- Earnings call transcript Q3 2022

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Operator

Greetings. Welcome to the Build-A-Bear Workshop Third Quarter 2022 Earnings Call. At this time, all participants will be in listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. now conference I'll Malkin to time, ICR. of this turn over the Allison At Ms. now begin. may you Malkin,

Allison Malkin

Good you Todorovic, Sharon Price morning. today John, me Thank CEO; for joining and Voin CFO. With us. are

your in now, turn of results to any undertake could section differ annual Form those call statements. like forward-looking I recorded earnings will the on company's including call and one we factors, begin release call the number call For the forth obligation John. subject today's of uncertainties. quarter one both We XXXX question in call. financials questions. this after is would priorities. This to made is to due internet. and and those if available get be the performance, After, Members replay our the questions with today site. can webcast to set call the have detail, no of currently to the we today media conference our IR a risks and remind will our materially to free be our forward-looking revise I guidance that fiscal progress you with questions statements XX-K. will update on and you Factors questions. Sharon The should one-hour that the call our call, follow-up. are this of the over later limit contact from on the Please Relations way, portion and third report discussion Investor questions. Voin to to take then will via open note, the available further may Sharon of key ask will broadcast during more everyone review to us in we Risk And your have being the re-queue anticipated everyone's website. who We Feel on on corporate A your live inherently Actual

Sharon John

Good us for thank today. morning, you and joining

results with We our continue our from are to see pleased third business months and consumers. brand in and momentum with strong interest first as we nine quarter consistency

Our XXXX throughout With we double-digit delivered of leading quarter in that increases, have to fiscal period seven geographies. compared profitability our transactions year's growth increased traffic store time. across third consecutive to retail now to revenues continues with total the prior show sustained quarters year-over-year

We has record multiple fourth affinity that our positions XXXX that on in our us year-to-date interaction year building to We consistent and trends addressable the of positioned awareness scale deliver and strategic history channels and foundation of as marks our leverage with strategy quarter execution are to transactions results, been this brand broader growth more Given built retail further the the positive the leveraging diversification reflects disciplined profitable to fuel growth. drive believe successful track model transformation most and and believe consumer XX-year brand market. this our previous high. through has a the been drive which we our long-term profitable of and instituted,

of third $XXX.X with fiscal We million. over with of of growth an revenues net total the million nearly all saw includes, quarter the of reported across XX% of sales, increases $X.X quarter, impact highlights unfavorable over XXXX exchange foreign no period solid Specifically segments retail on in increase increase sheet, of quarter. a a even solid have with income we continue XXXX the franchising. ending international Pre-tax And and close position $XX and fiscal over to XX% revenue revolving third credit borrowings facility. compared our the to strong commercial million, an financial balance to

of return and our initiatives, growth to have to digital made and in the which to and experience transformation, our more our omnichannel financial a intended on specifics and while in accelerating comprehensive evolve invest expanded Now drive to taking continuing capability initiatives broad retail value let me leveraging includes our we position shareholders. advantage solid strategic review progress reaching footprint

First, and want? they consumer organization want? and Today's multiple and to these that elevates our are want model. want. transformation consumers And Where engagements channels dynamic connection, shopping Optimizing we confident emotional to that our brands benefits consumer the diverse for and is needs. they this throughout they the their and segments engage with whatever business omni-channel requires that marketing company intelligent of provide of digital offerings our experiences when providing services

continue As develop both in demand. our expand, revenue channels and value, such, regard of believe in engaging as refine each capabilities. provides driving in profitable consumer to to that technology we multiple and that in In balance deliver digital these invest profitable We total person growth. generally adjust the in are to with post-pandemic any a single on shopping visits value and driving agnostic the between era, and servicing more consistently we digital to focus to lifetime continues channel shopping

in update first being and quarter, landing planned prepared checkout. to with the the the Specifically, site for testing the refinement, AB of our e-commerce algorithm to strategy, demand throughout and page on the new period from of as we points launched our it extended relates made global version digital multiple

back demand quarter have the said, sales sales most to periods some Cyber in have our and and disruption shifting could from also some trend a be to than in the to quarter. location, in our Monday shopping, related to what a the year. That our our trend decline Friday total positive to greater growth growth of compared given returned current While upgrade, to as planned strength simply in expected saw in is prior e-commerce we the type be the Black quarter, trends this during recent person of consumer retail shown of both a macro seems improvement digital which demand being fourth with the

to offerings of new new family ranging features shipping purchases, key The and incremental an advanced and we than barricades shop, our of intended technology analytics our delivery merchandise to active exclusive on personalized per member trend, member with of had omnichannel which our past. giving specific automated journey average was for communication products, initiatives the quarter, enrollment ahead In to have from taken consumer from the of access this also saw direct higher holidays a and sooner our evolved objectives brand providing as marketing pattern we transactions. enrollment value. and more and In gift target the based spend refine increase, as enthusiasts, further we discounted products repeat program heart members key in we purchase our e-commerce as the average to and preferences. number to in have Increased program by member early to in new and patterns, to with web did annual consumer conjunction increase designed collectibles core advancements reward our average pajama redesign to well year. with buyer lifetime one use consumers occasions addition with have in of the loyal predictive the and other the place than efforts, web and these products and historical and with as prior In base, offerings. we new messages features both at continued the advantage marketing such prior in attribute with member active per greater drive to benefits drive compared engage updates platform, we seasonal multi-generational further supporting effectively our the shopping launching loyalty transactions We box, revenue or

XX% September in in launched increase holiday the category early third and saw to Halloween compared year assortment for for our quarter, of product. prior record For contributing for Halloween over to in period, an sales a the we the our strong demand example, this in

production as digital and from are entertaining and and the sites TikTok NFT programming live Glisten of Regarding short next announced action film posts, like streaming recently with The year. commemorating brand ongoing more best-selling series. platforms. with best-selling partnership we successful our to iHeartRADIO to Honey affinity in Netflix, launching our Build-A-Bear award-winning called YouTube based From continues and Facebook to and the XXXX Radio metaverse form first the in press on in partnership for that and our our for later Santa's driving with followed Build-A-Bear social content been of details Mission a Sunshine, like our line awareness entered Reindeer historically Witherspoon's Hello for include pipeline. have multiple platforms the film on created content with These slated Morden may business. know, Anniversary product viral by the Separately, Build-A-Bear company, Reese as a Merry holiday product Girls as an release platform, WebX Taylor an strategy, with launch other via content characters quickly Instagram our animated media documentary featuring unique off and of our NFT you we the multiyear on media line, developing shared various development today. XXth based documentarian be is the projects to popularity Build-A-Bear Further projects recently suite which well to air by slated

While to the we most deep in adult this on of platform. video Build-A-Bear collector also world's developing popular enthusiast to are plans engagement way, and we continue game process in have exciting of one generate new a our the with

high decade to sharing the gaming well our MNO DS mind, to forward through endeavor get consumer had more core we into as of looking very While and designed day. And ages. from information this participation launch all we fans in with platforms younger first a Build-A-Bear's over ago are closer

to which digitally to capabilities. take to share of the our have footprint while Turning pillar, continue I'd our and our experience second that is company. retail to like evolve we expanded advantage evolved and omnichannel

been Our of focused of which an diversified to centric integration physical drive experiences business value. model, component brand our a remain has important stores on building consumer long

space, and digital that relationships multiple our long and and which Although evolve our have had mortar worked retail the emotional and especially physical is our in killer optionality recognized to and connection while shopping, workshops our history profitability of during to growth channels. pandemic for footprint. of expanded meaningful further may the leveraging foundation, the the began simultaneously lease capitalize trend our opportunity multigenerational our speak, the we profitable online in high-level on diligently omnichannel XX-year that drive we believed to one-to-one so stores, brick had expertise in and and positions Build-A-Bear at e-commerce to us significant across app, Recall

expertise cash to and clear multi-dimensional flow. and created for of average from our years over business, tenacity, the significant providing we the Given with both XXX% essentially delivering contribution retail brand captures club XX% wall profitable, our engine free strategic ranging loyalty intent exceptional have leverage a being of with locations

we quarter, see in grow of we X% the consumers in they continue as with saw extends an value Its scale diversified in over increase the sail, person Now sales to opportunity growth compared in an Again, and this embracing online this to shopping, manner. than a both and year. to of prior sales quarters store deliver. beyond more profitable digital stores revenue decline net in the the retail In offset demand.

stores, digital fulfill leveraging also labor demand We inventory. and on-site from our

touchpoints, as and site-based stores threshold consumers our XX the act entertainment, reminder, immersive a As of building brand over cross the engaging locations marketing each million vehicle, that brand year.

serve our the We foundation engagement that a connection. often stores have an emotional for lays the brand, lifetime and of initial is

third-party Build-A-Bear shared, Hall more of XXXX. Pro Six we such Mountain, Through expand profitably portfolio, the Magic models Football Flags and locations our potential settings, combination store, see in of a to XX including diverse corporate Fame. previously in than our fiscal As the and retail business opening adventure

corporate compared We the to third-party end year expect XXX of the combined approximately and finish at XXX with XXXX. to locations

our He increase a $X model revenues quarter the basis The capitalized, in to over are million the in year reflects and strong in profitability financial belief not expected across respectively. brand are our settings revenue entire North XX million year-to-date, to dollars centric in third-party the an approximately and And be engage footprint understated. and note growth end sustained our It as regarding generating pillar, year, of position supports family with the allowing retail with locations, commercial multidimensional to over the this to at wholesale retail profit for the shareholders. opportunity over tend that minimal in leveraging core while retail us XX% of stored overhead. $XX is the we to portfolio is efficiently a XX% that approach important margins to and our remain value and as be on beyond. XXXX our by third finally, and essentially third are retail our further intent This on drove we invest returning consumers solid America growth prior to our

us increased critical as remain most positive, to fiscal have I we because our guidance, the profitable As trends our track of business noted we to has in year look fourth annual quarter history. the which XXXX, deliver on

believe products compared was stronger branded impacted in properties we continue with depth such We chain as well proven inventory that Mission, to updated licensed Merry are as a position to supply in by XXXX, which disruptions. as sufficient

quarter store outpacing the patterns positive, inclusive traffic a trends basis, on to shopping Friday Our of have Black reported remained period. national date

higher We also expect and levels capability. our continue advanced retention our trend marketing and guest with of of digital to acquisition loyalty

segment broad enthusiastic puts We across of around our collection. look seen fans kids channels. honoring with globe, funds Thanks little founder to the the everyone are help in our of selection growth that add with forward our and have sponsors million the the in furry movie, that we've that need. more culminated In products at I for to the to Anniversary tied a of Exchange And a the licensing launch achieved. Ted heart Stock Gala, this and event life. sharing positive partners side adult want and our a response thank seasonal the from that special ringing to some to Build-A-Bear that the the to upcoming The have since joined associates products our XXth teen New XXX that to on bell Foundation’s at October, to new events stories In the celebration we the the heart celebrated suppliers, friends our success official to of with brand the closing, Lasso mission of and been York all for almost raise range opening of made company's in inception. and we Anniversary

history, Why? again Because most While this change century once the past profitable has Build-A-Bear real we all to is about is company be a actually our year, our story executed face moment during and recognized have enjoyed future. the is this that the quarter shifting consumer celebrating that expected in a entertainment preferences, consumer year a company, in in digital engagement, evolving featuring global than geopolitical growing of impacts time in multi-channel that diversified any more sweeping and appeal digital profitable site-based become and existence. categories products in to our broader advancement XX base pandemic experienced to and at a our

to wherewithal the business concerns, further model determined and take our to to next our continue drive Although we we some of have and journey predictions excited, we emotional we long-term power the of our tremendous steps this business the continued economic the team associated with our are there brands. Therefore, Build-A-Bear. relevance to the believe of of of shareholder remain value proven and connection leverage resilience model, the as motivated monetize on value

to to Now over Voin. I'd like the turn call

Voin Todorovic

Thanks, morning, everyone. Sharon, and good

performance. to speak details share to today strong another pleased are We you and quarterly regarding

fiscal XX% is XX% high. profitability compared growth in income, to noted, As is in this the revenues for prior year over noted of record Xth increased consecutive increase our of marks quarter generated pre-tax revenue Xrd total and quarter. which third the with historical also prior the consecutive year Nearly

We improved revenue increased our has have believe demonstrates or that third perspective, To in broadened strategy, $XX to we embraced an execution quarter nearly delivering resulting increase the and into brand. put disciplined profitability, and Build-A-Bear XX% in us grew shown average purchase comparing quarter, current our our of fiscal in million base $XX the annual revenue XXXX consistency power frequency of which consumer a across million. over profitability long-term

first and as the our sales increase business in pressures confidence levels headwinds our we compared in The see Monday in for year. driving even for and guidance last effective nine marketing Black our experiences and continue. proprietary and including successful and been retail trends retail same results all our the the overall products which ranges us nine quarter, contributed efficiently and with first annual year double-digit gives ongoing revenue of fourth the results combined Cyber to period positive Friday traffic months months to increases, successful increased Thus profitability momentum, inflationary coupled growth to the have to traffic, far performance. unique of combination current and strong Our currency have have with continued

third results. X.X% compared to $XX.X quarter. increase on to revenues million XXXX the quarter in reviewed and were our Total Moving $XXX.X third fiscal million

negatively demand currency $X.X strength than retail impacted store by shopping decline online. from consumers rates person third revenue the digital between sales, exchange behavior offsetting Foreign more quarter. in million in a fiscal The adjust increased retail X.X% XXXX as with in the revenue and in quarter

driving Combined growth, and quarter. third external commercial Our expected. to healthy in the XXXX pressure from traffic increases. international key quarter over inflationary grew transaction XX%, are strength strategic metrics and from sequentially retail primarily versus increasing in XX%, margin from our is segments was continued franchise show is we second Gross revenue profit compared price freight as

in in profit quarter expense, and XXXX. distribution We successful been expanding to quarter management well margin driven of and X,XXX by as year's in points. third basis significant reflects expense basis mostly have role limited gross to margin merchandise profit played We points costs. compared as reduction margin last XXX of in for a believe offset a QX in gross macro protocols, XX and by proactive leverage gross versus reduction approximately of 'XX Overall, by high the profit which freight in third the margin, these trade points, minimizing occupancy our mitigating inflation impact discipline costs, higher that basis

third the revenues 'XX. percent were quarter of year. $X.X first XXX XX.X%, versus months turning a with final improvements when which income nine fiscal point fiscal to of considering margin costs we the first the in stock growth compared income year. exchange. incurred nine increase increase XXXX. to had million, XXXX. of XXX,XXX to million the even of the of the million total pre-tax million, of showed prior profit of SG&A compared prior is we to to $XX.X and million, the was incremental of year, of $X.X continue exchange. months shares compared $XX.X XX.X% an This contribute We in basis expect year-to-date, was impressive of unfavorable And Total expansion the XXXX approximately growth freight representing third and results million, $XX.X incremental particularly first impact as gross the nine year, and fiscal $XXX.X million unfavorable revenues to XX.X pre-tax outstanding to compared last of that an quarter with currency common freight costs million delivered $X in from in currency million, We for shares end, our of at of our over expenses approximately $XX freight quarter XX.X At million quarter months, the had improve end

$XX.X approximately the During shares and for about on our million approximately repurchase quarter, have remaining authorization million $XX million program. we share $X.X repurchase XXX,XXX

mitigate with drive million, position million The the mind, quarter. sales strategic at inventory of last we offerings, balance our of last to Keep the the cash XXXX ended with the XXXX repurchase holiday momentum. a facilities. borrowings dividends at had our QX from no supply Turning placement, challenges. strategic our core $XX.X of increase to also inventory, inventory prior The the the part of increase revolving as in chain compounded giving quarter compared end under to the and credit performance collections in fiscal chain to the products capital of year. year's order to evergreen equivalents stock and in the the us million reduce an the of investment had timing $XX.X the by a sheet, quarter last third third cash fiscal end, the compared merchandise ended third $XX of of low end year in reflects ongoing reflects cash supply working business due we support acceleration to forward quarter intended year end the year-over-year our of unusually common increased quantities our efforts higher third for the of port support to period strong received. disruptions, to million And special and in quarter. impact payment of growth, At quarter inclusive We further in main initiatives $XX.X

unit high to In to to composition levels, at inventory remain expect balance inventory inventory, costs. XXXX. be the with both transportation and plan our addition and the We end our year continue reflects of the below and higher comfortable fiscal product level

currency nine mindful the our including we year first positive While on are based exchange guidance trend well previous increasing current as our full to overall environment, of our macro anticipated compared performance favorable and as continued months strong our outlook. rate,

XXXX million, in million For million, total to range fiscal $XXX.X as of chain, XX%, expenditures $XX and expect fiscal keep in to range range in of $XX the the XXXX, and timely fiscal exchange XX% basis, $XX $XX or ship range of the in assumes operations to to fully depreciation amortization the rate we million. material approximately and of total pre-tax to EBITDA $XX macroeconomic million fiscal our of foreign million, compared our the million. as to income the of revenues on compared further $XXX range as of of relevant in of $XX receive outlook the in the million. to revenues Pre-tax no a currently mind in products million $XXX including revenue rate. XXXX $XX range to tax inflationary XX pressures, in of million capital million of $XX.X supply compared that Please Income to EBITDA XXXX million. the ability changes income currency environment, approximate

sustain to performance. of come I'm the celebratory to of cause and positive year, accomplishments XXth hard proud that has the our our we work of team As led

Over and months, momentum double-digit business. profitability, continued growth, revenue evolution, driven in our have we diversification, the past nine

operator turn Operator? and our over in position look We a have future. deliver entered further forward of to success questions. This will concludes call the now continuing the we holiday the to season from to remarks. for the prepared back strength And

Operator

line with And first the question Eric Beder our Research. comes you. SCC Thank from of Instructions]. [Operator

Eric Beder

online or in integrated see that the new you how you going rollout that what it with terms QX going website about gets could you think don't the you other mentioned saw of do see of that, you I as You forward? online. talked the and more pieces in forward

Sharon John

as it's Yes. as options also number mobile first of not and well with I It's lot optimizing that putting lot test capabilities sales, well taking of objective opportunity, new just click add-on in as as and conversion, for a improving a sales online, the mentioned, of a best-in-class to through as things.

If time, that you been encourage you into we're guys salesforce, to thank relationship important you go experience specific on to at and is same working bases expanding integrating well time, specific we it, the analytics consumers. the are know for doing for and approach question, it's our allowing dynamic that to site you as what have of the many associated accumulate with some quite and as and with them us integrated with this which that also have comprehensive consumer

that retail engagement, assumptions related and all out is which on get an purchase, based look-a-alike build different When specific their perhaps to additional opportunity and previous channels. expansion history on omnichannel process. of which the automatic is is robust have allows another to add-on some preference, saw being And this to other or to that drive lifetime the analytics selling, value you an inclusive the the terminology journeys, suggested that across an data and purchase there more numerous based us making significant profitable to So the for of sales consumer's a engage we a arm, the combined today, e-commerce, able is the growth world is in way multiple post-COVID in which environment. in based this global this with capabilities, ways on

end at low was to XXXX it As of mid prior that, the our XX% of business you When know, that single-digit. sales. the in was to

back We that's that from. going and usually the highest your value and and exchange interface have where consumer comes and forth seen consumers

then the be watch the goal into ultimate raise go go or the to website, out level provide occasions that's to store, that able movie engagement, for to them or is on even to then opportunities, cycle was and them of consumers little I'm push products, them. this a that's to sorry, into So bit to encourage a reach crux the And comprehensive but back to evolve question. them to a and engaged to certain that's value. of stay with long, content the to wanting that getting of it's lifetime a, Build-A-Bear

comprehensive a it So answer. I thought deserved

Eric Beder

I follow-up. just a

you you've And out you I this How kind product the year, So you family out do the think of know as see matching that a license ties do rolled offerings expansion? expanded pet of it this a I pajamas? stores. other kind what expanding either you store? just best or or to talked you about the the where terms And of experience? in for should do be what How they the able determine are them items at licensee customer? for the online get the with

Sharon John

also where how pajamas. both how We a of with The and acceptance in pajama The with category. is consumer of our teddy our lot brand, multi-dimensional valid teddy holidays sense stretchable We're the The a category that's sorts of Build-A-Bear, associated bedtime. appropriate. a these think answers often are certain And with is we're be to that. When wildly activities. moments we're holiday associated terms associated might determining And makes what brand are family matching about is into special woven for a bears celebratory family holiday category, experience. and are and bedtime. bears trending categories

directly own how of of concept see box, that with our the program just heart make can that can our speaking consumers, to marketing tens that the kind we family to box materials of reasons to sense, marketing the that gift database, before our we which would And millions might that to website, pajamas we're we've even our mentioned be do on to sending be use of consumer beyond piece that's through we consumer, that particular allows that like That and pajamas reason, have, holiday reach other us information a why to decided category these them. we add is the direct you would well. So one on we loyalty know relevant.

loyalty our through program, We has a who have sense a family. also

out able that. we're those journey associated dots that's push to with and connect So a

few that's that And toys the business products cut licensing which and the case, core this competency is now we've and I last done those market that toys with of in with stitch source past, right? reports would Understand store, believe molded our that outbound So understand, licensing full the how molded a the pet the everyone's itself outside that sort that a them we've exclusively been hard heard, lot expertise smart. pretty and years we're first in are, ideal and was that's business bikes. and through of not There's we it. venue the example. manufacturing and in best. venue for were particular category. with November, are we've fleet believe about the excited been that things done or that with I've outbound I pet it of And we, pet we our which for through to of a manage a we our, of from either where In be week the We've

Operator

is question William line Zolezzi Our from of the next with Divisadero.

William Zolezzi

guys in freight peers, domestically start. with QX to your questions both on rates, and housekeeping a you just are really title lot speaking couple, And accounting. obviously, of internationally collapsed and A

of the big QX a benefit here. it periods, year, be none next kind be yet would in namely, subsequent So and, of there'll freight,

gross expanded within margins QX. Your

to And could we moved through given did of rates kind we have margins such you the improvement seen the turn in guys the So in see freight down I actually of a QX? benefits the or as next that big see further gross year. guess, improvement, we page why period, totality

Voin Todorovic

as some Freight in year. of of are in there And further call, said right. seasonality, of QX moved in as on that those last first in gets sold, are the of there bigger QX. half timing of QX you William inventory improvement and we rates see and improvement we expected was are impact yes, expensing that call, as timing and we we we reducing the more last the some even saw the to and said, is So that, we versus as rates

in about out called of sales as those additional are part impacts points But managing quarters were points. thinking. we that's all our couple basically quarter and XXX line activity, occupancy the basis with promotional and distribution our that first able basis of with well we costs. offset was this mitigate So and leverage to freight as you in was XXX And, of about of increase reason, costs, what and

Now, to of as continue QX, contribute in profit to final as in freight the margin my improve we go to forward costs the we gross and said quarter this we remarks, in expansion year. expect

William Zolezzi

thing, working. picture kind of think lot my but of we serving yet just guys And gosh, kind I is like working then as grow and about are your or going just the children. space, of bigger of and toy I one you peer’s this year, guys which of environment quarters tough. We're horrible to kind question Funko, Hasbro And some it industry an the the look seems revenue, here. are very a double-digit that not it's on are landscape you oh, guess that and across Mattel,

think your you've you do why resilient been so have peers not? when So

Sharon John

That's us a different certainly that think children's company, speak to as other insight it. think to which defined mentioned, companies you but were just about I a to maybe toy can't the way an

you core toy. are years extend brand a to where beyond worked the collector as might an ago. We XX the to very And a and also We're XX% and adults. started what have last of a company, have our brand. enthusiast mentioned gifting in extended response, brand, hard we we've we consider now as kids sales beyond teens

First call different our we friends serve occasions. of them, different bear to all, the purposes as furry and teddy for like

we or with expanded its initiatives as call serves? own the the entirely it business a categories, extension it or are through that with Toys Is would the partnership, a the business? Is it's that that, Is have what business. whether helping it definition, guess? that's into but that's purposes purposes. through mentioned serves different the toy, So, it you with side it And fundamental it's to piece we it entertainment Pajama our a second most drive new Pet yes, the is

the that, is business diversification of very believe we strong. our So

discussion piece the The is retail. other that which comments, served our is tired we in about up

we efficient to that fulfillment capability, That's wholesale that warehouses with an companies have XXX that to manner, improve ability part. the those elevate that connect can't, with and machine a a important omnichannel consumer distribution be drives really is successfully to engagement odd in digitally stores many We have directly helps of the way mile in call that vertical last I often why retail killer our drives that some a using integrated now profitability, us locations that and app.

to the so points, multiple seen to created to really we is not we goes we times watching in our and out. their our are posting then next mentioned that own, is a being and to an approach that, again that involved emotionally their there with level. not to for of implies North UGC, And more really that type and This the that's that multiple that teens because at retail no that of other Pokemon. with countries, stored woven that, of of engagement lives. position pajamas, whether into to buy increases movie We with These connected particularly are consumers approach not but touch have important going water these that, retail, online all we only is different Netflix, content further generated we believe level brand, viral on in have build and that across gifting, expansion have that user America on stores. have raise calls significant go I'm we other have online multiple our us something data we fabric piece now a the are that in just; the in this to to over now integrated in we initiatives And allows certainly fact a opportunity really integrated engages the are

We an engagements impressions media of we lines stores. form in kinds when can our are drop, the iconic on that we our that up we -- the brand and the it you showing outside get have, of that see business

peers different may different. business really our you call them And although model. think I think I So in a some way, that's we are

William Zolezzi

what guys in are job we this to applies down. it's about of the of macro guys this It an average great down share would and as And performing comment, you different share about like stock and have clearly, year, that. have is we certainly done argument your that counts who do. look resilient to the with you a kind be level. guess made guidance XX% what much the end looks pretty you guys of was that's next year, a for year. the I'll But end earnings are back obviously, buying year, $X.XX proven gone think you count there I which have high a the count to And And forward year. the So I taken share the just at through knows

at the in earnings have are built from some we So in the mind year, as just next never growth, we you lower freight. the on that share guys working look initiatives count,

of as to macro And higher kind away So the look XX have next environment, the at fair a year. continue this I would a year. just you number year the buyback be with in with this a earnings pick guys doing I around resilient much proven take at can guys in done bucks. to encourage guess we've you count path this hard stock and we're right And XXX we to

up I'm this a and job great thanks doing So year. there for

Operator

line [Operator Kanen with next Kanen Wealth Instructions] Management. Our question is the of David from

David Kanen

transportation that actually non-labor was on caller way. costs my and question inflation, seemingly previous going The posed list inflation, the about your

there off. talk a checked in volume bit revenue, But increase? and margin. to in the improvement little could is price? the How already much you price potentially more quarter versus And that's of that take about room if So is

Voin Todorovic

And managed activity about the had as well did us, revenue, occupancy costs. in freight the very have the strategically transactions that of seen But to increasing within see of negative increase impact year costs, and an compared been incremental as that we promotional our quarter, remarks, of We we has my to able XXX manage offsetting Yes, we increasing as we pressures. seen leveraged in point promotions, were also know, distribution geographies. mentioned, impact as offset we our I definitely you basis growth prices, last we've some in we across inflationary low. our all

retail our in are store. we driving So average unit

record saw remarks, XX% really like are all it's customers year-over-year. of things stores. we products that her of business, place that performance and And the the also, saw, we as had putting So Sharon on strong resonating a mentioned the healthy Halloween quarter, key we selling in the product are strategies some signs we are improvement like working in in our like to and and and

to offsetting some helped been we some be managed drivers we revenue, resulted improvement expecting our are we going that QX. that those but also and expenses had So mostly that the top-line this our from are of And to in see we drive additional expected, that has to said continue trade and improve cost. is in

Sharon John

that second sort any by pricing opportunity always where we could the a volume not for strategic at the part offset places of to looking David. to that strategy, of our that important to be perspective. decline, it's price from And for basic our in addressable point perspective there be a We're they keep looking that accept, or careful an pricing always of is engaged question, would entry part increase think, would the broad level. And consumer price, very the a from Build-A-Bear. as know, we're that And keep elasticity to just base you strategy acceptable

David Kanen

previous center. just were you stock Okay. $XX, agree do of and include by the earnings value I the would that It probably XX be add the comment. comment, And that way, the you if distribution XX being I times cash, quick with callers our

job market think recognize continuing done. grow of like you've the earnings great that it I to the So has shares. still not is through And another buyback seems way really the

normal seen to quick flatten double-digit you is far a follow-up running starting rate know a I back returning in decline or to What it COVID at thus sort stores. have going the it out is are on Just e-com, year-over-year? -- quarter? are e-com. the decline people post of things still In to

Sharon John

Friday a As remarks we Monday. Cyber the the it's up and noted quarter, has, Black in currently strong we it in and had

Operator

turn now John session. the we've I'll of the closing question-and-answer end At this Thank over our call remarks. to for reached time, Sharon you.

Sharon John

look for to at speaking everyone happy forward with us to and joining seeing season We you conferences. wish you and you upcoming holiday investor Thanks healthy and our today. a

Operator

today's conclude will This conference.

we and lines You you your this for thank may participation. disconnect your time

Build-A-Bear Workshop (BBW) 30 Nov 222022 Q3 Earnings call transcript