Earnings call transcript Q2 2023

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Operator

Good afternoon, everyone and welcome to PLBY Group's Second Quarter 2023 Question-and-Answer Session. Hosting today's call are Ben Kohn, Chief Executive Officer, and Mark Crossman, Chief Financial Officer and Chief Operating Officer. [Operator instructions] While we wait for the queue to fill, we remind everyone that the information discussed today is qualified in its entirety by the Form 8-K that has been filed today by PLBY Group, Inc., which may be accessed on the SEC's website and PLBY Group's website. Today's call is also being webcast, and a replay will be posted on PLBY Group's Investor Relations website.

Please note that statements made during this call, including financial projections or other statements that are not historical in nature, may constitute forward-looking statements. do on future of at events they're and made and Group's the are obligation made, regarding any assumptions and we statements the these PLBY basis views time to Such update undertake statements. not business performance

cautionary subject set are could which Group's SEC, with forth to in risks, statement actual and forecasts, you cause not for historical This and any the refer more from made statements carefully PLBY its to to results Group's place including on results Do to statements those consider Forward-looking applies during should PLBY and reliance forward-looking call. differ forward-looking those risks filings statements. all information. this undue

not A call, Accepted may its During PLBY in prepared Form X-K GAAP of financial reconciliation Group refer accordance Group release measures. available is with with comparable financial the most Accounting directly non-GAAP earnings the Generally PLBY measures measures measures to Principles. this to in non-GAAP are Such today. non-GAAP filed

do you any the take we question? before first Ben, comments have

Ben Kohn

Thank and good operator, everyone. afternoon, you,

will going regurgitate we quarter, We open this with this format leans We right and the or release, sticking other be should feel what in we dialogue. our call this, longer me, also forward. to with it's half taking in Instead, and an doing update no will and so companies earnings of call our into Q&A prepared starting from better a an into release. anticipate go use see changed we it hold have remarks. conference more we time, open of a dialogue format a we earnings Also business instead leave

begin we'll our Operator? Q&A session. now that, With

Operator

you. Thank

with with of question from your comes Please proceed Our line Andrew question. first Uerkwitz the Jeffries.

Andrew Uerkwitz

format. Hey, I taking the question, and my new appreciate thanks for

questions. two Just

but great I It Honey curious that update value like to where you on press a asset? just according just on mentioned first macro some the Can call The is you Birdette. seems an facing stand on it earnings headwinds the of that? asset, reviewing the last think I'm you one, strategic particular release. give

Ben Kohn

I'll Andrew. pipe Thanks, that, take Mark, in. please and

internally, we lot of on in discontinued business been a We has moved time the have and been our to now limited That levers. financial ops have resources selling statement. focused spending

multiple have that offers for We business.

We exclusivity are a with under party.

At the putting time, financial the our together we on the Honey advisor market conclude process. for process, levers same evaluate working conditions, we and Honey based we M&A Birdette the are on will materials specifically and then to start Birdette when the timing market, for

Andrew Uerkwitz

helpful. creator switching two you. That's then to here. Thank it. over the And Got guess half platform, I questions

the is areas? secondarily, have to are and first you a in guys changes And AI us updates outcome. what adding other discovery The Can your features and made all on about rage. AI just and to thinking maybe seem other quarter the has been you that remind positive you. is very leveraging several roadmap then Thank the you platform? How

Ben Kohn

platform, Sure. to do we're that. data we updating us help constantly the are Look, and using

actually changing place was onboarding consumer had were and that biggest to the things we certain our does we that see in user quarter expand. undertook the during And the that process. So not the put change there or

credit but a moderation safe only company, also sure card For creators, example, we that tools, our the complies for companies. that create making our for platform, our not with

moderation out the actually with end is encouraging. data looked would completely in dating best in with What the and tools onboard process databases, way. and was so put right creator there, very but a there? sites onboarding as, some the ID a do etcetera, People actually we apply, then that to at reworked we of manual all so coupled creators how the for reworked etcetera? entire of were the Bumble, extremely state and And process the to users creators we checks historically, onboard right manual to the like are ones the for And back system whole AI the onboard

revenue what to we is you half, the came if of focus in bulk the the August. the at those allows continued at GMB and creator encouraging the to have increased that that July. marketing our earning the percentage platform in And creator versus this now XX creators, weekly our X,XXX individual platform our we look me X,XXX, I at of of coming the look really and what in of recruitment. creators end What us almost same earned about to contribute time do trends count say to concentration first many would from is happened, So by have top how of July in on over you for is at creators the is where when most July second time, The XX%. what's decreased

really, they've over by but points half, it's decrease percentage XX decreased. than half, they more Sorry,

so me the Other and continue made, live enhanced feature. our that we future, revenue to We including diverse, have health and the that forward. changes look greatly a product. is more speaks with live the rebuilt becoming platform more And we coming much a moving tells that a lot what There's our mix that in one-on-one of we more lot that to creators. is it earning

that that of we card before. versus have, the in recently a when put in? credit so a or increase something consumer few that cards credit fee a weeks did seen either entering system the we've We ago, is where are and others cards which in put changed entry did Xx consumers just number also also are does an and and We pay-per-minute credit a don't then a

say legacy up, started test I in system. is to lastly, we coming what would What's content the

from the the all the one company, do is this a fall. we former is profiles other into go So product, creator and that This There's we done hero changes. that platform? see we our company XX into not larger distinguished we'll integrate took users integrate how coming pieces into of And setting active lot which there's year Playmates that next highlights various that was might really, of more goes moving but we're into creator get as lot How throughout of the the the a up the we in Playboy that fall then lifestyle, a play into created system. of part those profiles, much does more the and into where the and are product. with

Andrew Uerkwitz

Thank helpful. Thank Ben. you. very it. Got That's you,

Operator

line question with Genuity. Our from next comes your proceed with Jason Canaccord of Please question. Tilchen the

Jason Tilchen

question. Great. Good for afternoon. taking the Thanks

creator a platform to on that's Thanks. please in view or on to target basis a a of and that being I to you level platform how for a that. investment level back the And update quarterly so? remind us even made get platform follow-up have creator second, can Going GMV break then us, the you after of that maybe

Ben Kohn

Yeah.

the of now mainly right level the OpEx. in is we're coming of creator investment platform So seeing out

in So were part with second last of was question? we it's roughly line what where your quarter. And the

Jason Tilchen

overall if target as looking to towards level point of have contributor sort starts a you're that of of a towards GMV be Sort positive you breakeven before profitability? a that

Ben Kohn

Yeah.

growth. we'd we able to have the continue I be of rate there but at, little we'll bit think yearend, get to by at to see a we're run if

million around $XX is think that GMV. $XX million number to I probably of

Lance Barton

Yeah.

that in we cash to positive previous flow $XX outlined continue and right million the now, calls. growth see So business for million the the we've to $XX turns of year the GMV,

as were human annualized second So use in we be we GMV of if quarter, during right of little creators It We our million. you capital. $XX wasn't reworking weekly a onboarding excess now, the good bit would took pause of process. just the a a

so now platform we And saw for is really at look turning to of the we marketing, moving that's very July when August, encouraging and the end and through of especially number us forward. applications continued the at acceleration the

Jason Tilchen

sort in when should savings that the timeline really And coming called the are specific in rest $X.X That's that sort be out talk versus the million were of out the already you of from cost of level just for those business? of you on of the QX press about just can where to expect the helpful. that we and coming taken release, out then

Mark Crossman

Yeah.

Mark, course the expense was costs. that and for out headcount cost systems seeing that I that the So that is, or we had between we're of original of a we say, $X.X first and basic that million talked a our mix supply lot we're original announced of our about would in using of the throughout chain the a company. coming the, this the lot The a this, coming quarter, headcount is operating lot over of the costs IT out

said, that'll of I quarters. to next the three the course over two out As play

Lance Barton

of any, of July, the $X.X that that million, quarter. in of second very although with the second we've little, specifically achieved quarter, the if there's in month And in some the

by of that the insurance years So item two of we're about savings ago so well multiple actually part item? line previously, And We've insurance, better example of were we, huge a dollars the and business are as a as talked big our we and of rebuilding millions a insurance. just line we in company. all repricing through today for of market than seen much was

Jason Tilchen

Really Great. a lot. Thanks helpful.

Operator

from Craig-Hallum. comes Fuhrman Alex Please Our instructions] [Operator with line with question. of the question proceed next your

Alex Fuhrman

related expanding that of have for talk of there what a in been the licensing able give Can Hey, to can terms then new business? your ongoing that any expenses talk Are business brand Playboy you the Wondering to to about XX% my e-commerce going of types guys. And to can just fee you're has or very taking might question. be sense you of maybe receive? much outsourcing items? Thanks to you the offset to if about the going growing us do licensee you historically? profitable business how

Mark Crossman

Yeah, this is Mark.

in losses place the losses it part turn ourselves. make that when heavy pretty in to infrastructure have was came from had the and to we we product of wanted profits. in, We business didn't those I the So to past

margins we margin. sub it, starting XX% very on So low had

bear. now we costs so to and And agreement, that right any it we don't we have licensed the out, have

much bottom straight So to line. the that XX% hits pretty

now our one million guarantees a I profitable it'll be perspective, year. day about So $X it's and minimum from think right started

grow about line not $XX to goal to XXX million the in years business, a overall and be the if to that's in us year is bottom to that just of the next So more. course three the one

Ben Kohn

figures the in. of Yeah, to still Alex, we seven losses store. related had quarter, Playboy.com, the just e-commerce I'll chime it's Ben. second In

our to costs And closed some the about because EBITDA, deal that those China weren't now so if related look for have we when it would second losses and EBITDA it, to been outsourced without the onetime in if those positive the related at and actually losses talk quarter we costs adjusted have JV. you being positive

merchandise Playboy yesterday, in the of for some by office partner actually going early the their very the forward. working was collaborations And they're actually and encouraged work, so on

Alex Fuhrman

very thank That's Okay, you both. helpful.

Operator

Our next Stifel. your line question Please proceed comes Jim of the with question. Duffy with from

Jim Duffy

thank Well, that typically Hey, coincidental you. Should Hi, the Hi, earnings. you tonight? follow expect Mark. guys, Ben. with we XX-Q

Mark Crossman

Yes, It should. should be forthcoming. you

Jim Duffy

then the Okay, your collection art next it fair great. comments, before Lovers both question great. is, expect And the considering And Okay, monetization yearend? of is to and say you then

Ben Kohn

Jim, What I sale Hey, can't see in and is you can on to we M&A it's I buyers Ben. multiple predict offers say processes. Look, Lovers.

and that we with and it to coupled We party finance moving that discontinued are, warranted team our are ops. team a exclusivity accounting where under decided with that

that discontinued continuing from quarter. And at revenue to when together reported, so add we both the look ops have you to our apples-to-apples and ops you

on the art road we multiple and or down it As either selling far the in auctions. as parties are collection, with one multiple in multiple conversations

of of year. the the will beyond art And the we are just before Some going happen end those collection.

with we mansion, etcetera, from have that think then And archives selling. from furniture some lot very our that's remnants I a of we the on plan still interesting. stuff there's

Jim Duffy

curious. Birdette brand the And you're dependence. then rebase? then that Helpful, thanks. a off do like I'm of Birdette, to Is Australia? within it be it Honey promotional Australia, of could with Australia outside How growing long seems respect And before the think you can ripping business

Mark Crossman

brand the in both decline, I the seeing the bones Europe. and declining that it, the no is so outpacing decline Australia Yes, Europe. we're business the But is about US in in US and make is is

an there saw things. but two necessarily Now we kind not is are product, Day regions, is this and when positive weekend. essentials what and really pushing have three had extremely consumer see and day sale sale, towards shelves we The sales right of Memorial we services actually both now essentials flies seven comp off saw all we just a the so in we a high when stuff we're over

So tremendously sales. from you May comped then hangover course up typical have and in of the the big June

down traffic think. the and Day moves year, days whether or now during we're XXX push we'll push with up is on So not. point, be what we're I month. out. we're think we not and sale entire September. the on sale. growth. the to conversion, last there, run were year, is September, It and on was coming but in, to We'll right really sale And And We'll towards conversion is almost we're seeing for that's revenue this about on sale up be your towards I a Labor goal, profitability year

Operator

comes [Operator instructions] Our J.P. MKM. Wollam Roth from next Please line proceed question the your question. with with of

J.P. Wollam

of looks out Hi, there's guys. a achieve got to start my just the some is like I'm of question. geopolitical licensing if that? into terms I curious of call the first you joint be situation. taking able maybe about to you been made to changes the kind JV and when appreciate to going If could you relative in and/or venture, of any business the we what kind just

Ben Kohn

we our call It's Ben had JP. Thanks, Kohn. last partners just night. No, a with

I plan flagship business not that business the and changed. out with China think process these T-Mall, and control back something control and controlling business the that on them really and of the that stores the consumer. year, Douyin and was platforms, sale in have the create some crafted create that to the or and It's models but really back the with obviously manufacturing, take we last set so could take process, sale wanted platforms the we inventory

GC just a were there and in issues to really ago and myself or China relate few issues. weeks Chris Riley specific macroeconomic The

very, moving going leaving than money was to wires of at banks out are Hong the just luxury on the top now, historically, money because they rejecting laborious economy good in China very the It's sometimes even consumer. times it's it can more ground that, a there much of is are outside where poor So process challenging. then China, Kong out of mainland, be not right the on moving and

that And so things, plan ground has be the with timing the not overall what's business opportunity on on, just there. it's going the the and what of have to changed, flexible you

it's rebound post happen. that right people years there over I the China, not economic is it's expecting been others, reported think consumer they us, did three And not the were wary of now. by the think had, that, lockdowns in I

the with we're us our as it so back take And focused what and that's helps extent actually stores to some partners to talking and we're of some negotiating on.

J.P. Wollam

I there appreciate Great. just Really the follow and then one follow if could more, up.

big kind parts of that of but curious, ops, rev of quarter terms obviously P&L we moving kind to discontinued a then move the licensing In of just margin margin, have the a lot in going lot gross about should high this of Or and now with somewhat mislead contributor, kind anything gross out would also margin of that of base just kind us look? QX? Birdette Honey is a to business is point the as of indicative how there XQ's that of forward

Mark Crossman

the The down look margin in is tick that's businesses. the Mark. would I is a you'll did a pickup a that because one tick we have thing see we up that business from It commission that from Yeah, did true. licensing sorry, bit reversal high there. this a, had little of little a Yeah, probably bit at

start will so together, come to the two think about will be a So you should your I net if the licensing same. lift to HB point, But you little roughly see bit. down and they

J.P. Wollam

helpful. and of help luck. Got Appreciate it. Very best the

Operator

proceed with with question next Greg Chardan. Pendy the line your from Our of comes question. Please

Greg Pendy

for thanks question. guys, taking my Hey

the dependence on top kind of then, us Center performers XX Just the you I revenue of [ph]. gave earlier think

many color are on performers the how to wondering, could those of how kind about you of kind and platform exclusive of thinking share kind forward? of you're that going any Just dependence

Mark Crossman

Sure. Thanks, Greg.

have So we exclusivity any with don't creators. of our

I monetize. they free audience once to on don't creators our I and those They leave economy, us are have to with actually monetize to build. of platforms consistent the revenues tends say, they to be creators want on Our think that largely, been creator platform, where platforms. audience to successful a with the has able to want would to on and whatever quarter, creator to right. actually creators again, during do I want an that What and with most other see platform the that starting move and to the stay We've other over creator continue wanted that's

months come in you are revenue our When point, to of company a I from is, whole, weekly GMV XX a that they added look if have so now concentration the many earning we've is continues basis, I might that annualize Today, our you platform, issues. creators percentage, were have when look is diversification at and today, where not we concentration that at because what encouraging number contribute few now a started, down risk, million what's $XX and other the top ago versus a to really when on me you that. creators where excess as first so don't in as your

And so on a platform was daily if than is of the or more something. much creators leads or vacation sick one on growth what consistent it to the historically

variability today. seen or You what you're more seeing have hourly could daily than

I'm something And beginning of we've is on, encouraged. health made this starting really middle to platform a the also focused change out we the We allows really far capital months encouraged to against of spent by very really Again, making human internally, It TAC haven't the this. results. to so on now marketing. building dollar me in that was of so this us and reprioritize on the July. been focus platform in which that what and it is It's and the

smart have would I say more a about Playboy recruitment, the what is the The we platform customers up allows and versus set very think very but perspective. through to creator given the it creators, a from marketing lifestyle labor-intensive individual tech in of ways. come were just internally how All us

Greg Pendy

Thanks lot. That's helpful. a very

Operator

no call further in for remarks. questions back the closing are There hand like the queue. to Ben to I'd Kohn

Ben Kohn

and on next you, our look appreciate you. quarterly I to you joining forward everyone call. we Thank talking to operator. earnings Thank

Operator

teleconference. Ladies and participation. gentlemen, this does for you Thank conclude today's your

this day. your a and have disconnect may wonderful lines You at time

PLBY (PLBY) 9 Aug 232023 Q2 Earnings call transcript