The RealReal, Inc. (REAL) 9 Nov 202020 Q3 Earnings call transcript

Company Profile

Participants

Paul Bieber	Head, Investor Relations
Julie Wainwright	Founder & Chief Executive Officer
Matt Gustke	Chief Financial Officer
Justin Post	Bank of America
Oliver Chen	Cowen
Michael Binetti	Credit Suisse
Eric Sheridan	UBS
Ike Boruchow	Wells Fargo
Edward Yruma	KeyBanc Capital Markets
Aaron Kessler	Raymond James
Rick Patel	Needham & Company
Alec Legg	B. Riley
Simeon Siegel	BMO Capital Markets

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the RealReal Third Quarter 2020 Earnings Results Conference Call. At this time, all participants are in listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to turn the call over to Paul Bieber. Sir, you may begin.

Paul Bieber

Corey. you, Thank welcome quarter and RealReal's call earnings Good September to XX, the ended XXXX. for afternoon the I'm Paul Bieber, Head of Investor Relations at the RealReal.

to and which on website. Matt that we today CEO, are our press a available me discuss earlier stockholder are read results Joining letter and Founder chance Julie to Wainwright; Relations Hopefully, today, Chief our Gustke. Officer, distributed Investor release Financial you’ve had our and both of

forward-looking statements we known we making Before uncertainties, I’d will call. results this remind like and actual differ could and involve the that you during These begin, to risks, and statements of our materially. course be forward-looking unknown

periodic more on from factors about our earlier in in affect XX-Q report can risks, uncertainties XX-K, recent and release results information subsequent quarterly on that find Form our Form reports could today. and other earnings operating You most these our

GAAP have and press which In to call go the addition, measures, hand remarks, I’ll Julie financial our over comparable Q&A. to straight for we’ll in non-GAAP the presentation to include for reconciliations provided With certain that, measures introductory our then we will most Julie? release. earnings

Julie Wainwright

started footprint and and to in offices, for GMV launch hiring our welcome Chicago. and expanding we our were glove QX Improving markets stores an request and TRR luxury in in and growth improving City the supply white led Consequently, update the of earnings to quarter sales, call on cusp provided July, our we of growth. of our everyone. marketing, retail into growth. York contributed seeing overall trends increase reopened has in known retail When August, of recovery. we GMV by as signs and New to with consignment returned our last reinvesting encouraging LA LCOs our In Paul supply Thanks, the our influx service GMV and in was our

making comfortable in current future a these work growth. and feel COVID are environment and how safely to investments learning We for

underscores we're fundamentals. XX% In show GMV our improving results. in QX fact, The to beginning quarter-over-quarter improvement

And in our down so gives over optimism year-over-year year-on-year to down and happen supply This QX, that amplifies recovery supply recovery QX. LCO with and of in compared XX% and positive XX% QX GMV year-on-year in us retail XX% overall retail in a growth the far increased year-on-year return balance QX. October, could

a to are laser-focused and we remains, us and strategic us making we'd dedication, position our Once set employees company agile I'll sustainable all like over uncertainty with changes going forward that, it for And their to of will to forward. up company While again, COVID investments growth operational during stronger on to emerge for unprecedented turn questions. thank that continuing move more these from to the long-term times.

Operator

of America. first Justin line from Your your is Instructions] open. the Sir, with comes of Bank question line [Operator Post

Justin Post

do of that were I some your Great. you feel And will marketing you And forward? do for and the months, look do How savings that get $X When you Thank you go on that? think the curve spend think a And you quarter. spend? out virtual with next as side, vaccine I think nine have acquisition? for move a different supply the And get XX as couple could picked guess, of new second, experience you to it you marketing really in could now you. then news. be questions what could see efficient the that up million more buyers about we easier more efficiency think Obviously, year? lot months really you here. people

Julie Wainwright

it over Matt. I'll to start and turn then I'll

pretty is know -- like, pretty but early And indication look we phases have that in we here's you virtual we're the post-COVID, using don't good that it's as tactic. a a to to what what really So going of stay. here

work efficiencies, our So for also. great to really but gemologists good to LMs our hard way watch and predict gemologists, a for to some experts work and it's our it's of our

that mix the to are be we our in the forward. with City, small LCOs, in really we've the in off influx to Since to and seeing, the footprint luxury SKUs in going in XXX in took feet offices front X,XXX are record about max people the in a going product, concept we're mix. similar and going X,XXX definitely store, Stores noted in back. store again our Madison test product comfortable We're week and will test then So the one very October, to should reopened starting that's next as in three the York XXX XXX with days, We're going consignment -- our that store mini Palo also to New be square them number. have LCO one of next a dropping too, to the Alto. be opening XXX we running to

come part of mix Madison quickly. a neighborhood store will footprint a consignment luxury believe be has we the office that So really back store, a because neighborhood small as with

that vendor going and or greater maybe even go year and have of going to next we're some a we're We've a strategically product mix believe be is mix lines. We to already XX at percentage. change of also believe seeing to quality for to to better always used now. products offset our We part more least certain after the vendor vendor important months,

prominent of GMV, percent be be a part it vendor XX%. may So the of XX% it be huge a as high as business will but maybe our won't more

as art. been products for handbags and mix fine we jewelry, while along with businesses too home to us, down in really men's and well have done apparel noted and other have footwear So will see continue -- see shifts

and of those again. people and all as So normalize, more we expect things into go offices to get about out

really putting Look, over money So acquisition are our at wasn't time down cost into but growing great to back because demand on marketplace the I'm one just not turn is expect Matt. of we marketing we're our doing driving future healthy the all then to start what to pull to we but the make comment now consignors. generating and of and going numbers. again categories really about efficiency it

So to marketing and it return for flywheel But we It declining our efficiency a number makes time. where to our turn because buyers. that to then we become effect I'll prior while number what nice over sense become was do have a amazing just with to it it expect consignors Matt and color. COVID, an more still over consignors buyers our isn't

Matt Gutske

Julie. the Justin. Yes. for Thanks. Thanks, Thanks question,

of focused it's ways to couple of very a term. think little efficiency. I there's And the a -- So short danger bit about think getting too on marketing in

which go in for quarter close our and where investment period chart, you off would back as in like some there's we've marketing at So right? early so efficiency to marketing May, to as correlation as second the And been was the that we if saw sort progressively between zero of ever of example, recovery the efficiency. reinvest. early spend began naturally and as signs was point We

first for continued consignor. come It's going become it's to And they we see of the become to then buyer people both make. become have either to to a they take to members buyers path most as a us to supply feeling the typical and continued we're and retail as as or turning progressively we starting into for time, they that right GMV. with reinvest back, decision So signs recently in recovery

we're today today month, that helping going the next us So for help quarter to beyond. investments making us they're are but and next

up a are strong we come up for trajectory out set and So ourselves year strong in laser-focused ourselves setting world. a on to of the post-COVID

Justin Post

Okay. Thanks, in I’ll the back Thanks, Julie. Appreciate Matt. it. get queue.

Matt Gutske

Okay.

Julie Wainwright

you. Thank

Operator

of the open. from Sir, from Your line your line next Cowen. Oliver comes question Chen is

Oliver Chen

Hi, Julie Thanks. Matt. and

between the York which like unit improved us regions look costs is help York how less than negative. manifesting LA, and New an in faster you've any you inbound or markets LA supply but differences Regarding them? Also understand, opportunity those ahead, in seen New are the it's like improvement Could for operation automation. looks similarities and

forward you as we seeing well? would that that you're as ahead what So for highlight to generally look efficiencies

Julie Wainwright

it's over and Hey, Oliver, your I'll hear start again, turn it to to voice Matt. nice

back. are schools the York, New

schools open to and came area. blunt, into just the the faster be So people urban are back

So quickly. LCOs stores vibrant. -- then reopened and we became when opened busy and The -- we SoHo our got Madison. The

So like New well of it as as this as year, seems not faster. still year, it last beginning year, last it phenomenally did performing York, is while coming back

prime just are So It's New think people area. the is York reason. and engaged in that's York what we back and New

that there we August. started just I if So theory shutting shows tell up that mean every And coming Matt started ticking people you another Hamptons down know, back. have because isn't our start -- when number business in other -- when can I don't you

Matt Gutske

consignment extra is that other Yes. office to have the an York. extra basic The New to I've and seen only store an thing same we do in thing. add

more have there. we a retail bit presence So of a little

tail into encouraged very and So but very of that October. the certainly trends recognize go the both by the end to to markets in long the contributed where a quarter there's But still were. we way obviously at we're certainly

Julie Wainwright

then... And

Matt Gutske

The second question...

Julie Wainwright

Yes.

Second question.

Matt Gutske

on efficiencies. Yes automation inbound

of COVID. fixed. by we in quarter. the little So, the increasing further big our system there's stated from gains amount come XX% got of driving so are tremendous the people to there's amount go more a to helps the the by from a leverage going basically that more. We because of nicely through us during costs end that the some of the there about we've think leverage even that of us that to supply certain We are room into very have comes that and not we're third projects are bit progressing much lot a aspects that automation steady a goal But three of talked incremental for repeatedly automate are automation. volume It's that

going is to have than we're to growth to recently. even when back benefit getting we more really see So, start

Oliver Chen

QX with a Would dynamic? does average how on up. Okay. units and/or being supply down witnessing the orders you mix? you're Like X% And account, expect the order that interplay and the finally changes in order value being your similar

Matt Gustke

Yes.

I'll So, one. that start

prices of extent COVID elevated handbags really. per men's jewelry really AOV underneath more is have our products. throughout a shift mix back Selling on And to and that's So, toward prices remained items some and selling transaction. the

that still the fair quarter. the in with So, to tightly total that other available supply was third But the expect supply of throughout fourth that's units into more amount we'd abundance correlated marketplace the continuing of a down quarter. the see per transaction part

up overall it So, supply to come was that's back that and pre-COVID. back we'd get our start to to expect up where back our builds see as where AOV

Oliver Chen

Thanks. Congrats Gustke. regards. Best

Matt Gustke

Thanks.

Julie Wainwright

Oliver. Thanks

Paul Bieber

our take Operator, we'll question. next

Operator

Your next the question your line is open. Michael of line from comes Sir, Binetti.

Michael Binetti

here. Thanks our guys. taking questions for Hey

we of headlines So, to off starting But We're flat at the spiking more short-term And seeing to understand October. ask you're a to COVID five getting want want you're think November, GMV I I how obviously one in we're you to December? I positive a the us the here. again just sure But prepared quick positive available again. these building back I'm on -- with would were hurt that negative that quarter until nice maybe on that saw assume last vaccine back time But which there's obviously, than getting got you spikes. walk I supply you're would news please? today. how through through could

Julie Wainwright

dynamics a out COVID is Matt. answer not team not I'll have up then little drop-offs turn But really we LCO product away. right over We safely. I'll to stores how it sales look it but learned are consignors really would and key only going just us and there. Store say don't changing with our markets live a our It's I open, bit though has also. -- for the few and even pick stores drop-offs now to in

So, couldn't all. at before big we a as shutdown where had we about we're worried operate not like

in it urban certainly -- control COVID the rampant, it's but than was going is think areas more I before. under

-- as in --- we we seen testing Alto. be able the able Palo and we the we're So, improvement supply. grow in one like We're we feel will LCO to -- continue some also to said, open in going that's to going to another to -- be Madison we've supply like already store mini are on

plus out gave pretty mean we where are in good the I feel LCO what we XX% retail October. the up seen year-on-year number store So, -- off drop on we about we've

I we think as it winter. bodes move into well the

giving So, good. feel during time. gift in that's And expect -- why do the we think to holiday's we see seasonality

have want it's uncertain good. we We times. indicators we still sound that early overly feel but So, don't optimistic, enough to

Matt Gustke

just Yes. level. Not think but to I slice finely, add to too another this

to couple of a was out from into kind October. really and little big October, sort And GMV amplified pick saw by that is had as what steady back But but of the QX hit inclusive we So, season. going things end started of were site then two by know then to driver for lapping a up the in momentum recovery of end relatively bit holiday the recovery weeks three was kind of thing supply tail the of as the to improvements throughout benefit into in General of of October. deeper a the a that And Retail middle a that -- for retail We of the followed. of us weeks, stalled coming supply. little quarter. it's that's four retail LCOs. Michael get not end supply going to in maybe October even you and the we or of in that

Michael Binetti

-- be the probably quarter other a Is trends curious your quarter. room decelerate other similar the that only just in -- that bit take through you're fine but and is on a if high-single of like leaves supply other that's coming looks area tooth of is in are retail areas? question the in other Matt the that it channel be I still the to XX% would would in It Or through shareholder in fourth for I'm the It's Okay. over XX%. that seeing LCO areas? digits channels to means we out the in seeing it in that think you fair the looks get target. would growth seems up supply you supply what like -- answer, be conservatism -- quite the like And rest a said double-digit letter. the It coming third of it

Matt Gustke

No. That's about not not it. how -- thinking we're certainly

because So supply there's apples oranges parts little it. I those units. answer the a won't and versus But here's supply all I'd bit value what characterize

see we like it it. calling are We

guidance. in unnecessarily world there's serves uncertainty add we don't our conservatism the that think anyone by I top to of on providing don't think uncertainty well. I to so, enough want that

think all as happen, transparent can -- to what possibly we're as you that's we so being we see be is are telling the exactly can we around we So and uncertainty given of us that confident balance the quarter to the of thinking we're a quarter. entire certainly there return the on growth deliver the exclusively laser-focused just short over us this is And about but not term. to getting -- not organization going

setting on momentum. year focused to up strong very exit are We ourselves the with

So bounce-back that then behind part story. can be of when the we is really COVID us, a significant

Michael Binetti

Thanks the for guys. Okay. help

Operator

is the line UBS. from comes Eric question of Sheridan next Our from your line Sir, open.

Eric Sheridan

question. Maybe come ramps? some are Thanks so joining newer does reps much that back for the to taking how the compare now I'd organization sales that to efficiency of the

Julie Wainwright

him. we lost Oh

Matt Gustke

are We with lost Operator, still there? Eric. Is still us? he you

Operator

call. Yes in end. and sir his -- connected at his open line showing on line still still I'm our you're the He -- least and

Eric Sheridan

Can me okay? hear you guys

Operator

back. Now you are

Julie Wainwright

back. Yes

Eric Sheridan

Okay.

organization that. curious compare? I whenever to the about and on two versus then cost earlier ramp if from joining the I impacts versus the guys. I was side now happens thing, this in standpoint that Sorry of that how of you're anything apologize productivity expenses missed period what think might nature sales before a about then the reps an on it how the about a pre-COVID efficiency those seeing other nature, transient structure Thanks call, from on permanent but COVID-related variables? we're And

Julie Wainwright

I would team we've So and for we've opportunities some ramp how improvement. still we're to our train some learning wins had say, had our and team and

used people other. to in to So COVID shadow used it We -- challenging more times. is each

big say wins, I but uneven it's that So it's some uneven. would been really been

that. now we've so work think our work how to of for But That's been doing long-term in virtual people, seen. few a about months, right to over time. off of trends more some getting notably dropping store. and efficiencies in as taking advantage on tool. worried possible product the expect we're we've much have still I we efficiencies a only that a virtual -- We're new So situation more now LCOs training lot as do the are again of new bringing do learning Most and we interesting that people at a with

on forward. capitalizing moving and we're So that

Matt Gustke

amplifying our new months of always couple it things so a other ramp. A that, few takes Yes. salespeople to

Julie Wainwright

right. That's

Matt Gustke

the we've of in been of hiring of how the that In the But since intensely number from weren't to natural because the one terms amplified next of salespeople. That's change the beginning the quarter anybody. second quarter company. trajectory kind we of the

had of we fact a go. salespeople let to In number

So the where that heading from QX, a in sheer can to we're base. is low point any of new the period people percentage number that than of as really I higher remember

into memory on $X From about the expenses of we off. for of at after million hit. normalize. a next that productivity least to as until short-term COVID-specific Hopefully think continue should that's and million COVID get at we're XXXX of this expenses. sort COVID year are by a past year there's is And with trail million we quarter to looking I kind well. which second So COVID But think about to realistically should the at $X next question think going next expenses time respect summer in it and as $X.X I

Operator

sir. Yes

of Boruchow your next Your the line question from Ike Wells Fargo. open. comes line Sir, is from

Ike Boruchow

Thanks it. couple next everyone. Matt high I gone understand to level going on question. make the quarters for wanted I much business to penetration today what's just of of so and the year mean the to kind into dig up. sure QX how just Hi for has thoughts the direct the last into about obviously think I

year-over-year. the out look of to helpful. normalizing time Just going would be start on take going you fourth that things see do think margins and this understand about then I going anything by year? on. The of the to how kind what's amount until have on improve? think this explained been to Trying down into the what's gross you've into some we Is drivers decent there next how profitability a And quarter? as to

Matt Gustke

Sure.

those of so So that that course we've from having returns as on that have coming harder who of the basis, you originates over back lack accepted component GMV has product been touch inventory direct gross supplies year of And of about that to really and sales. due and It's that's to our a yielded had our come on largely customer a historically this product X% channel. our on balance booked that revenue to total the for Most as a anything relative familiar, we inventory. from higher we late sheet is that has is from a aren't sell of that's that's that X% had hand. we've into of

temporary a supply that's So should direct component normalize phenomenon. as that build back And we out. of

to. Now we we that where are consignors of starting we business still to offer yields individual sellers buy better products both very small to we or use of a end buy program day, products that the though selective offer a for vendor slightly selectively ramp upfront highly upfront. in us at some and margin but with the the it's That our we're that

our mix by That's order. really that where the get you variability. and doesn't matters, per pressure. So to impact it that which are and the bit a small down be from little given impact essentially That GMV said costs forward. impact has of our overall upfront gross the it's expect ASP that a subject going margin of of But part a material nature fixed really is that profit what is small a relatively any the where business to have now time you GMV of small get and to that comes

weighted it have So going XX% gross material average margin. variability going but just teens low call it you're the think anywhere I to margin on a to see from really impact doesn't forward percentage

Ike Boruchow

Matt on today makes clean you inventory on And is that right there pretty anything Are inventory now? with balance your uncomfortable? sheet the you the

Matt Gustke

I of still yeah. quarter Yeah, inventory $XX I million. at our mean, the the it's sub think end yeah,

about yes So still in inventory thinking things we're not small at any very of risk. scheme inventory balance a it's the looking and that significant grand and

Ike Boruchow

Good Got it. Thanks. luck.

Operator

Edward the is line Sir, Yruma from KeyBanc Capital question Markets. your comes Your next of open. from line

Edward Yruma

guess Hey, good Matt first question. I question. for taking just quick modeling evening guys. the Thanks a

approach be in said digit flat. somewhere that and yet shipped is double You expect GMV to expected you to letter units the shareholder

competitors mix two I and XXX Do issues, to the I downward you take hold publicized I decrease in ultimately that seeing just been resulting categories. seemingly pressure items And of these a you square kind sneakers year-over-year. these then out Are watches? some lower of wanted some you second And there to comments. rate So expect of medium-term? mix some mix incentivizing in short you. -- think and pointed to on this are those like guess have some large Thank favorable hot but bps

Matt Gustke

will supply/demand. you the category to start about terms the with want maybe talk I seeing, And some Julie. of Okay. we're

demand out The we anticipated knew letter coming what shareholder imbalance that's supply with supply in So in the consistent versus we ago. supply in with happen we what where outpacing entirely we reality a what the a in fact of laid we is year were deficit needed out and to a year. available were

forward. So in in we going to We in so true balance, get can the needed supply marketplace even order and level. to lockstep demand back first can that water back get -- grow to

So math. that simple the is

So I'll back the And piece. growth high-single on enable then in digits of in balance to to if GMV category positive start the the side. growing that the year we're seeing supply the get will us over

an You're think not short-term mix right. that et or jewelry, cetera. have the holiday In -- I COVID take price that's with correlation the mix. inverse watches, is Higher because products selling stays rate, that very handbags, typical

are interesting the bit maybe consistent we recovery seeing categories particularly what we in holiday those categories. more a So get of with season, levels I signs get product expect QX peak little frankly, of higher then into elevated the as see into as less across next year, but to we would of we saw or

see what we end not historical closer we'll was. one's that coming buying Particularly to of its the get like to I back as women's back COVID, well. to as drift it's is ready-to-wear start no level So nicely product our think mix

Julie Wainwright

to We competition, going a really no world increased self-posting marketplaces That's feel commission when TAM. don't them start our peer-to-peer, large And way we base. maybe the aggressive such down commission. have consignor especially a not compete. you're isn't for It's to talking or really when about really

And so that see any don't competition we product at for as all.

yes mean TAM. back that's -- that fairest And us nicely very think to say in for for I getting do we just again I a it's product in but way it's getting the So coming participate but the large probably just in us.

So...

Edward Yruma

Thank you. Great.

Paul Bieber

we’ll Operator, next the to go question.

Operator

Okay.

question Sir, comes of Kessler line the next is James. Your from line Aaron Raymond open. from your

Aaron Kessler

couple as you. you. kind at some could just Thank a is historical Maybe Thank white Or glove glove maybe term? the thinking to home price? potentially that you the replace supply acquisition. where on about expect deciding questions. see mini how kind of for send sales you be are And first you of forward? a cutoff when sense changing Should are how Great. to Can by A service and that of these give by me for mix stores the rough a of person of maybe going today longer person's you sits looking some well? you how white we out

Julie Wainwright

we've -- the hasn't much. that been because pushing into we high mean, categories changed look, Mix certain I mix seasonality. go

sell of fine So we've watches. and always handbags, jewelry lot a

see prep go for site our normal and to of any kind seasonality. just it's promotion, you if you our So high

supply off take XX% up a at things we we about the moment COVID, shift, a first the when it's LCOs On good to step we of before to saw were value and where coming think the I -- When mini dropping got saw stores, people into channels. those back. probably stores, a

the the did of changed shift that and not work stores with in we type So people LMs transaction facilitate our our with that consignor. those

the mix, that changed we would more work these stores can in efficient assume have up we set answered have then associates for to working us. of consignors be -- -- associates the more associates and assist a know a those will sales and are I that different they question. entire I more stores that. consignor if we've don't mini So model if they we

Aaron Kessler

it. of Most

we're glove forward? traditional other then white what how thinking question in-home the -- about going is service So the

Julie Wainwright

pickup. really Well, We've work the off. But even we've appointments our way we and works. we we than qualifying had and they always the X.X the a kind cut them close virtual have into this value We've of by it before someone's always we -- the and send us. fascinating nature with more watch to home. always if been of that's of go to -- -- just curbside relationship sort with -- the times going And gotten average consignor has about consignor our home into having

store. we've don't had and expect especially that market, a and that, of change in may always associate shift What start hiring to people mini stores at these mix change if all. the maybe So it type the more is sales the in market, working regional would I in to a different

Matt Gustke

people. But exact be. in-home So, and a want that's well appointment certain virtual appointments a we're Interestingly, know. stay been to the mean our here largely to it clear, mix of going to We're again. certainly consignors we uptick works going very I the end the of style our very of for forward, can versus let is in an don't providing lead not just sure see virtual because as COVID in-home phenomenon. to as that consignors are for us interest there we've service we day, starting the recently, they at and satisfied make the It's

of post-COVID that's life. kind that So of settling trying people about sign us are think in another to the to I kind think to

Aaron Kessler

it. you. Got Thank

Operator

your is Your from & the Rick next of question line Patel Sir, Needham from open. line Company. comes

Rick Patel

provide this business. vendor a you do I everyone happen of and is mentioned afternoon see question well. I XX% here? quarters? coming I to as Or it this trajectory hope areas needed of over the the long-term a curious investments as to Does target? believe the on color growth think additional we second, And the about Good programs. you just I'm this the next would But support had you margin could some on that the can be XX% year? how affects reach

Julie Wainwright

more changing our in probably vendor people of plan within really team, team that that quite not staff category in more category. the a bringing level. already it's and changed strengthening but to an at it's to We've get expertise more happen. we'd to entire XX-month of we're senior and XX have We've that next long-term, expect shift more staffing But It's XX the the months more the it's there. getting to started

Matt Gustke

Yeah.

part And is impact hard has get we true but of to of to higher the focus. how But it is because can similar multi-quarter And in staffing selling been be technology certain of know up key and need be. Technology to a category getting to and item. average that quantities But selling vendor going price that's really terms to the journey what's and it's out it there another a expertise streamlined. similar that terms in support -- than we of so multiple to build creating value product -- portion And historically, that launched per tends strategy. exactly margins of on don't is significantly say what the product. if it's itself

average. the be it gross rate tends translate Now to take of dollars number per but to higher significantly and lower, that of dollars than down means of profit is actual it when you course the GMV unit,

over be should to it additive our contribution So time. margin

Rick Patel

your promotions competitive holiday selling on the price price starting gross competitively? with year? terms you can impact as perhaps And talk this about backdrop margin you you in average any Are to seeing well or need earlier as business of

Matt Gustke

price mean, a I'll up quarter, was that. X% up be Yeah. average answer. continues year-over-year. selling in simple No, it's our to I the start

promotional potential. is that that's is handbags, particular mix much have connected seeing just toward jewelry retail that have which skewed environment. So now, the less inherently of not of right the given products we to we're pressure any watches, impact which more Part

the Bad supply more and back starts going a in back us coming to nice right going be back that demand good but to that's forward. So even it's as women's for so the coming come to ready-to-wear, be is be problem going will have to news. news so

Rick Patel

Thank the you. best. All

Matt Gustke

Thank you.

Paul Bieber

move the we’ll Operator, next to question.

Operator

of your the question open. Susan line from is comes Ma’am next Your Riley. line Anderson from B.

Alec Legg

Hi. Thanks for for our It's Susan. question. on Alec Legg taking

they Are mall locations the centers looked store of on those back go chance? locations city formats; suburbs? into targeted? to details more to And on you provide Just able by you have mini any then type or are you've

Julie Wainwright

Yes.

is best the is in we still a it's very York New -- our we City, very again neighborhooding very example but neighborhoody. Certainly store. Madison urban store test So have which it's

markets. around key looking at we're So neighborhoods

see our this still City important works. how we're goes. New and going looking is We'll see So York centers going states We're New center we're outside York and how it at store open Again in test Texas. Jose. still California very and we're Alto. popular of but that Palo looking to that But to the three main first both outside San

we'll better find nice sales. we fairly there's We retail for still the including us of a percent continue in looked they're to at of they malls a still lot customer many don't are of really going have for better then we in look They their us that malls. neighborhoods are where look financially for X,XXX-square in the want to space to in reasons now adoption. cost out aggressive different perhaps foot think When X,XXX at -- and everywhere terms us answer like they space for they're structure be

Alec Legg

And able four then to the how helpful. I relative Are that the on of that general just guess Very And new locations? provide the Chicago other store? you reception on performed that. Okay. congratulations store, to

Julie Wainwright

All right.

happy to the are am. precaution location roof. and store well. a this It I'm the under off had very It's biggest so week. best I to opening on our thrilled. going coming I say be The was great continues yes there just election. for it a one happened as ever weekend. still boards boarded to on Avenue, Michigan We're am you up were So do asked was we've weekend glad stores as question. single into opening the it a I store most that

think I square feet, two but LA has different similar stores. it's

You have one. the into get outside to to go other

looks So a it's good off very, it very like to start.

Paul Bieber

think I our take And operator, question. last we'll

Operator

last Markets. Okay. of question Sir, the open. Sir, line Siegel your your comes Simeon from line BMO from Capital is

Simeon Siegel

you'd versus of just mix back your you. supply between that comment catch-up? to was like-for-like? that normal run how quantify touching Matt any and demand way afternoon. on demand or a is the And a Thanks Thank increase much supply expect ASP delta single-digit the everyone. Good lag then to high is

Matt Gustke

catch-up. is Sure. entirely Yes, it a

of third the supply in the available the year-over-year throughout Our quarter. down approximately was duration marketplace XX%

of So, this really to normalized a allows us kind get state. to back

me and a in going are always sell-through. have of at to There or And of But just that on go an kind get not the second we the supply state, remind periods forward. annual back of in demand and lockstep question. build least even -- in it's month so normalized case play into kind given supply can the supply Now, then quarter. catch-up we balance of a basis that

Simeon Siegel

versus-- mix can You quantify

Matt Gustke

all Yes. higher men's are a watches mix. towards handbags jewelry all It's mix and smaller than is... average. degree It's Like-for-like mix. It's which slightly

Simeon Siegel

do have pandemic And category view are versus trends? be product might focused mix Great. excuse of longer-lasting on Thank me you. which what a these you

Julie Wainwright

jewelry apparel QX. are although think it's back but than think honest, is was all. men's still slowly all I To focused is and and is it's it apparel down be because better it's I watches growing coming fine growing. during Apparel pandemic significantly

Matt Gustke

is men's-- The one that exception to Yes.

Julie Wainwright

In are shoes -- down. shoes wait also

So, shoes apparel. are more down than

that's a So, level. entertaining pure I somewhat think on

categories We rate more and go out back normal work a versus when to to expect occasions. more go go get and those people often more return to

Matt Gustke

under-penetrated the with relative exception our is Right business of still men's that significantly business. rest the the to

continue the the over So, grow expect at rates we than would that see years few business. to next to higher overall

Julie Wainwright

Yes. And growing it's now.

Simeon Siegel

of Thank you. luck holiday. Best for

Julie Wainwright

you. Thank

Matt Gustke

you. Thank

Julie Wainwright

you be it next side Well, will the that of we'll holidays. time other concludes talking to The our the be on QX.

and wish I holidays to you happy want very your I a appreciate time all today. So, Thank safe and much. you

Operator

your participation. call. and conclude conference this for Thank does Ladies gentlemen you today's

now may disconnect. You

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