it finalized been Those be be will have will a not headwind.

of the extent the year, next get a will tailwind, headwind. we it increase to locked don't a that that So we'll not have yet, be but in

James McCann

pandemic high anticipate to But back don't getting it of its -- high. we

William Shea

maybe recapture the expect it No, not the fully Yes. to -- we high. from recover be but to up

Linda Bolton-Weiser

bifurcated I been and the the your And the Mall between P commentary I it's I then comment lines? there about in high has on think Okay. it's line, is of big [ think called in side, difference on Things versus difference a wondering Remembered or given those was consumer the And kind Has you big low, other personalization a ] doing something of general? like there that how that. area X performance can been

Michael Kupinski

Good Tom But course. color. I'll ask there, you give insights of Linda, to

the answer Tom? think But is I yes.

Thomas Hartnett

Linda, a a true, with is as have personalization consumer lower that to think household I Yes, the tends income. business mall

We things bit the right impact personalization more have that still seen is remembered say, a But there new. of I'd so on -- little because now, on business.

we IP, get remember, our and back, it sea legs you year that to If was us. we're and the just starting a acquired under just

seen things -- see pretty with growth a a in big our we in there in AOV we're appealing -- remember. have that very is delta pleased that to different We for and or average demographic,

James McCann

on select we're Remember because these your it, into you It is get ], [ inventory, to pleased of very business under get So with comsat a it manufacture how have that years it, Things stock. getting to couple takes legs started. import

it's the the but holiday how next the out to is has feel have What item So gate, we're it of season us pleased doing through selling run, coming really take a Tom. get Remember. will we big Things really

Thomas Hartnett

an long example. sells that well. a base very It's $XXX. [indiscernible] It's That's

James McCann

and continues gain $XXX that's that's but us strong strength, for to A ticket. strong, seller beautiful item, a and

So that of the question, I Linda. to think heart your goes

Linda Bolton-Weiser

than the Remembered PMall? Things would for higher for be margin contribution And

Thomas Hartnett

less with of about things some the is same. the bit a margin can remembered contribution items labor of make that The we component be automation. on higher The little

have about we're though there Things the Remember more wall less in ticket the There's So side. is the those Remember higher on But even working versa and a on -- personalization we things. brand, future. and Things the about product, vice personalization still and the it product through opportunity it's the

Linda Bolton-Weiser

don't lot Okay. you I about mean, you on reduction, front. curious historically. a And just that action workforce for then taking recall I of workforce I'm applaud just I But your reductions taking

affecting just wondering Maybe that sitting? morale on is within you the how I'm So comment Like that could that. company?

James McCann

yes, And always answer it's you're right. The there. tough stop do. I'll Jim. it's is to Linda,

done -- haven't we We historically, done that often. haven't

significant we've think memory I my time only this second had to a that is the risk. do in

us going you'll management. talent I not it's a think frankly, And have think we new what unique I us. of see forward to is that from sense

never a I much any and history or That have you're or which area think to ] there's there's opportunity talent people an regular they will how manage of that in or to now people not in initiated of [indiscernible] to like continue be areas of that you're think up the kind just be you're up a weeks, and their even going to growth and part sometimes require of large staffing a going cases, staff where is significant telling how to had is their had in as we've they company couple that our we've forward, in going to last where remove emphasizing seeing really going growth, to used layoffs company hires so some their some ranks the their management a as you layoffs you're move couple Google, and where when us. cost really company management about to [ areas folks.

size to we're growth opportunities the or from and the managing proactive So I other very exposure way sure talent we stepping that Work have aren't areas on point problems think same a have any have risks minimizing I a our attitude be the of about our of expenses growing we'd management. forward. don't ongoing our a we will But that make always, to and talent going do in different view, going anticipate forward. Smarter don't

Thomas Hartnett

and that's to to we've And several logistics, to and cost about operating driven down all talked more driving about and out management of more costs business. rise have technology down a efficient our the management. much broader negotiations, production where spending areas, moving our how some is continued now about just really incorporate talked marketing smarter, about per this automation marketing in drive lot We've efficiency, we've right? costs from digital is of Linda, labor our inventory spend. the funnel, the talked efficiently years than rates bottom It for then we're and package,

So drive area of business. at more it this operate continuing out the of to and cost ultimately can how is efficiently we look business a much broader

Operator

Lebiedzinski with comes Sidoti. from next Our question Anthony

Unknown Analyst

bundles? the And [indiscernible] is value for seeing was This Anthony. more multi-branded quarter? success are in How average order on much you doing with

James McCann

see to points, is with points. evidences of on rise when in have and say our There's heart tell to price we're weathering say Bill not And I'll our broader two, are a the a average we're that. And a do more I to -- supports piece price a customers, pieces a thrilled then see lower-income value order But efforts it. thrilled that. many you Number of the around that not you'll not is the that's income and causes than question, one. is you average accessible It will theory period reason question that better order order third touch couple see customers seen the your our because I'd better I'd palpitations. the -- with have us but better number what with increasing. we're average Bill this And have range short higher was. the bundles. of that thrilled

So with last-mile asked question benefiting our with and goes than success start seen one the we've Tom to capabilities, Bill about to seeing order Alex I is more talk that's of that back about value of which collection to our our brands. with what a delivery average bundles, how the a which we're earlier ask bundles then

William Shea

Yes.

quarter X.X% ultimately, bundles of It's pricing point, the lot these was is Jim's ticket driven about during $XX. average the that and that by year-over-year. So To have. a we up the elasticity

number our the price that's well and affluent buy a items less bundles consumer describe. more that orders also higher-priced So will we've interest continuing is feed have from introduced introducing to consumer. to lower the as items of point generate that we that But Tom been [indiscernible]

James McCann

Tom, do you want to...

Thomas Hartnett

Just AOV rose the we to I -- highlight I rose question. on don't your apologize. this we is -- again think specific was $XX so [indiscernible] to where [indiscernible] It's of part

and business exceeding between great. to discrete series continuing -- Mall bundle expectations. recently gift. David board this have example a cutting our bundles as give is we our our our Shakudari continue We're We you of do [ launched So Personalization that for together and personalized one Harry we're board to business a where ] the & new with delivered season, holiday our

William Shea

Board the on is name a it. personalized And family with

Thomas Hartnett

Is as personalized Board example. The

the bundling So we just like gifts. with great were talking Cheryl's have now Cookies, and with we about those bundles doing that with are floral

we different products assortment brands. others that the whole is a wine a talked of different with throughout we're Some of the gift bundling about

& great which this to is prepared wonderful Shari’s floral with be Harry is which just is arrangement. that's -- selling have a appeal, have Mother's for we're prime Day, David $XXX. in gift We a but [indiscernible], We for also bundling rib, Berries going think

that's think appeal our going a to greater of don't customers. some I for So affluent have

we continue of we the bundles into job and done to model, gravitating have up ideas consumers push a So great our great that our and with heavily coming being very are -- merchants towards. creative

So happy see. to

Operator

[Operator Instructions].

comes next Water question Our with Tower from Doug Lane Research.

Douglas Lane

XX%, really and XX%, loss everybody. Yes. too your quarter $X.X is was million, not too here. a of look were X far where of again, Good from pre-COVID. And far margin the that I months, not gross you morning, at couple EBITDA pre-COVID. that's through where I things from just quarter third have

to how regards I my cost with close the your on So question structure? reverting are you to guess mean is,

William Shea

Yes.

quarter XX-year XXXX that to low margin and of saw Doug, or climbing XXXX, in if you we've look at a been So points. you back. XX.X% if look a take XX% year, XX% that now this ago, at a a be guided basis XX progress year from years exceed perspective, in that the upped point on anticipate from after be give -- in XX% year, you few low great We history and will range, had kind and And of the hit that us the the margins this our XX.X%. we and At XXs, we've obviously we'd that. beginning the of we made for low year, second the

back, So going historical not think mean couple years. the for to we way there's over we're XX% the opportunity next that and we're still but there of all do climbing of to us convert back our And we're yet.

Douglas Lane

front strategy? the And the getting here, pretty close. Are acquisition you Anyway, you're I'm environment acquisitions prioritizing days? the these growth balance ask, at what's your and No, like? looking to have like what's look I still sheet in

James McCann

Jim. don't I Well, to profitability this hard is Doug, smaller a have or finding lot is of capital The have confinement short-term they companies earlier-stage really particularly say time a companies, a I'd overall that think, clear path if profitability.

we're being things give judicious what about consideration environment it's very So we real to. target-rich a

existing spending effort team revenue, don't comes We're talked acquisition. using improve just acquisition very that It look have. terms to as very we acquisition. in a very with even an we little acquisition of talented We as as with that that's We're but just -- products a We portfolio weeks announced fit technology capabilities that of at ago. a nicely acquisition. we of an our see few There about see our in our we really a team. So talent an a that lot capabilities. of

do to don't any acquisitions think we need I objectives. to So achieve our near-term

does acquisitions tuck-in something well, capabilities. do continue that really to them better of and experience We portfolio to we them more helping provide and and on really that a our will we'll full kind consumers, our these of for services. blend with find a fit our have be buttress providing opportunistic talent different if relationships

we're So very customers or color. Tom, database I Bill kind want think need how about serve those primary company to a have of our being our to an serve in any customers. is be, judicious can it's objective. And do a do enormous what capabilities that we really but already good We we what database environment we else

William Shea

the big seen over years David us I and Yes. I to & was with do going Mall. Personalization acquisitions you've Harry say, mean,

over to Smart the come points capabilities with like with to that hires customers and the Berries we have more and enhance interact bring and cards us does Card offering us acquisitions Things It our You've visit now company seen an us will gift for the almost us year and type can and tuck-in the that and offerings come do our of with the customers we kind at Remembered items. to Shari’s Card want seen price greeting that the low aqua so interact you've give or And with that consumers of our help that Isle Isle. with frequently. last are us at

Operator

question. was Ladies our and gentlemen, this last

William Shea

for with and one-on-one. Thanks Any your chat be happy for you your good have, all. you to you questions. follow-up thank we interest will Well, other

A will to We in that future. anytime or Day reminder, today, happy do Mother's push beginning the at of here. the the tomorrow we're

help mom-like you So a express gifts yourself life have beautiful all to moms around the and of will people brands your you. are or the women you to in right portfolio the influence selection the wonderful you on all very had way where our life in your of moms from who just in

So for upcoming your Mother's and interest enjoy today. Thanks Day holiday. the your time

Operator

conference and the Ladies presentation. gentlemen, concluded. this Thank has now to for you attending

You may disconnect. now

1-800-FLOWERS.COM (FLWS) 2 May 242024 Q3 Earnings call transcript