BIRD - Earnings call transcript Q4 2021

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Operator

Good afternoon ladies and gentlemen and welcome to the Allbirds' Fourth Quarter and Full Year 2021 Conference Call. All participants have been placed in a listen-only mode. After management's prepared remarks, there will be a question-and-answer session, at which time instructions will follow.

Now, I would like to turn the call over to Kyle Khasigian, VP of Finance at Allbirds.

You may begin.

Kyle Khasigian

you us. thank and afternoon for joining Good With and Co-CEOs; Tim the call and Joey Zwillinger today are Brown, Officer. Bufano, Chief me Allbirds’ on Mike Financial Allbirds’ Co-Founders and

revise detailed of X-K reflect statements refer release our to, substitute remind that that number earnings SEC this our our these we and affect today. after actual outlook matters during the could results you statements Before and our today that results. These results. within GAAP as filed securities financial factors other to uncertainties involve the not forward-looking for release referenced meaning are which and to be non-GAAP would measures, about occur we description items risks laws, certain earnings in call. Please well I the more as risk like cause that this a Please we to note including filings that of opinions today that obligation forward-looking forward-looking may will statements Form any materially. to issued discuss a GAAP These differ call changes of may our should used addition call, make impact start, no as date we non-GAAP of results and eliminate certain of statements adjust undertake reflect federal our only the in items. also as statements to for our the to financial any this of and a Also,

directly financial release. a these measures measures in today's non-GAAP earnings reconciliation these additional comparable find regarding measures information and will financial GAAP You to their most of non-GAAP

the to Now, Joey over to call I'll formal turn remarks. begin the

Joey Zwillinger

call. hello And on everyone Kyle. Thanks the to

basis, our brand continued between momentum Allbirds, We for XXXX by spending second two-year that geographies. the sales are across is XX% targets. in a our We in medium believe accelerate at this annual year of XX% growth headlined for a strong year rate healthy brand on our to projected us XX% a record-breaking to QX. sales to Underpinning including sales success and of in pleased growth finish XX% end and successful performance a report this consumer above a or growth row atop high heat term with year-over-year backdrop positions a multiple

march are profitability We saw progress year, here also fourth and full with targets. profitability. well long-term our EBITDA the discipline and for We as of in on our generating laser-focused in coming quarter durable towards meaningful adjusted ahead XXXX expectations our continuing great

I'd the as been Given of the our the everyone across at of fiscal iconic this experiences lighter the magical our Wool of value product, the we in in market. know we added close these promise material. unlocking In second XXXX, our innovation put brand lifestyle distribution, The the that as consumer successful. with our in enormous Tree product this elements company and for Runner. natural brand year, integration treading still launched material and advantages We Many planet. is creation on well fulfilling of product our underpin of people performance, XXXX, while have Both model; of like engine, core unique center to that remind hero the

multi-year material each the surpass This of developments In Tree is growth top Wool from the opportunity platform an as create that years. more we in of example XXXX seeing material. coming fact, one most exciting store the our was with in in selling

unique vertical, making is the unlock in value model footwear process industry. significant it This go-to-market for Our us.

a in protect It while XXXX. XX% our too. X year-over-year price helps deliver position, over full to growth, great third row, maintaining In also in fact, million for helped XX% enabling a experience customers. a brand yield year acquired premium our And we it new

And new average and Net but than is or least in those to year XX% is our power year of XX% customers who indicator their future XX. key to repeat expanding channel XX that paying single customers, in Score locations portfolio This year but XX they more early customers is are global investment on more at age continue old at repeat of compared XXXX of hence omnichannel in strong purchased NPS when our customers infrastructure year customers in spend locations for the our purchasing those an nature expanding a purchasing metric came in spent the at approach. our this of international of of trend just physical an omnichannel as repeat experience vertical least first. This Our is in we again. just fleet. the representing doors, the omnichannel not off. is This than to a was opened second we a our and twice back, more. The our not who we ended is especially X.Xx XX% see In with did Promoter their an important also focus distribution, and and retail XXXX with XX globally. important the XXXX true in continue We U.S., in these

of of China region. elevated XX% In is in largest XXXX, impact grow consumer margins Our are of quickly now future brand the first single aware optimistic the positioning outside international U.S. gross for and environmental of our to our that time, was business country our increasingly for success sales total we that and the the Chinese continues consumption, business. accounts at for

engine and course, product brand. Of our distribution without nothing be model would our

journey XXXX, an by and remind products a better purpose in of milestone When to of Plan, carbon quickly. aimed XX% per to our everyone emit our our in major our we by was We market that reiterate IPO all less our in positive a about XXXX, the we embody top more in of dioxide top XXXX, our with as sustainable outcomes bring coming plan, as part of objectives that impact, profit XX XXXX, leader about, on a was products. a this at annual together. Allbirds is to in Flight on than reducing XX% Allbirds products XXXX, by three reduced this by our that aligned Allbirds surpassed profit carbon framework carbon top that effectiveness COX set impact, by such together, carbon initiatives by aim during of unit estimate our strategy. this reduce by business like our the and footprint purpose equivalent the also initiatives of financial we Relatedly, XX% XXXX all Tim launched you Introducing expanded with by consumer end topic. volume the carbon targeting submit emissions so in the terms be. footprint update year the absolute the by our to emissions November. planet outcomes That of and and the X% native, aligned will the this expect some goals the between XX%, we we grew XXXX, with expand average and did our fact, on achieve environmental In approach we of gets XXXX that great grow while we by gross on will XXXX we started and in XXXX our year-over-year. To share are talk our and released our but goal all sustainability XX%. These in context, sales we average We to terms large earn, meaning on leadership will an by our goals reduction reason, XXXX of are additional the progress And put products grow in if XX highlights, rapidly dropped that XX% is XX brand boost we part believe I'll principles the XX%, of and have In we'll us way. our to better. financial approximately extending I'd will we and along In reduction we but multiples margins. our what goals. industry these framework improve sales more we carbon our

fourth versus a XX% and We end results appropriate then a in topline strong to growth to QX with our the recorded XXXX. and ever of quarter, XXXX. targets strong biggest XX% quarter ahead Now QX XXXX of our versus

experienced for an strength loungewear. footwear a cozy notable rate from power record This posted positive for We kids the apparel our quarterly marks through the the season. the strong was rate Black comfy offerings, particularly Cyber by U.S. we call and of had the reaction growth demonstrating we holiday and omnichannel of XX% in The acceleration collection, days, to a our of slippers punctuated quarter. the product dwellers, that fluff third our side, growth Consumers in included and us our two-year peak two of Monday exceptional our Smallbirds Friday to model. on period rerelease sales the

of to scores. of we experience than evidenced these to XX days meaning were Friday, high Black a on refer excellence We an delivered stellar superior our what volume customer as On day. XXX our demonstrated come and store want leadership incredibly easy of This Club, year. high has doesn't recorded NPS on the they XXX that recognize volume also by stores NPS in our more we U.S. this

to us the noted shut stores Cyber strength Omicron as including operations, encouraged During navigated ever. weaponize alone pulling a impact with we time booking the and that tough to in that on temporarily full markets. locations with supply successfully international been we and number were environment able throughout rooms QX holidays. exposures full models while price was old forward by that We critical on as forced QX. continuity has surge down also utilize the previously that first were have manufacturing This during U.S. of we well styles December, continued our our chain inventory grappled sized of markdowns and biggest consumers' reaction, would we day QX colors very we and in sales a our of saw the our COVID Monday

in We have government mandated shutdown manufacturing a of operations. any our yet face to

We entire impacts November. magnetism inventory result deliberate will America's engine, product that unpack flock, and of an to and people, with Employers in model. the of elongated and XXXX, spot in XXXX a and top mitigate investment were on the increases inbound continued taken our by are XXXX, we possible ongoing of our the One while IPO in financial and are of many are, this of our and Startup it talent the belief course, mission The transportation we've augmented XXXX. our and the The named potential our the power accelerated successes and supply felt Best for culture investment in bottlenecks throughout we And Forbes, of chain. industry. top contending facing outcomes strong taking in distribution of of is since brand brand, has by our XXXX our In benefits Mike their

a business confidence in of margin, XX% more XXXX create EBITDA expect for to thermally teens employer In many performance track adjusted XX% term targets mid us total, gives We tremendous than keeps achieve come. to strong our tailwind for growth, financial to and high to us XX% to brand years gross on our our margin. and us medium revenue

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via experience successfully previously. in we've this partnerships in we have Fortunately, engaged

As and an sales separate two we've example, saw with our positive excellent occasions direct awareness and halo uplift worked into in aided channel. brand on a Nordstrom our

a internally. cashflow note small slightly on section team gross and modestly seeing these be to I'll business Before believe accretive. our will as we diluted while I a of with these partnerships gets we this, trends will terms be note positive overall margin incremental early we of efforts from neutral my this be the us that to to expected anyone the close on want overall with be are the support XXXX, sales to in we impact marketplace. in profitability, in ahead And overall will

to of a COVID. related dissipates. that progress even are shift may We believe to as leaves consumer our enjoyed and provided these companies. continue bump more restrictions health the the these underestimated In many confident companies Some will we were the been we talents tailwinds of seeing than This in with of world growth peak one our significant We accelerate in us tires this, demand those XXXX. not profitability contrast significant ever similarly, quickly the recede during pandemic. to cases notable that and expected as COVID in how has favor

financials. to then Tim Now, specifics talk I'll product over it to over for Mike our and on pass to

Tim Brown

brand a tremendous with still runway here. is Allbirds Joey. Thanks a young

confidence built in of with and we transformational is consumer and of natural towards what product QX. category our our the in product meet base a believe product great solid was year deal platform have We year in to innovation the cadence materials. XXXX coming shift we for material a a selection

say with especially younger resonate groundbreaking is know globe. part X is which brand, heard testament ability we consistently materials, building around that Joey customers products becoming to among a we the the an our natural acquire million to product important create consideration, All consumers. increasingly sustainability You that new to of purchase franchises with consumers over

is One a natural focus innovation our consumer great expressed differentiated publicly on products material creating alternative. with excitement Our innovation. built plant-based benefits from we've remains our future

along planned of activation also strategy. through and lounger, the these a is core franchises technology materials Dasher new product and lifestyle fuel introduce to at world the our our performance color novel product product that midsole pipeline. with to We the Combining will collaboration across runner, continued like and

professional a bar athlete, For a is making know performance high the for career one. as my nearly decade-long products I

of runners arena overnight. Forging products and to expanded runner a performance with getting thrilled natural apparel performance we levels credibility we that XXXX, in path a this significant our And in another runner this started. including believe just in journey. embarking happen trail competitive be chapter won't has performing the perform category all create short better earned put, space SWT presence story launch. in can In our on year. of Simply highly athletes, to a In time, Allbirds we're this we're and materials continue for

on ongoing upgrade just engagement franchise yesterday, and step the reflectivity improved we introduces the deep feedback arrival customers have great X notable to upgrade already us. was meaningful first attraction. Dasher less carbon, our path impart streamlined they with The with a of level to is a of brings an less the that that the weight successful and This born foot from look,

all technical at our footwear greatly weeks early have should the As will we to naturally actions pricing We down and expanded across our of are consumer expect lead see apparel taking look versions performance yesterday's times more X a sharing product products. us consistent look the categories, up to to a Dasher recent to and calls portfolio and forward versions This select forward trends wind lead you pipeline performance the we done industry. in and reshaping in in footwear with future to that our launch. as upgrades

to differentiator, switch natural positioning been we both customers deliver all clips the skin our is comfort, Marshawn our launched Allbirds culture. and of in win across strides a and product fluff, QX, humor year. our leveraging performance, product great and to and This comfort which a key new made materials brand hallmark help of viral purpose next received collaborations series will energy performed big well example generated front that embodies Lynch complex our past long-term. during and leveraged and to a of holiday unique our us apparel, XXXX series, us to we season. the the to excitement in we our the with enabled franchises, entertain, which this core brought footwear We've to unique which well brand, around grounded In has we expect addition introductions new Dweller to of In puts connect In content a by through apparel. on to the partnerships tremendous also brought sensibility educate, sustainability. and A lifestyle topic and and Smallbirds, the our

more see You'll year ahead. in of this the from Allbirds

site Another XXXX Allbirds to traffic out provocative partnership our partnership within highlight and Adidas hours. was the substantial FUTURECRAFT. drove This sold

to resale is excited on marketplace other key Allbirds journey continue into to launch the last as Relatedly, product lives and to circularity the to leadership carbon Earth has is brands Day Allbirds We'll us announce our step sustainability. their not a of products, a of to carbon thought trading and while we program. our and way gently two last in were open U.S. amplify but our of leadership platform. Rerun partnerships to imperfect point in-the-school April, moment used official our Another calculator our allows slightly Rerun, emissions. products small empowering of thought I'll customers. extend components, franchises, launch also the when digital take new that from acquiring we freethefootprint.com, on and This week, emissions tap ownership also sourced our only

growing our footwear Allgood and Collective product products. in innovation customers the material with assortment sustainability a and we together digital explain The our of brings events, clubs, we the products, our methodology, an AGC The purpose, performance everyday provenance through use to call behind mechanism connected to influential As content. AGC another run placing grows, unique the provides also thread and in-store engage their Allbirds carbon materials with of our AGC. we our collective cross-section red emphasis ambassadors, about which leaders or are athletes, community on young of with the

As I to product XXXX, And of unfolds. a company revealing I'll enter turn Mike our believe the financials. the on and call XXXX compelling we more story roadmap the product the in as trajectory we we year forward in to and was the the mentioned, history were for to look as sold of most that discuss we

Mike Bufano

you Thanks and Tim. I'm excited our through results. to full year QX walk

the and we deep came and the revenue engine, model and line targets. year-over-year breaking orders use color remarks prepared deliver in increased our some to omnichannel of up at P&L EBITDA to order our purpose-led the topline together P&L. my add quarter net fourth QX. was In connection average QX, and authentic strong X% revenue profit and In gross above of with top press I'll our adjusted what product record in brand, each of accelerating $XX starting and drivers change million release, all distribution Our performance of materials guidance the the innovation XX%. drove performance noted the value down customers,

the For and AOV increased increased orders full year, XX%. XX%

customers big and launches, were strong Our factor customers repeat product delighted here. new attracted which the

an The was growth other price AOV a the increase in contributor to small August. we took

internal off of the quality Our that of in the drop shows the products. speaks which no power band, we our brand and our effectively to analysis saw

drove Allbirds shopping retail. habits and made geography, grew said bit to uptick they allowed season. U.S. view able color at with driver by XX% international. demand. Joey our being of a model get and and December, on our with the about look believe This Omicron our In point for in to holiday to QX in retail the we in notable is won't to year, a in I digital, strong data us growth. surge that digital provide how we had revenue share of quarter level growth Physical growth. a in international XX%. full faster customers know way meet meet We earlier The wherever wanted of want were I'll shifted us our the U.S. biggest on to physical at growth this We the how have in some chain our channel That in and we more revenue Looking omnichannel channels with the QX, last was with each supply how because engage performed especially position by That about balanced being instructive both XXXX. for and XX% builds the to the year we you revenue detail the channel. you business. geography full at pleased the the In U.S. think quarter, saw helpful said, of is is were the the XX% for growth more

to the channel repeat So, digital we're during $XXX largest In acquisition. simply, come shared for and including we accounted customers detail and with two to away back XXXX, business. sales. the Said remaining roadshow. new of we Two, XX% growth products what for customers year end this drivers remain The of to colors we we One, digital call. over new and digitally-led XX% and a new a consistently continue more digital acquire styles. of grew far delight of profitably source customer million

this a continue bounce prior stores from back of in surge levels their XX% opened retail. work to of pre-COVID saw compared the of physical We Our XXXX, saw way towards product strong in improvement XXXX XXXX total $XX in heard from the in in four-wall when Omicron in new more In also class spite of contributed in stores year. dollar XXXX drove Within innovation The XXXX. stores market dollar These combined before to growth profitability Joey. stores XX COVID with rest back XXXX repeat a retail our seven XX% of group XXXX opened the growth stores, the contributed U.S. data-driven sales this December. stores XX doubled, growth depths to physical year-over-year from you the personalized in million. of as and growing XX going to XX XXX% behavior than physical the the with and purchase opened QX, marketing nice and retail

of EBITDA million of forma we U.S. basis competence on million of P&L. to these for classes store in retail, to margins. XX.X%. low expanded new estimated gross sales of the moving the us impact down and XX% profit targets our XX performance U.S. $X.X forward was points store increase the to four-wall $XX gross XXXX $X.X the targets. XX% and previously When by pro keep continue U.S. I'll gross shared COVID, Looking in and In of an XXXX, million, give especially QX margin fleet adjusted

ahead gross profit our year, XX.X%. full gross million, while increase margin with points by to the guidance in was of and expanded XXX margin an XX% target target, gross $XXX For to of of guidance our XX.X%, basis line XX.X%

For both retail are both gross in year-over-year and the gross QX a margin a gross driven international profit by full was accretive. and margin improvement which year, physical faster growth and in of

us decrease The year-over-year business Two, costs on shift saw and distribution retail, other cost at made forced which of the points favorable logistics facility mix in higher and to we costs in partially to compared issues in tailwinds DC Coast full to on color greater us volume XXX providing a of gross expectations, drag QX to COVID on versus product low some points margin sales and a QX December mix. excess the our of landed subject to from at on and of labor affected here and One, headwinds margin an creative. headwinds retail costs. both were and gross our and gross percentage that demand year. that wrap-up increase, gross XXX basis and Omicron U.S. margin improvement the Staying tailwinds end lead product the both In up these estimated the ship Three, COVID headwinds, created margin digital. physical now physical inbound the range. year, in is price our guidance to have that margin in These West basis of factors basis DC. gross channel shifting Coast digital XXXX. by end us our Altogether, gross a with costs, point choppiness XXXX given how These center from for on XXX margin offset the by I'll had in our improved of the headwinds, outbound were spite we margin. traffic the for by to gross delivered East target

gross want release. marketing in of to privacy Apple's the did impact below changes. proactively Moving and earnings the the change of our around address marketing, drivers SG&A discussed question are of likely I profit, On

the diversified As ad on we a marketing dependent and not in other for our built media have Facebook or mix past, channel overly shared we single spend. any are

increasing certain I'll million, high public out costs, advertising versus segments on approximately full have year. loss are both QX wrap QX in adjusted SG&A. on delivered loss our sales XX% XXXX flow million. the $XX.X markedly ad expectations. of guidance improved our full and This XXXX $X QX year walk in company with spend, our EBITDA our full to million of were adjusted the due a an adjusted EBITDA, basis. the our adjusted of EBITDA Backing our costs to EBITDA EBITDA performance We $X.X of digital by favorability been exceeded targets primarily apples-to-apples in end the some line through would in adjusted which improvement in an positive the While, upside narrowing and were up P&L and year a costs XX% with improvement basis,

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XX% For and context, almost ago, our goods this in-transit finished about a inventory one-third. was year, it's year added of

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start we we take in XXXX these XXXX of Now, on XXXX. to expect the targets. we coming be allow EBITDA headwinds effectively the may actions fact to add believe this be incremental that be into positive. is partnerships timing net couple and premium on price At items XXXX our to taking After turn in only guidance to Joey revenue deliberate increase us the modestly update Two, One, in positioning XXXX net pricing Despite with X% we to notes like factored depending talked neutral provide revenue products experiencing to an be brand price facing cost what's will them targets. included year, pricing about, as our that is pricing. taking accretive believe industry drop to to will prove expanded I'd some last adjusted to X% and a to off our XXXX, while business after guidance of our approximately time, in let's will over Again, prudent. on I'll in small the quality growth both the and confidence actions transitory, we elasticity. to have are the demand estimate time, following no a months. retail

and stores represents year XX% For a That to target versus $XXX versus million $XXX at XX an $XX term This primarily our the revenue assumes net we primarily high guidance XXXX, XX% of target growth spend raising our we're XX%. CapEx, stores. end to to above XX% U.S.. to $XXX two basis, on net revenue, those is XXXX we range expect In of XX growth in million to the open of $XX XX% in guidance will XXXX, on to target and from of new both million to a million. medium That's XX%. to in one million acceleration XXXX XXXX year and new

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to an million of of XXXX a range represents our midpoint For we guidance XXXX versus are adjusted minus target $XX of million. EBITDA, X%. minus The improvement that range $X at establishing

reminder, $X costs, a million million year-over-year a includes expected public increase. $X As of company this

targets are XXXX not our financial just targets. Finally,

If we XX% adjusted As Joey XXXX. by by footprint by to reduction our reduction to mid continue make the mentioned average margin, X%. footprint net towards XXXX XX% an will of earlier, revenue margin, additional in XX% EBITDA meaningful teens XX% of XX products XXXX plus aim guidance to targets gross these high targets, we in our reduce term unit and XX% growth, top progress a we carbon XXXX, achieve to per and our medium a carbon

year. representing into are experiencing far, guidance target strong a bit the That an to in year of January, QX, the Looking a trends XXXX XX% choppiness month XX% QX versus to thus of growth represents the versus and acceleration improved $XX at million. After for to when $XX QX start setting XX% high on of XX%, a and compared of million providing growth Omicron up the later revenue early to to XXXX range net in two QX. February us quickly we end with

EBITDA, historically of $XX minus guidance in look that, a minus year. we year We're affects target to remind which to of With that target and updates the million, million, open about to Per the range is our build ahead EBITDA the million the our $X of million up the we things on full $X of Q&A. company QX calls. minus throughout sales expect QX you quarter. to providing year, are minus let's guidance year to adjusted I'd excited forward to at cost. on progress including future an our $XX like EBITDA public absolute For lowest providing estimated $XX quarter range million dollars

Operator

or Stifel. Our a first comment Jim question from Duffy Instructions] line comes of [Operator from

open. line Your is

Jim Duffy

you Good higher in want spend fourth came start talking I that They well. expected. about scored you. guys Hope thank are in the quarter. quarter little than the a I marketing afternoon. fourth doing Well, by to

performance And your a investments top Did aligned marketing then expectations. the with I mentioned of have in fourth funnel follow-up. you step quarter? You up marketing was the

Mike Bufano

a thought got then bit little up across we remarketing quarter different their more ended line rates season. the bit on in moving we higher good Yes, spot customers in customers, marketing. with we're the our of the And which December, we paying especially earlier the is as in on little we into helped overall expectations the spend, slightly quarter holiday ahead a -- we up because the marketing. did channels the point land And repeat performance a with on think on demand

Jim Duffy

I see.

your in There had new response embrace playing inspiring then decision consumer was talk card you some back had to through direction kind change marketing wholesale. been of or in pocket and I here the in through sort to XXXX strategy, marketing, a to of anticipated even about Okay. of And the wanted your IPO process? lens that's have this

Joey Zwillinger

about We've work this. market, got pretty being indicator brand Joey. is and been and future this as course, every upfront highest for Jim, is growth really which biggest of We've That's our awareness. awareness in day. about in Yes, important our to we something U.S., a talked at the XX%

mentioned, one is And with for also going mix credibility it's as we awareness take it's aspect of focused the that not on. we overnight. something about build we're and we're So, to that that performance. XX% granted It's about

consumers Jim. showing But of of is right One important. couple a it's points places something all, to we in so in model. incremental of you're as the that's up right to front core is when the of first remind And you thinking this said, about that the

slowly doing it reiterate this is to with -- meaning in think that And our weapons channel that to on we've assortment. really I'll purely and we the brand kind in methodically to sales seen the also think it and that have accelerate with that focused the so we I on differentiated that actually here additional front topic. consumers. make So, about be show our And demand haven't it we're there. capture as that and think before. product accretive clear, third-parties EBITDA something our done just assortment we targets there. great further, -- element And of right halo, this we tried of sales can additive. should a that of we've channel And of working that that today, in our ability we've enable of it's will -- term should are we're great out kind up medium set core this. all in going bank introduce it's a and just lot product the we execution this And that But it's that an all be this had we really to we've important translate to And that's mix to owned that

very is expect what deliberate I and be this quite as strategy, one, say productive to slow do to incremental we're the absolutely to so not reactive, would And very and going model.

Jim Duffy

on of might XXXX the numbers. who questions you to going get of share and this. in those -- scope can But about delivered speak you we're some partners embedded doubt, into maybe details embedded it be? No what's Understood. Mike, to channel about could get just a what's little revenue

Mike Bufano

to we'll in what some we're do, been for reason introduce Jim we've this fantastic is this for think is want I a something we working going to on the is, now, partners. up while. And -- show

brand a of That's with a into get We're a few This want to slow first. about is sales to very I'll This brand about isn't ahead want that as is build can strategy. to methodical we we brand, a think is This make future. really what about sure this the how continuing so results. near-term financial strong we building proactively, And word, it and a here. times ourselves. going but don't not really something like ourselves we repeat do, to share a probably we're community,

up if a slowly be and heads And so this to there's share else, early we're do just that's going we're certainly about and real -- this. we're to nothing And like something going we'll consider transparent lot. something not very a

we'll So as share more this unfolds.

Mike Bufano

All right.

question. Thanks next with on more Jim. move Let's question. the we’ll to you chat the the And on for follow-up,

Jim Duffy

Thank you.

Operator

Thank you.

question or from of Hutchinson the from Lorraine comment comes America. Our next line of Bank

Your line open, is

Lorraine Hutchinson

breakeven adjusted question to sales outpace to EBITDA wanted expectations, growth a flowing reach in flow-through. your does Thanks, what's XXXX? your goal through to sooner If guys. I of the about that continue confidence previous ask than

Mike Bufano

Yes.

was obviously upside that worked. through the sales in the mentioned I pleased prepared in QX, bottom the saw how that of flowing some we that line, we're So like upside with

to some want And in we I future. it's I'd continue that future. of the reasonable the think to say, assume to

for So company line especially And be be We out to of level look that path broader feel a We're adjusted flow-through know I the pleased in quarter we good costs. and improvement. of question like saw putting the now, public the of very sort bottom at will when QX. in right with headwinds the look same I We this EBITDA. you QX. it's at the there full happen if to don't effect that in on

really we're right building pace here, this the business think and right the we're we long path on for and So term. the

Lorraine Hutchinson

Thank you.

Mike Bufano

Thanks, Lorraine.

Operator

Thank you.

Greenberger line Morgan Stanley. or Kimberly question from of from comes comment next the Our

Your line is open.

Kimberly Greenberger

wanted I ask Great. store you about revenues. much. to Mike, Okay. Thank so

volume You Thanks that were recovery we look talked you run understand like those at so down still help can and here rate? Are XX%, XXXX to compared improving trajectory? on nice much. are you an about run stores what rate some XX%, XX%, we open looks When pre-COVID, the XXXX. in in us

Mike Bufano

really X.X like feel of just and and share, COVID should like of everything focus on we there. new just sales like class run opened with XXXX new up we which million to you What what said in trajectory noise it cohorts. really is pre-COVID in good I capital. plus strong now with remarks,, stores right continues on us granular confidence give so a think target. that way store to of the and XXXX, is us, all that those to give by and million to of get would recovery, I part, feel working class stores, we very not those really COVID latter more during The that on all right the There's prepared like I retail gives things in a We're the X.X there and so us to XXXX, continues breaking going use any our confidence channel and good they've made they're much levels back in going a Yes.

Kimberly Greenberger

Excellent.

here you you are XXXX? that Can for in a just that Okay. you Thanks. for are in follow-up just partners some what Great. the us then, are looking the wholesale for wholesale on criteria Joey, Thanks. select And of articulate looking the strategy. you at

Joey Zwillinger

Thanks. question. Great Yes.

of we under our about of the that we a enter had that when So things five a years landscape, inbounds lot are of we've belt chosen couple to thinking not into.

of on it's today, credibility. a about And And I that. unpack think so really it what let bit are we about me little when and mean

partners in very additive brand going We're within to So up us. show be retailers. premium to to even these with, locations premium

for of focused up of we're these of people, a people customers time and to is front with a going through right the lot who partnerships. on showing for up new lot walk this first of in So that showing select the are XX%, meeting

message assortment. for and it our crisply do important convey that's robust a us to with So

of don't and know of the some lot time a breadth that the the first people noting grown about in now people assortment and for found went the Nordstrom us we the partnership, those out so increasing we've And performance. of that when use did

and this meaningful secondly, where that's where a style walking what's be here is get convey body, side about important for select really you entry-level time add credibility best running that associates on and in trying looking what's running shoe so really market, is the to asking retailers rely to and any going there's of the not in that for, store, new can we're partners gain technology it style performance. the we're consumer But curation aspect something well customers. the time to thinking the the on that the And be the for when into biggest a from safe injuries. to at credibility can sales the and long in a going that's And on side, a of is. create be first They inform what's best to

we so something the strategy to leaning sure show of And that's we're really and into up the that runners make in consumers. way kind right those for

Kimberly Greenberger

Thank sense. perfect you. Makes

Operator

you. Thank

Piper the comment from line Our Murphy of Erinn next or question from comes Sandler.

open. Your is line

Erinn Murphy

more QX on or if of into supply is QX product have on Thank to existing and bit balance I now X little franchises Dasher of right meaningful upgrading created secondarily, just shift then seeing brand-new between a the availability we're what's guess based the you. Tim pressures, any any Joey revenue Curious And altogether? they chain seeing QX innovation. right wanted just to shift focus maybe versus market. have And the afternoon. for curious, product Good with product like the Great. launches? logistics franchises on I out creating

Joey Zwillinger

on part last the take product of that side. I'll Tim Erinn. and pass to innovation Thanks, the it then over Yes.

been the thoughtful planning changes. last We've substantially, in the hasn't buffering ocean lead we're with quite then that including times a on of in great forward shipping. lot way our meaningful part, a there environment navigated timing, given and really for So

guys course, So but and which isn't expecting, thing, the meaningful into size I are have which done overall it's things quarters, shift meaningful not product but we perspective some moves, annual introductions some our nascency of a lot of from QX, given between hope company. revenue of you which does some

core it a question. over your I'll pass of And small the So on that's to Tim thing.

Tim Brown

think looking excited is lead powerful to XXXX, and it the the lifestyle, you the And and on add see beginning we're but do version We've platforms existing the cadence extend I will upgraded increased story. from seeing Sure. really aspect you're focus is it franchises question, Yes. to we're really different product offer what we in Thanks we been the is our a in What material From there. every Erinn. continue with about. cadence to to merchandising products, won't greatly lifestyle that. has beginning of Performance for through the continuous upgrades improvement able augment product ways. which and XXXX,

more to the you come, really shows For for across advanced make of a to of is very version this how franchises, consistent and methods of far days moment should of proud of couple Dasher us sort all the focus first quite notable time, feature is of upgrades. expect year. we've that really And our our ago it add those and performance sort we'll be second

Erinn Murphy

Great. Thank you much. so

Operator

Thank you.

Sharon Our from of Blair. next question Zackfia comment comes from the line William

line open. Your is

Sharon Zackfia

be to catch what I any color Ask there's mentioned, is psychographic over and or about wholesale, there. before some some kind which a wholesale you customer with Allbirds' I curious, have capture guess a lot awareness then North And or of American the to over of global of a if I converting the are you I point? geographic us rate particularly this done this for didn't at where addition strategy in though, And you've with? on can area Do think Nordstrom. impactful asking you was coming I'm can about. ecosystem you the anything know is appreciate that then credibility also strategy. share you

Joey Zwillinger

thank you. Sharon, Hey,

the and each kind and basic some looking start bit I crawl mean back I And approach see reach that the loosen XX% We shift hit. and demand show style just the upgrading people terms up that of back well little a particularly those demographics lot just to in make And think customers demand, coming back want here. to also of a that that dynamics is behind for before to the psychographics, seeing U.S., these are of looking to again, see going run as not there on COVID it's just Asia of So footwear marketplaces their are we we're and when thinking And course, in you'll follow most here, for in restrictions the versatility we psychographics. really us consumer we're want and their of geographic with we're Europe. part in to this in wardrobe shifting about nicely. year. will

very that to want we within the that yet. own in frankly people psychographic I give great lot as were capture meet we rate, and and really something and did our particular target us people we'll obviously two too just are on so on we've for show with this, mean, driven efforts meet that new And read places that earlier, about CRM are the And know channel. just well and sharpen do to Nordstrom we we partnerships loyalty, our data that. a small, did It's a Sharon our focused that rate, capture up don't on the yes, us

in to those we're of with consumer entire assortment, extent doors. or to need to our same going to the some deploy the the We every to of retailer tools the expect right our third-party product line walking show of expanded course, mix We those with for possible, of not give through up partnerships. the some right who's retailer. breadth And,

major very And a long about lot you business, stuffs going the and for that's that, primary of will our driver think the true own of time. stay of best be to there, when a so, channel obviously, our something

Sharon Zackfia

these Do off them maintain? want pricing you to won't architecture maintain signs? question. have the any retailers that follow-up XX% And we assurances one sale Just you have can that you see

Joey Zwillinger

fact built incremental where conversations, years be don't Yes, for these really would allows business. these us to that retailers is This the enter business core into fully us. direct, to to it that to need we've this the over And our disappointing we given five strategy. build

we're the frankly, the a going doing there, last that price maintaining are that someone said, never finding and we into would we're price supporting really brand yield want that. why the we don't efforts, full we is we fairly full expand We with our building relationship disappointing as slowly industry, we're in number without really anything business and And of us. high particularly enough and thought would for move want a lot maybe to reason to partners that's for early year with not a brand or critical price. premium high, doors methodically. be but our And journey who high enter that degrade year, if even and so to one for unhealthily impressive XX% maintain the that position, might And

Sharon Zackfia

Thank you. Okay.

Operator

Thank you.

of Dana Telsey next Our Group. line comes comment Telsey question or from from the

Your line is open.

Dana Telsey

everyone. portion? partners? inventory product you break new what for second think half we Two as do afternoon, wholesale path for here year costs between half out the What these it things, you be Thank product All how for now? about edition limited And and are logistics inventory highlights levels? And inventory? you. will same you Good do the the the a of of year, the on from the How when have of of balance any means And the going the innovation? of to of innovation think any sit you secondly, first year? it the either

Joey Zwillinger

Yes.

basis logistics Dana. piece we year, that the So, point XXX to on the full set it cost for headwind

basis, points XXX way. to the on show why I part across of increase, relatively the be soon, of price the So but year basis to some of bit balance And you'll back impact, logistics kind in aggregate. see than points like goes just remember, whole points a forward say of basis up along basis in moving a that top probably that's piece, XXXX. it's on that on more loaded going that. year. XXXX, start full XXX And greater increase to cost The on as on the year that going price little it's have would obviously, frontloaded That's we're in XXX the a

we how that's think So that. about

comments what saw the costs. share in-transit in of really remarks, inventory, to that's in what I and terms the the really about made lot In there. of think extent that going prepared times we of A happened the freight I was that -- we're increased QX

are not us we right. That's did I we're in trends with had think more forward the we're XXXX. hand, -- put demand help why staying that being inventory really built And things QX. to meet on those the the we us, then within reality the continuing is

the think it's position have we we inventory right do So prudent to now.

Tim Brown

part in is franchises. and getting will for a a beyond story effort franchises new will technology first new the to Just Plant hit Leather great question real a here. prepared point kind of that be matrix us. across it's midsole impact of a both would will a real this add that product, a the and the remarks highlights land performance Leather, and excited The the the year about on that I’ll also Plant innovation multi-year the they towards we headline lifestyle of materials category suspect These will existing case and we leading

that performance no expect starting and we've these the different there really are demand of in that. materials running the you touched performance, to running to As really a on potential products by moments. excited the should community to see add in We're doing tailwinds us lot one's and a natural

exciting. patents products serve to across within different All different different to different really really six people customers, products increase emotional in allow starting with will about to that really a serve is to of territory merchandising materials expanding led years that's through digital us moments. So -- out that this color, build this, our portfolio, and five up excited ecosystem comfort, into different to journey product we're our

a then So exciting. And journey. is lastly, that's apparel really

is augment apparel And average history potential sort excited very, the franchises purchase we very to something footwear that the to increase to and We exciting continue most the working. as repeat rate, two. company strategy see that franchises the we're said, value, these roadmap for order build to about next lots on Like year in have the a the come. or in of of can I

Dana Telsey

you. Thank

Operator

Thank you.

comment or from comes Matthew JPMorgan. question from Boss next of Our the line

Your line is open.

Matthew Boss

Great. Thanks.

seeing points customers to you relative of on revenues, Maybe upside file basis the XXX versus the in brand So fourth you're through terms drivers from new quarter the to And to points base? customer what of could existing is the forecast? saw that walk your help just the you've from just this basis Mike embedded values acceleration larger to relative help then growth performance way your you order a XXXX, your XXX there revenue bridge of year?

Tim Brown

to those piece-by-piece. Yes, well, take try me let

the depending really into X% of saw the we carrying rest over X% start the million at last to So factors, some XXX from We really That's one, to the primarily guess, the that estimating I'll XXXX. the And increase, price I the range a we're easiest. combination, again, which upside raised XXX it impact, million QX to on timing elasticity. on two million. is of XXX

I that kind that So free hopefully, of unpack that think Matt. there,

terms it all it net drove had in felt was QX product first, had about what the We we In strongest the great pipeline really beat, QX. the starts we front what customer of year. that revenue in of

so that. positive to response And really

on the customer over a like terms to felt omni-channel in great like we win go the The piece really saw, kind led strong that those were. in to acquisition, the brand I in I AOV, to new went sorts down things. of some any the AOV, within the orders, terms and able combination an second all we what the drivers saw it breaking of in of of through want really quarter. top increase go of We of the like AOV business. in offering of omni-channel physical customers to deeper have within remarks, position it increase those upside in We you the is prepared is the And reference, We a prepared model contacts two digital like, were a of impact shift retail. quarter-by-quarter across the model us remarks. numbers the that full trend NCA trend. showed things referenced, Then wherever how have things and like repeat in my product like a And I quarter. Joey them for gives really played that worked out was sense good of rate on or terms year the in would in like don't

Matthew Boss

and into Great. this XX.X profitability. cadence forecast margin so, And is on built first year takes your any think low just here? versus a the puts that's walk any from gross we half And on for there more then to drivers target, the between about just Could material second for maybe you the the follow-up XXs out change if year? call of through medium-term

Tim Brown

of on I'll with So, second the the definitely No -- no that. XX%. start part change

both basis about we hit of Joey and improve confidence I target three the that's last talked points we're in spite improved XXX points definitely kind to years the basis and that give that continues And in medium script that XXX those term we've over of trying the in fact the think here. to target. that in XXXX, headwinds us by I

where that's feel coming together. So, we really about good

margin we as channel have well shift. terms the and both puts points inbound warehousing. being by In of and really outbound, the logistics the the on offset from takes That's headwind gross as XXX side, costs, basis

why gross So, bottom balance as topline similar one profit make then XXXX, very material between the we pricing to of continue line And product have story the what in to this felt mix well. saw benefit important it to shift. then improvement on we and the and the margin, this you improvements, in and was in the that. growth, gross more really products material and are as reason That's region well. make channel shift the offset new case, We'll

Matthew Boss

Great. Best of guys. luck,

Operator

you. Thank

from Our from Bob comes of the next comment or Guggenheim. Drbul question line

Your open. is line

Bob Drbul

highlight I out give I of, And if it one caught a China, apparel you just on think you shoes well Market you little us more then, is but a could you more the the doing And terms first lot performance? if is lifestyle wondering color you there, the color Is little for a anything the lot. growing are don't was there? study think talked Boston about I a that side. that and be curious doing just what know in for

encouraged some getting you examples that any markets of if of traction market us some in on that or by? an you're update the you're curious maybe could Just give other and

Tim Brown

Thanks, Bob.

of out year. in double-digit highest region seeing region. we say interesting is that sales. our brands of This right that struggle, a we in And up our within are country I'd previously really noted, call growth that China, now, surpassed lot frankly, high single on intentionally. So last a where put marketplace as lot an We impressive, industry

and still China, can really we're by the the as dominant that of the count we front on the of government reads and still U.S. correctly and brand the then what positioning cases. and building XXXX saying how we position I'll I very three the greener So of we're by accelerate team is in really consumption we part noise focus. shifting of the when I there. spikes a think, But across frankly scale, brand given store it's key our fantastic encouraged we're U.S. of process, COVID quickly. a consistent, that into to in smaller terms in trends, position there's in countries. our portfolio effectively other product, business on the on Look we've you in happening -- the a to think And consumers. region gone our And in it's geography move And And some as a know kind focused influencers things COVID pretty going what's of there through, great in think in

that add idiosyncratic And separate Boston, two now noisy see traffic to quite general in those mentioned resonance seen that more a for great impact our note near us environment that the killing point to. stuff. almost that's one around into Cambridge, a to marketplace. a great X.Xx Boston's we to we channel, We that there. still store no repeat a it's we road. incremental for the read future lift versus that which business because in and a great And in that But added We've omni-channel is still it product region. in just down really the remarks in through we're see retail there. spending So customers prepared and we've cannibalization, in the us you'll And single regions

core the we're the of model. that's doing. And that's what So

Kyle Khasigian

right. All

But for have prepared I remarks. the the get of okay a gone the time all are. lot through queue. couple if think to few we over, in year. more end Thanks a there's the long We went in you We're for flexibility. a questions minutes at

Operator

Thank you.

question from Altschwager from Baird. comes Mark the next comment line Our of or

open. is line Your

Mark Altschwager

Good Thanks. afternoon.

Just for on the store following up topic a moment.

anecdotes expected stores of of any through what color some in First, on in pace in you in your you. back for building openings you're market share broader the Thank performance seeing of the can And give then, awareness, on store opened us XXXX. XXXX? year you've the can half you context the the that brand

Tim Brown

Yes.

And get opens, open, specific pace idea model. going across the QX, of before we we can season. in we kind holiday talk to call we little more But try follow of if them there's your the terms if like to bit a on In the of it's be into Mark, jab can, to always pretty quarters. up QX, busy question get even QX like

obviously of think point, the of I just different the store brand and part terms and an interesting all In about question, the it's awareness second openings, surges. with Joey's to environment COVID

market-by-market certainly not a the U.S. hearing of in business, update total we're market trend, right as we at on look that kind now given how So but or a we're the quite performance question. new

ability who is that the repeat of XX% you that's meet of XX% the we procedures demand important of of investors model from the going them with more of strategy. than this through and channel keep will going one and the channels us to this overall spent so customers, customers just people to value back power time, really for and of saw with us up follow have the And keep the omni-channel just Joey back definitely together over why, for some in kind -- QX, referenced repeat came in and we how to kind across it's balance

Operator

Thank you.

KeyBanc question the Edward comes or Yruma next from Capital. comment from of line Our

line open. Your is

Edward Yruma

little margin with And you follow Hey, out. Tree iterative know able planned have I perspective, a learnings a new Thank expected a you. for it model mostly is the you're product, was a you of and a to up, down the the like Thanks any time tonight. Dasher guys would kind about discount of on as taking were X? we take rethink think as products. as any I know guess really as releasing you other you you I any just the From done there dig that first the a cost guys. to of product? have know, product transition, this think question guys about bit I changes? lightened are from with the initial up modeling,

Joey Zwillinger

I will answer much of question, answer better more Tim prepared will than he is and I say that much the would to second give half add.

were margin the the look the at higher it you Dashers that cost we X, continue Dasher terms we the Dashers X In owe if to of question, a at was, points price to launch And was. engineer.

the we products on products. kind cost the more savings current of heart referenced week of margin looking gross to them One over of great things it's on the the to time right? able the new was of Tim why every improvements Whether around, don’t improvements we or itself. the in question improvement in of his make product profile. of do products continue in margin you generations to We're that's XXXX and But always and a improve get be those product example,

Tim Brown

first this we've was franchise But could on us the and quite very out from that was Dasher through everything year addition to innovation reflectivity. momentum our able able improve really speaks new through and too for methods forget knew of here of making I a also to performance was just successful there growing capability really our with we the gate. it of advanced flow, of flow best category. product the performance There's to in we're traction bunch us learned we franchises. for that a And performance in you'll quickly real product think things see the the we're that

there win we and to one natural can that done to continue do no better experiences. with has products create really something believe We materials

from on So the desks for are just us here the in. to start for us. expect But again, see you should consistently that

Kyle Khasigian

All right.

more one quickly now. And us again, with the a we think try get this we to in I minutes going we'll one question your thanks, And We'll everybody queue, for answer if few have which try here. can to quickly. to flexibility. over

Operator

Capital of the Berenberg from is question Brian final McNamara Markets. Our line from

open. is line Your

Brian McNamara

in pricing year secondly, mix I'm And Thanks. X% your to Hey, terms curious squeezing talk if customers you curious in how pricing split XXXX of that guidance? XXXX? think should thank that you we here. of contemplated new With prior and could full in the me for your sales in how to to and was upgraded about I'm existing including between much X%, guidance,

Tim Brown

couple last price There was only a Brian. contemplated guidance no into And modest months gave. we in were the increase, pricing Yes. a we taken having

the been had that in we if have did shared know, the you So context in, call we would today. factored like

the of that news, Then macro we something breaking new of that's sort between guidance as about repeat terms as in definitely thinking new not we're saw think So of kind we out, really split forward. and and the especially about going environment. customers,

basis good back sort that seeing happen for to and we we So feel into sure. in acceleration both and in saw we're XXXX, XXXX. of have QX business, we QX -- going good what see line. feel top to excited we're on during the guidance the on the especially year overall year XXXX, And really year, about the then, full great a point this position full the is we're in the about and the for now, us, for year on definitely in what an We

Brian McNamara

Great. Thank you.

Operator

time. the no at I'm showing in queue additional questions this

Tim Brown

to continued but the our Hopefully, I'll business everyone the the to Maybe close XXXX questions. Thanks. full QX, our how Appreciate for year for thoughtful the that, conveyed of for growth Yes. and expectations and also underlying output, all this just both operator. XXXX. we've translated and strength financial

and brand these alluded lot have of for our We're the us to targets times, momentum. the execute and really coming optimism against also is to growth product against financial to deliver our for to to Tim and a it this think team I and goals. What's lineup I'll we eager start impact year our the point year. couple most exciting this So the that with a

again quarter. you with next So and talk to look guys forward thanks. Thanks

Operator

for you participating thank gentlemen, This in and conference. the Ladies program. today's concludes

You wonderful disconnect. may Everyone, day. now a have

Allbirds (BIRD) 24 Feb 222021 Q4 Earnings call transcript