BBBY - Earnings call transcript Q1 2020 | 20230930-DK-Butterfly-1, Inc.

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Operator

Welcome to the Bed Bath & Beyond's Fiscal 2020 First Quarter Earnings Conference Call. My name is Hilda, and I will be your operator for today. [Operator Instructions] Please note that this conference is being recorded. I will now turn the call over to Ms. Janet Barth. Ms. begin. may you Barth,

Janet Barth

good earnings Welcome call. and XXXX our first quarter afternoon, you, to everyone. fiscal Thank

us any We with different with you still today you are working from locations. remotely Please today's delays during minor and connecting if call. experience bear

with of call President is Hartmann; Officer Chief buybuy Financial BABY, today Tritton; Chief Operating and and Gustavo Merchandising Harmon Hartsig. and John Treasurer, me Arnal; Mark Stores, President Officer Chief the On CEO, Officer and Joe of President and

and with statements, the remarks, may we presentation earnings Investor opening uncertainties, detail exhibits Form remind found the XX-K. Annual filings including company's SEC at risks our revise that our begin as forward-looking me statements of no including or we in filed long-term cause such refer most we any and X-K differ to today. this company refer recent All internal the quarter Before www.bedbathandbeyond.com say the or models subject materially periodic call the uncertainties first the outlook statements. could obligation contain our regarding ahead to our section on undertakes our to Report results our these during Factors for The more website release you let Risk references Form Relations actual and Please and conference performance, our what statements on risks we that of to in fiscal to can to forward-looking are our to XXXX and just section slide slides about and be call call. This from update objectives.

measure of measures the in discuss amounts accordance generally today Additionally, to are accounting amounts in directly are exclude accepted with the that included effect that adjustments comparable most or that the information contains principles. certain prepared subject will financial have excluding we

our comparable in measures as Mark. call website to accordance earnings now release the to with Form to the on pleasure table to our filed the presented is available our please turn an X-K refer exhibit It For to a in and reconciliation most today. GAAP, over included

Mark Tritton

Thank you, Janet. afternoon Good everyone.

said, I'm excited As a to call. some be from speaking remote here happy our welcome with leadership location. you like to all of you tonight to hear to team, and Janet Janet I'd new for our as from described. we're you

presentation strategic focus the business, Our re-openings. update in the our our to store to includes including and near-term today agenda for COVID-XX the on an response pandemic, actions approach of

focus an and do perspective. review from quarter results. the on Next, strategic our our update give Gustavo first of Joe financial operations us a will John will commercial Then will same the

We will take questions. then

aware American by the North The our managing to one and No consequences, make measure. to for responses proud of action. let of customers, understand easy, XXXX own and could scale global extraordinary safe. have our various We the and economy and swiftly our cash associates our are their capital assess we I'm our impact the $XXX decisions decisive and medium- our operating impacted ended this new teams with optimizing our some the further would massive came our has and keep implemented control anticipated asset-based communities half have our investment and strengthened business. and controlling position from risks, first But of three-year after our hyper-focused a amount These are allocation $X.X this people not any strong to and liquidity capital especially how Last the on we quarter, monthly to of maintain including pandemic reduction I succeeded people, improve ensuring believe We quarter postponing been dividends. a together of plans cash debt to burn of and one alone quarterly remain flow our million the Throughout billion. we the close, right our very for the those financial of on we tight share of credit business, have cash liquidity the revolving consequences, furlough. in for suspending in month, generation. repurchase, investments decisions including been short-, health actions flexibility, by actions long-term take costs, on expenses, inventory, a quarter the facility.

to times. about uncertain We position are manage through confident ability and financial our their these

in have not focus we difficult this strategic through rebuild home managing on been lost the authority environment, have While we to our space. our imperative

of progress strong several make elements assets. even accelerated to transformation continue We our and

Merchandising and our Stores, Officer, President and Decorist. John onboarded Cindy quarter, who President Chief the Officer spent joined Hartsig, his Importantly, Stores the served Digital to joined role months supported Masood, meeting and small Joe many May our Chief President was Digital next level. was the to These Gregg in Officer the Chief no previously and our Gustavo and during Arlene have I we Hartmann, five of and Officer. of Treasurer; character Officer Financial Chief Board, and Davis, as Hong, Melnick, by and Harmon Rafeh Officer in right skills, BABY; Chief Chief five Legal new which Secretary; buybuy to Officer and new senior Operating Brand who new candidates March; Officer; feat: business take appointed of Chief experience Chief Corporate who Arnal, Interim leaders our

all of retail I'm accelerate pace to delighted experts have Our to is them the complete. of experienced transformation. finally diverse team on board highly

stores and U.S. and BABY and our health and of Now XX from of outset our team, retail buybuy the Values across the Face of the on Canada, excluding vast stores. prioritized COVID-XX closed we've March banner majority most crisis, customers Harmon the communities. We the safety

an a was important customer It omni-always our and and of remain us This the opportunity a a As and was in preferences support the decline for result, pivot XX% net new changing we of our majority a act leading critical approach. nearly locations closed model quarter, XX% to to to during sales. needed moment, quickly. to

store with stores into dramatic fleet own of our we to in closed, unlock vast nearly Now pre-planned store fulfillment which our our shift Buy-Online-Pick-Up-In-Store the of one on for buybuy the demand the centers, rollout digital of and Building and capability, capacity of Curbside regional our handle accelerated is April, majority network fulfillment fulfillment BABY channels total converted we key BOPIS our to our realigned of services doubling highlights inventory. our in banner. the and or quarter, especially our Pickup offered the XX%

XX% the new Bed our but we digital talk Net powered channels. saw acquisition us reopen grew current digital impacted. new to May. shop was of These we net Joe steps this were us the time public. of XX% offering nearly channels were quarter a engage and As restart represented May, sales store key strong who Digital of confidently. to the way, By allowed our relevant. of through our the were plan were locations. the and was over we growth we to and and and with say customer including locations quarter closed By public, to in Bath total us and of growth and & we John frequent plans ordering more in sales a our it the merchandising sales. store in few May, pivoted to operations at measured XX% to customers website will than highlight capabilities at April of can still late favorably therefore, stores in about few ended stores to to Nearly online XX% minutes, and by nearly also online were the also in including Curbside them from how began new of first more customers will launch new Pickup was for our discuss customers through for our minutes, our during we changer XXX% more completely with our the Beyond. that In a month updates as ensure in game BOPIS customers, this us a orders late growth marketing serve the safety digital two-thirds our help taking placed

past retail and local market with of the pace line accelerated regulations, changing in wider state data, have the During store month, landscape. the re-openings and

implement Our while business approach, dedicated customers. rebuilding welcoming team helping for services us resume to for and and flexibility customers. back thank a strong our introducing our we market-by-market us invest safely in new allowed operations I our financial want loyal our to

of for our our teams safe actions how proud are took customers. We to deliver and they our adapted keep decisive and and people quickly

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have As product, price, people. and in previously grounded place, key pillars: we promise, framework stated, five our strategic

Joe. price, product, and the about place from more hear pillars John today You'll and

family it our To safe role durable to our with reestablish we've Bath to today more this make is greater takes at home business believe destination to their essential. delivering and supporting is model making feel of is even our efficiency Northstar easy to effectiveness, our it feel our is achieve With mission when charting Beyond driven everything mission purpose drive customers start, defining home. To at We our the relevant guide, as for company. preferred actions. and our Bed role, at to these consistently families teams a and home on new customers, more embraced This be commitment growth. and our this that home for ever redefined operating guides all an balanced, important our course a five is authority & being by to by modernize than the place pillars easy we purpose, home. and a reconstruct

core strong to ongoing to we're actions restructuring also a foundations This as our program. house improving of business. investing to essential represents addition COVID moment focused the plumbing on for us an is the our the drive also of rebuilding opportunity of In strategies, and pillar part proficiencies, that

among next and $XXX focus growth. related project channels. Bed other the near-term of our reduce performance shift aggregate We mostly pressures digital address Bath these & our sell have store accelerate on to other investments believe supply with drive savings drive transformation pandemic. related our from efforts also alignment to reductions. include, to accelerated costs. things, and stores our stores Furthermore, between Beyond under goods generate We the further and chain to benefit close and margin cost optimization digital annualized making structure approximately to the These the to of two additional future million XXX from plan substantial related transformation gross in we the cost onetime to to over current actions our We're million, expense excluding network will of years $XXX SG&A

to concepts. an As committed we business of previously we outlined, review our ongoing are non-core

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Gustavo Arnal

strengthen two analysts Thank months and Mark, our good the job over with around everyone. community been I and pandemic have in more and Bed afternoon, look look two business delighted & been model time the weeks on to and which help now, you, forward company. our join Bath come. investor team to I I've to feels Beyond's to months years. sustainable continuing like interactions forward a for

relevance opportunity Since the in challenge We has to I our been attracted brand, have in of the on I an as we intensively manage customers. restore iconic crisis. company and the minds was of the by team a homes business, closed. May, our joined our so predominantly to were stores transforming liquidity This achieved the we the the focused during digital and driving operations of cost majority company temporarily interventions as COVID pivoted ensuring was and while

me some Let quarter. our provide first highlights fiscal on

temporary actions important in to March payroll, had to control our monthly of expenses April, that such of response to prioritizing Keep and stores it's quarter critical mind First, and the announced liquidity the span pandemic: and maintain most took quickly, to-date time on some as closure XX, other cash the burn. situation, March, costs. by operational already that the COVID-XX to rent we we note paid interventions this company three our May. In acted months

conjunction in store in March. So effect cash were late into the with announcement management closure strategies

furloughed We corporate canceled approximately our started the of proactively we payment and We maintenance we with and and orders. deferred planned in stores, of the savings extended services, expenditures. our portion majority to as million vendors purchase associates. store terms as travel, related associates $XXX reduced areas Specifically, rent. renegotiating for immediately such manage business and as capital spending goods, associated advertising, in of expenses inventory and discretionary with well a And

additional our million if which billion and our new burn and by of a needed. June, bolster substantial liquidity facility, As lower provides with strong in we'll May. $X.X a And we cash liquidity cash lending monthly investment end $XXX result, a asset-based successfully recorded balance

Our were shift of With toward months. mainly vast product during impacted a substantial by of most impacted sales closed the was having our sales margin channel our of the during resulting business gross channels. as quarter. majorities from We net and by operated stores digital digital the mix, these this,

and cash cash coming down cash elected In draw $XXX monthly in a our revolving million facility, We off available the unsecured at position, balance our which billion cash enhance look investments. the now strong of March, enter $X.X we a year-end quarter Let's burn. very in our from to credit position.

I As month. earlier, during outflow significant have cash first we said the

our move carefully reduce April, and cash outflows we our to strategies into cash implemented inflows manage we management and burn. As

This ABL cash liquidity As neutral, the $X.X than actions a total facility investments. plans implement we we a is under the billion were insurance have move and into focus financial May, of we with $X.X the after leaving available plan. the provides that of quarter-end and great If further important driving us in funds. entered billion liquidity as and available we cash more balance in consider company's strategic closed, flexibility we new we into transformation under reopening our on store quarter

share of operational prior to basis, the loss a period. of share GAAP we to turn I'll results in Now year diluted a diluted compared loss per the quarter. a the net reported $X.XX per net of $X.XX On

related temporary from rollout On a certain store non-GAAP quarter $X.X year-on-year a the of net share to store due closures. quarter our XX% year, net our March, also level basis, first Market the World channels during to prior June, reopening will Consistent a primarily starting our XX%, represent business. channels stores channels not remainder Plus each as net net of items to in our mostly and quarter, to to directional and and our on share across supported and experienced We our a explosive unfavorable Pickup but Bath were basis initiated results than from names. month Mark Harmon better BABY, months increased the two sales by growth diluted more offers, In special Net quarterly our reported the to digital experienced results a impairments we decrease phased approximately basis, declined from buybuy performance be the strong Our These across same with each $X.XX. billion, last earlier. the of sales while quarter approximately XX% Bed On stores. these first non-cash up Then sales were as XX%. non-GAAP up XXXX. trade our growth XXXX. sales digital diluted per store includes digital in service XXX% digital and only assets strong loss our loss compared approach quarter-end, for with we from March subsequent per Cost $X.XX impact after an of net sales in expansion for of month net by Curbside with of about was of the disclosures, and of May, our BOPIS discussed April Beyond, compared

while our stores response. it we're all days, customer is open the As are of with early nearly and of pleased today, still

For of June, month sales only overall decreased X%. the net

from remained this sales month. XX%, XX%, growth gradual during same the During our the the of strong, digital reflecting from period, with of net net excess sales in while declined store approximately channels year-over-year reopening course

Moving XX.X% due decline to in a substantial to in The gross unfavorable gross XX.X% our of sales basis the margin; net and XXX sales as primarily channel to year. product with to last on impact was channels. shift was digital connection point mix compared margin

For direct-to-customer penetration represented in of shipping sales, some period. incremental digital from two-thirds nearly The represented mix our context, expense of quarterly the the net the nearly sales prior compared channels channel one-fifth bulk to year of our impact. total

COVID margin In mix. addition, items pressure and product higher sales contributed essential of lower to

furlough, Act reduction lower fiscal that the restructuring and the expense such Moving benefits program. to of from the the response $XXX end associated the to interventions SG&A, taken credit the were at XXXX, the for initiated or cost compared from discretionary spending million in CARES corporate and reflect as quarter year. decline prior impact declined including to adjusted COVID-XX, XX% SG&A This actions

prior in from year on SG&A period, to sales fixed was percentage few impact the net at modest quarter a half actions or early were of pace balance of versus of orders. billion the product sales purchase A additional increase year-end, inventories due cost, of the a net XX.X% net in significantly prior year. first to increased XX.X% items; cancel about quarter that $X.X to we As reduce took the retail a sales, costs sheet as

our In expenditures programs our capital allocation our our return capital uncertainty committed part including we're repurchase replenishment and a not remains the to when meet with we'll approximately Moving management changing XX% as volatile. for expense dividend suspended to $XX regard over as The such CapEx, warehouse and have the quarterly technology to of share strategies reminder, to and mid-to-long-term needs advanced of response. capital the during to related this XXXX. the COVID-XX pandemic, as is financial impact and projects, to The our evolving million, period. related were to appropriate. a logic we of allocation strategies, situation and providing capabilities, COVID customer the company remains reevaluate program the Due still continued guidance inventory

We relation supply are closely continuing in associates, to situation customers, to our chain. business monitor the and partners,

Given well to the our positioned we're strength times. these through believe manage balance we uncertain of sheet,

some want earlier. Before to I of closing, stated what Mark reiterate

liquidity have on to and strong to will continue generation. we a management, First, improve drive cash focus continue to actions flow

address related to our transformation. we will excluded Bed between of close the And store and deliberate stores the our cost. ongoing of benefits part XXX focus Bath & optimization channels. these pressures project, million, Second, SG&A one-time goods stores, and other generate savings as aggregate approximately future reductions. total shift to supply Beyond expense drive help continue digital margin our years, from related gross chain as to two of believe network of about to of program reduce $XXX we'll to we're XX% annualized over We actions This cost part $XXX representing on and million sales next substantial pursuing of the plan will actions restructuring

to Third, our is progress that digital in over transformation operations. drive I will investments turn John, further and update accelerate an our within making we're transformation on now growth. the for our to call

John Hartmann

most ago, afternoon, you, quickly up & like and less participate two Bath with everyone. under my the I a months speed to to earnings and these I first Bed I'm than part company brand. happy unusual to the Gustavo, joined to rather major vision good of come in colleagues, was and Thank have broader Beyond. call my little be for together speaking great join the future circumstances. & me about Beyond, I'll Today, I'm of for transform this excited will three the Bed be Mark's team that attraction topics. Bath

how comments pandemic in pivoted COVID a our of the the about First, operations and and powered face our of the store growth channels. few closures digital

provide supply Optimization a global chain. Store third, few about was of will And end-to-end an that on Project Second, earlier. update redesign our mentioned the our details I more Network

changing the stores, COVID the March late took As our meet the we customers. majority in evolved enforced our the closure to operations pandemic hold of temporary rapidly of of needs

Thanks than how shows inventory that almost the us to remained is services locally the converted To and deliver our the accelerated resources Pickup assign or Plus open to stores in orders XX% offerings teams, Curbside Cost quarter, nearly BOPIS web the customers. ship doubled Curbside digital to more stores. hours. our Market BABY our to and capacity the to that and been investment XX% the Bath the As launch pickup and the across across beyond important regional and has orders end of to total fulfillment vast the increasingly business the & in response on demand the these in to This less, expanded of favorable, our closed our buybuy Pickup mid-April, our had Beyond channels, homes. efforts two U.S. public. us stores Canada Harmon ever in than their products Stores to into we stores of Customer online BOPIS people available remain contactless about Bed of our strategic less expanding closed, average, increased of extraordinary By and leverage we to and quickly, which country centers, with deliver enabled for World support to needed rapidly starting our days make the across and and digital which essential stores our or to fulfillment two orders within allowed quarter. during us

In stores store the close optimize COVID footprint. locations, these but reshape stores, and our our this omni-fulfillment are we we'll our expanding pivot As capabilities. and to not to this believe we take services to we can simply reopen, truly just moment, and continue to opportunity optimize

our believe channel omni-fulfillment is our store to asset continue transform We us with physical an for digital-first especially in into Curbside. capabilities we that BOPIS new a as company, and

initial As by the way, under that our work completed company building Project the gets Network was Optimization are off we last year.

Our approach includes to growth. lagged market the both store Bed a sales of believe market market stores our local of that demand. modeling More opportunity, that & current of not banner digital in and physical much deeper and align shows specifically, sales and Bath addresses analysis XX% footprint Beyond to geo-analytical the individual Recent data. has our does market we about only fully the the XX% store

right supports Our platform, to to in and growth. appropriate a the reduces a in with digital-first locations, redundant that store way serve immediate number customer stores goal and right of such the accelerate is network size our stores demand

We stabilize will store drive parallel, and look lease profitable improvements while banners, deliver lean into Bed store results. portfolio accelerate our to Bath other over both expirations, and designed several years, the and of due restructure number & leverage at business cost help Beyond long-term coming productivity significant the a closures in to our retail next

country across the two years. closures previously forward As about to store the said, next over plan XXX we move with

line EBITDA impact While our is we to upside. closures top significant the there expect unfavorably

the we locations, efforts to profitably. capabilities the real-estate economics strategically format enable investments portfolio, and drive grow a also productivity we operational test In goal to restructure improvement will share, we store and future, new to results. market cost As with business sustain in continuous will

is reduce end-to-end capabilities on business, fulfillment deliver of our our assortment, aspects infrastructure all store experience importing fulfillment, touches The short, of expand brands, our savings, to network The ordering digital optimize capital enhance support further acceleration all-in is to Next support and redesign drive supply intended of improvements supply omni-channel facilitate and cost of significantly in for which sourcing for our lead-time including The improve enhancements. and vendors, the our initiative, growth customer roadmap centers chain global the to capabilities in redesign technology update our and routing. product and I'll program experience direct requirements, growth. eXe stores drive and efficiency. support our provide an working a own new omni-channel or chain cost our customers' multi-year expected a enhanced redesign will and to

As part of the our that inventory points to store reduce requirements. program, of optimize we our pool and replenish will realign numbers which network in-stock inventory, our store plan

locations. deliveries by efficiencies to also redesign years, Overall, millions, deliver accounts fulfillment redesign work. purchase greater savings, times. bulk annual we teams drive the the support creating area the and to plan significant reduction and operating initiative, plan will day from the also cost significant of our our future It chain. to of savings reduce, drastically will Through deliver greater to vendor to more the DCs serve targeted three and love. company's while are technology this expect efficiencies transformation supply model we and is we Technology our in eXe over We number the efforts. to will the further optimize orders our which payable across modern next store a create, routing, lead one inventory vendors within a efficient the And our faster stack driving network to increase

our basis, We forward enhance We technology are capabilities. this, sharing to and the cloud, on customers led baby on Canadian Pickup, and diapers, sales goes pandemic. to operational and expedite performance our safety of for a compared online data most to creating On exponentially the digital our items on Even have total up retailer has XX% BABY sleepwear. the approximately first in our an XX% our and the fight a U.S. grew the stores very will and pleased food, In boosting with rapidly just to our excelled BOPIS buybuy XX% and quarter, on, customer shifted people our formula, buybuy marketing was commitment when highlight sales for the buybuy almost during about our these progress reflect the providing our families. business last buybuy business heart were migration stores of tremendous, look initiatives the BABY's items brief digital the all The total the remain support pilot of ensuring as been standup essential quarter. our computing, care banner to our equipment, Early Curbside of like in our need items to more of sales and open, with stores of stock A which needs. BABY in its their We currently planning the company company's positive to and directional during the spirit, our quickly digital key the growing through buybuy to and for they we essential demands, a our future. company's business, how approach close will in made of toddler wipes, baby was online with content and to BABY performance food demand playroom of year. experience, customer of to changing open increased BABY customers. company's response the of marketing as quarter. U.S. deemed I adjusted the and and net and customer teams update the in remained essential roughly shown

baby program questions support to service registry during consultation ask to to enhanced challenging a expecting expert parents times, new advisor. example, phone baby our registry customers enabling these For including we an

in mission their We need Squad, partnership design brand to turn I for they parents, provide can Decorist. will launched everything one-stop reminded call nursery in also sister shop services important and our times, a an innovative baby, inspiration With to Design be. we journey their our for difficult prepare and confidently how these during over to are should Joe. role now the with

Joe Hartsig

The short responded and It much & I'm John, I so been to for start area. opportunity update in I've a an at been customers you, say, then quarter within some time. and me the of hello, And join an has time. transformation greater. incredibly Today, March, it merchandising arriving of everyone. with meeting needs commercial to have highlights certainly challenging by I'll perspective, Beyond. Since our Thank a this during teams on customers to time our in from our make quickly to in how Bath Bed our of learned feel the have let encouraged never amount has exciting progress the provide home easy really

and we As costs. We incredibly the March, agile product control. into vendors converted stores cancelled to store demand. with increase stores, modified purchase regional and product fulfillment our became inventories partner merchandising working further products stores fulfillment warehouses expense as We marketing quickly in approach these impact as became purchases of apparent and needs orders redirected pivoted supply future reduce closures optimize centers support customer to starting And with as manage and and and our we closed demand high to to increased as merchandising to changing, digital from as were capital. well to expedite web of temporary well

canceling that our or and relevant. engage minimizing online were marketing marketing customers better stay on our only programs, to print communications adapted We focused driving plans on brand events campaigns adjusted traffic. and our also in-store We

new traffic online. investments items to We created paid to flow reporting to our capitalize on Turning including to to built We online place. digital sheltered efforts business, as and customers our stock. collective we attention our reach spend focused marketing increased websites, our keep digital on teams, drive in inventory in demand and shifted affiliate our the daily strong top increased social, working to search, new in customers marketing

our well refreshed and as aligned with new website also our We customer branding. look, voice as more insights, feel modern to with a

customer key from our incorporated to we behavior metrics learnings merchandising optimize messaging. Finally, site and Pinterest detailed partners through like of

greater a quarter, than had properties, During digital million XXX increase our first across the prior which than more period. is visits XX% we the over year

online, digital XX% & our strong channels, including through online We demand acquisition also an nearly to mobile compared of placed downloads were & also to had Beyond that XX% a XXX% stores, of customer new over strong our ordering year. completely revenue was across which app up orders with our earlier, our to to of channel, and Play Google excess mentioned is by contributed Mark customers Bath last new Bed Beyond. Apple XXX,XXX Bed mobile new as And from which Bath

engagement the leverage, develop first trends Beyond growth the explosive us marketing, important fulfillment, including stronger quarter. our agile merchandising and services Pickup expansion to that channels Bath quarter, digital rollout the derived show digital our overall tactics. advanced help for across during Bed to in more data from higher and analyze in efforts saw engagement and behavior peers rates as These along & with of BOPIS online support than Curbside we These our Third-party insights purchasers. are further conversion customer first-time

high. exciting of is ratings described services earlier, our Curbside extremely BOPIS our As pickup John for are and and omni-channel these adoption customer online customer service

We ways. shop have opportunity new our customers created even it and a make with easier in safe great to us new to for

service with from check-in launched customers Curbside receive their new from phone. We cars, mobile experience a place and have app this in to store BOPIS last that enhanced allows month orders, orders all their already the

transaction addition, product perspective, broader to that are stores Pay the Bath simplify From offering In online trends during & own process. we the our product quarter first to trends. market similar in Beyond Bed now saw category was business Apple a

strong XXX% in customer first throughout spiked & Bath inwards categories months, of sheets, with vacuums Curbside and due product driven of pillows significantly for as and Sales baby home, acceleration to grew and and basic In March behavior sales Food and last strength Baby of beginning The and performed on Cleaning which the three was more with market Bed the quarter home. broader essentials. and the the another than category filtration performing systems Prep of more Beyond, kitchen across online of Care throughout strong food category was coinciding Home water stockpiling For in customer’s trends electric, online sales April, the Kitchen each top prepared at including we XXX% saw to providing Pickup. our of turned in quarter, peaking grow, in outperforming May, comforters. BOPIS more the Toddler the April to our as well overall enjoyment to comfort online bedding up essentials, category by year. compared demand and

spaces store late enjoyed cooking mixers when are excitement the in seeing team lives, like as that continue have summer purpose; the at customers in As re-openings doing living customers store the of very in support sales and our feel surge in again. to excited we time looking invest work seen in surge from of also at in their early we're gathered migrate for homes June, the home to of across the merchandising our At May easy our customers as a their on Kitchen it our home. the electrics have months. outdoor and board XX% the center shop families about categories We're total we become our customer-driven inside who commenced we're to of home. make house the the outside a new in to

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which Bed our including curating a eliminate, in way customer-driven starting expanding Some market. we brand Bath which key categories, we own our products in should include Kitchen developing differentiation and and the initiatives should of we which carry, assortment, enhance new portfolio, & products and under should our add, to

forecasting marketplace; to brands through own and competitiveness plan across logic, our while of improved a and vision aim omni-always establishing improvements so and a a terms turns, for multiple both increase to from and products. in our we year of in customer in-stocks of product amount through quality can cost we experience stores Next Negotiating right the preference improved replenishment suppliers in and placing on the and levels and digital right launch categories higher stores, our our brands sites. the in fiscal inventory new exciting in ensuring and XXXX, create centralized number inventory

retailers competitive is and have specialty be tools ensure spending testing Key opportunity, and customer ability our end-to-end known for less by pricing of right frequency, retain modernizing and market driver as well and new for a price Bed building evolving loyalty for have to leveraging to well the a retailer price by and compelling points long-term and true our customers. value to as Additionally, this a our pillar assortment & ensuring and we loyalty. optimizing therefore profitability. The is clear we areas chips goal and as as processes, gain more valuable representation to with better our pricing of margin dynamic localized Beyond of include, engage better Bath of programs our our promotional and mass promotional key engine compete everyday focus pricing offering online new to values. as Re-curating

for we a and our product platform sharing our our We're creating planning with a about forward Lastly, progress stronger merchandising look will and this to way integrated plan, the compelling our place strategic together, new marketing for our have to for launched an consistent process customers experience digital excited review. and in-line and promise, create intend. omni-channel a with a pillars and stores price tie that and

transforming momentum future, have focused and digital business. store for plans our on reopening very while we we the busy capitalizing we're the in So our remain on

this transition can we're our our registry, home and Hold the overhauled greater and the program customers. and Pack college about services, we signature ease authority Overall, much value-oriented the space within of we make college that elevated to have often an four affordability. ease them made to we With back As our with progress affordable life brings with very college and and easier. & options convenience encouraged to our which example, help year, stressful combined experiences rebuild

the are value our are transformational online modernizing our and early as new confident work approach are assortment that omni-channel for better lens, stages through this we we and such and the in our our communicating right experiences initiatives, in the of refining While strengthening elevating store Merchandising, strategies. customer-centric

I'll the and teams direction are with change to leaning new Mark. excitement. this the call over into embracing now Our turn back strategic

Mark Tritton

while the last despite few strategy, closed. in In the our progress and stores to significant strong Thanks, Joe. accelerate we've months, growth make digital into crisis, our remained continued delivering

heard you expertise. with new from of team And retail strong three them management transformation a have extensive tonight. We

liquidity continue including cash ABL around initiatives uncertain can believe these a the and manage maintained times. to recent for position, and have facility, We strong preservation new we

in our is capabilities in the cost home investments multi-year under space. reestablish interventions Our transformation way and with authority to

We feel designed meet omni-always expect At is agenda customer-inspired, savings our home. strategic and when center deliver share our deliver market between and future our million. and at and growth. making Beyond & lives, annualized Bath evolving $XXX it to to have the future margin become homes $XXX easy time everyday growth million of rapidly And to our to needs Bed of is the customers a

now are We to your questions. take ready

Operator

Credit have We Sigman Seth from Suisse. Instruction] from [Operator you. question a Thank

Seth Sigman

thanks on Welcome pleased for about in My just everybody. seeing. is you're you seem June, guys, that the taking improvement the that talked the do question question. first Hey, with you trends

that of were down period. still mentioned impacted by throughout those think stores I XX%, obviously was being closed that some you – but stores that

trends some that, I in-store be give that behavior any of think color the as positive. stores were able math reopened could us would imply reopen? that you on confirm you're that to and you Are the more seeing

Mark Tritton

are Yeah. actually seeing of were that slight about Thanks, in the comping but that XX% were a doors open doors having week-by-week that is improvements. our or open, Yeah, Sigman. what LY XX% reflects change we the

surprised So, we've the response we've early really seen. been pleasantly by

government patronage, good the Now, outcomes. we're And nice not strength changing. stabilize. from sales seeing those checks as the our there piece, against signs the we're what's in there that seeing digital affecting is is the that that good the in overall, still traffic, But and the inside demand pent-up turn are that could channel climb be stores,

greater So into also And COVID rather a nice a to in period waiting transferred that early mix, there. mix merchandise than essential.

track. June throughout and some positive July. into We're continue indicators to seeing we're that to So going that

Seth Sigman

That's Okay. helpful.

just are XX% said, you positive, data confirm, opened the to of that that are clarify point? Just stores

Mark Tritton

stores are of an open approximately or the Yeah, flat that have LY. increase XX% on are

the saying. expectations so as exceeding into our ambiguous moment with opening we is with we're went Now conservative some plan, what we're pleased this

Seth Sigman

Got you.

do Okay. but up margin as can is really of about you thinking timeline, are offset drive the upfront the on us how really invest deliver a question here. to be through team of to speed to there, the My early give at that? margin least the progression follow-up identified, the the expansion, term gotten wondering should everybody's savings to we that you feel change here or a for that can effectively how business, outlook, thinking longer you've more there just view is like you on about sense it's I'm some you do And you need that

Mark Tritton

Yeah. Good question, Sigman.

I CapEx on we some expectations, built of forward. The pre-planned already it chain and looking the think focus is that really it of in responding our that continue with review our will some we omni-always to into chunk flight of to channel. transformation pathway. we'll are and costs supply to large offset on but going continue We're around that

So the question first part again was. of your

have you of think your lost there. I please reiterate? first question, you The can I part

Seth Sigman

cut you me? Can operator hear the think I me off.

Mark Tritton

can hear now. I Thanks. you Yeah,

Seth Sigman

question going we was hockey us target yeah. exact half. around hear some I this is progression. to an investments the stabilization stick [indiscernible] not about start at you the it in The with me, a but back point, you're or Yeah, give should know mean thinking really Now upfront I

that about Just any think progression? color to how on

Mark Tritton

Investor at Gustavo going just some more add the color I'm talk to Day. we'll Yeah, October let there.

Gustavo Arnal

Yeah, Thank Seth. hi you and you. nice question for talking your to

margin of that get from Mark out for improvement will we together we I thing one. margin as I improve. comments progression terms think one lay the year-out is, of quarter of October two in will should when hopefully Just think as said, And mean, worst and in is, here QX Day we we is other the Investors a year-in

Seth Sigman

Okay.

Operator

you. Thank

Our from Basham Seth Wedbush. comes question from next

Seth Basham

to good balance persist about your like cash sales Thanks question on afternoon. sales would My what a here, year, Seth if the year? is following of and look the your the for to flow Sigman's trends full dynamics questions. cash everybody. and lot, store your trends Thinking were online Welcome the flow segment through

Gustavo Arnal

cash on on to confident not burn obviously flow. year, quarter, the as remarks, feel that I the going had Gustavo the very not we're tell provide guidance first here. – cash We significant but Seth, generate a you Look, we – And we be Hi can to said I explained closed the we're in which prepared month our ability could months cash in in not but as not balance May. In month that books of our we've I we to out. close should of month seeing June, we be will the yet, come, of trend. the ahead manage preliminarily quarter the say during

Seth Basham

you're might fulfill and changes around That's online you you over thank if that then planning provide do of secondly, approach more out forward. the orders color how term? the helpful medium stores color you you going continue Will that some could think to you. And fulfillment

Mark Tritton

to you. over John,

John Hartmann

your question. Mark. Thanks, for Seth, thanks

with the So, of breakdown to X% representing total. see our the BOPIS it's interesting of our very fulfillment quarter fulfillment in first

of fulfillments, coming Our with our partners. our stores representing balance ramped XX% directly the coming the from out regional vendor XX% and warehouses, up, that we XX%

the we've So to – will a be learned our in ahead. our months response the in quarter COVID lot applying in these around this this the digital customer's in – we demand digital context of and lessons

So, supply in our end-to-end detail transformation Conference more we'll further to the fall. chain on have and our for at come – our end-to-end Investor you

Seth Basham

Fair enough.

Mark Tritton

BOPIS is which within just I'd was kind through rate BOPIS, a here. seeing of add fulfillment piece, digital What the much assist and is in fulfillment us we're quarter. really higher [indiscernible]. The Yeah,

Seth Basham

Understood. much Thank you very and luck. good

Operator

Jonathan Matuszewski Jefferies. next The comes you. from Thank from question

Jonathan Matuszewski

first digital quarter, profile that you've little placing in question if new customer sense? been indicated Thanks about in differences Bath And far. Thanks. during customers customer all to the new core predominantly so for Bed, that the welcomed love in orders a you past parse new Bath. you could versus the you just I XX% the those just that profile customer We'd Hey channel? your bit time, seen guys, for a color had hear of brand any good pre-COVID evening. Bed, more the the a of on out to of the were

Mark Tritton

and store customer or – at really Yeah, or we're customer are from in prior compared buybuy have is they spending way. in strong BABY, they Jonathan, are the power. Bed, is so overall, omnichannel, younger spending Bath We're same new seeing still that the they great across in seeing & But whether customer profile basket. them what a that are of the spending digital patterns total the Beyond

forging Our with conversion deep and rates really strong new a relationship them. are very, we're very

with intact, we're the post-COVID going and whole fresh come very new of but curbside a way. a company customers working and omnichannel way So period an new to BOPIS set a into of in as

for So it's time us. an exciting

Jonathan Matuszewski

that helpful. going actually customer is, are a and these And how that What dynamic? retention forward – the more longer-term are on do just question how marketing about you differently and maybe what forward That's then doing you going think retention newly loyalist? is of kind you've guys into that thinking for there? plan follow-up your the to done opportunity lifetime in be converting going what's acquired past customers kind of versus about you How

Mark Tritton

in immediate been in been has messages the customers there an that's direct. think more engagement receiving I open that Yeah, change have way and to

scale we a On personalized macro into are our So, then new we customers is Officer embarking we've messages Chief customers more on response. and Davis, existing with Cindy Brand target what doing more and Jonathan, review look a blend is be sit number issues as in and to of Community and the with you day in that Investor a full we sharing address we'll these of royalty more of kind October. of

Jonathan Matuszewski

much. so Great, thanks

Operator

you. Thank

Our next question comes from from Curt America. Nagle of Bank

Curt Nagle

good very taking for question. much Thanks the Great, evening.

end back be of exit trim just So, are year and June, stores. correctly, unproductive as most quite is a to open, number off, in of to July June, sounds heard start it of are headwinds we going in I the starting store positive I the decent strong base flow some if comp lapping half even the bunch cash like rates guess in and the maybe of generated

So grow Bath think Bed, core it's for do year? the possible EBITDA the of guess in least, that at you you could theory, remainder I

Mark Tritton

we're a that return the for what on an out strong is Curt, I stores is transformation us new us in that prediction Hi forward-looking is increase the blocks and think mean or together to I QX will share but to with give no very as Mark deliverables right, with going do outcome support and profitability, And going nice putting well building provide for are here. we is know. keenly tailwinds headwinds as acceleration your of you be math to the somewhat statement We're customers, to digital, the a strange think not EBITDA we anomaly, today. but any to such we as some seeing

Curt Nagle

yeah, the of margin And of some kind year? terms of composition Okay, in of things know fair private in half the back you of SG&A? like savings the Mark, maybe early could kind bigger just that in little past, year think missed And maybe that of that least directionally at XXX initiatives label terms to of a reinvestments? terms next the Is enough. How gross margin, how we've of stands forgive more, into about then of I how some and if of bit this, sort kind some in the me you any to is what just and and much if in XXX is of if talked the the for about color gross sourcing of possible, timeline? of clarify

Mark Tritton

piece, first. really we will QX our so that really to into will as value brand Yeah, a all have last we own outlined take they gross mix. materialize – event bit that The overall add again margin onwards

have number giving of be SG&A. aggregate in and that there, are an buckets active up, said, we but quite taken on as kind a We is of will annualized which in you been, step an didn't very substantial we basis

to in are into our a benefit savings negotiated margin. and refashioning our brands, will we substantial have which assortment lines, our supplementary to So, COGS have lean we

We savings. are with great and IT costs transforming our general infrastructure

very store the look on will $XX of fortuitous to EBITDA was in to already XX program, reduction, going dollars million ahead line. February the are We strong COVID which cost a enough were moment. we And at to rationalization embark fortunate which to add

will forward the to represent buckets of at kind the Community Day. in do for in So things October XXX, we XXX allowing all to but look another you these collectively more Investor

to follow. more So

Curt Nagle

right. All

terrific. very much. that's Okay, Thanks

Operator

Thank you.

JPMorgan. from from comes Christopher Our question next Horvers

Christopher Horvers

Thanks. Good evening.

question So SG&A. talk of about there and my the Q Can sales some of believe into is it about out probably the that? And first costs you change about year-over-year. are helps you reclassification disclosures some in disclosure cost like or year, [XXX some basis is of of seems the then you by inclusive restate gave, that last with you I points] did that it

Gustavo Arnal

Gustavo here. Chris, Hi

and some to our impact we cost QX, margin, costs goods. we distribution fulfillment not these of on First did have of we given specification. bit that, GAAP as And EBITDA. the of QX, in that need took rules, going updated bigger of some total the know, of great P&L revisit per with any and with opportunity The it we only, level basis the digital you in would to depressed saw XXX the sales points the quarter. record on in be company gross basis into assumptions growth or It's in explosion the little it's a than that impact a

refining it we digital it or assumptions of up the model Now, of we these reality We business helps. in restatement that our we wanted do that why that's periods anything, because hope pivoting And Q. only the if think was a are disclosed can any not again separately to I we be needed. transparent as the first. warrants prior follow into on that and

Christopher Horvers

those Okay. Bath And you Bed, Christmas can Tree negative] Harmon? talk were many on then wall closures, you to envision versus those of the prior the an basis? in of of terms about XXX EBITDA COVID, how how many core do and being [four And

John Hartmann

four today don't for John our XXX any in primarily Thanks you call we've are on referred here. stores, I Approximately stores. remarks your report Bed, this have detail for that but further question. Beyond the about to our performance prepared and Bath & those in of Christopher, wall stores

Christopher Horvers

guys. of Best Understood. luck

John Hartmann

you. Thank

Operator

Thank you.

McShane comes from question Kate next from Sachs. Our Goldman

Kate McShane

end question. for to regards if afternoon. you taking that for about purchases, inventory negative come had still XXXX inventory reduce canceled I can with talk And in good of back to how With the And inventory the had implications could below Thanks you the inventory, about you half year. of related see regards just year? you what through thinking wondered levels? that, you're Hi, were carrying any to to to before the with plans my COVID, the regards

Joe Hartsig

is This Kate. Hi that. Joe. I'll take

your it's one. So And for good thanks a question.

to some been about end at inventory the a reduce on multi-year we've I Gustavo think QX. know you made as And position of journey and increase comments turns. inventory

good about So feel our we reduce in receipts. very agility that to

be So COVID as of chain in been we – mindful hand think about on very we opportunistic yet where able the of of restarting for our with situation we've back balancing stores, the and terms being at to being and outlook we turn our supply want in areas investing to growth. are

inventory terms using inventory. tools and centralizing efficiencies of we're for a we're manage lot of work on in So management, inventory new planning, to doing processes

doing purposeful around make as I reviews We put more where optimize have investment. SKU assortment we're sure And we products, line terms of and we to we're mentioned. things will efficient our category where be in

we So a on on we're of on way before goals lot and doing well work good inventory. that. our to outlined intention, think our doing continue right, I the that It's

Kate McShane

you. Thank

Operator

Thank you.

comes from Our James. Raymond Griffin Bobby next question from

Bobby Griffin

and targeted, a high at your e-commerce Good notable past, more when afternoon, you've sales a or of done seen Mark, just markets. closures in you store some announced but you talk to everybody. have first think bit look closures you the the change at about any back wanted those in level, you've the in little that I

I've curious close bit just markets they talk companies it's work Bath. some how years weakness a the little Bed, heard once for Over on e-commerce in about store, a

Mark Tritton

comment Yeah. I talk a prior to data can't to quite lot about Bobby, good the you.

I analysis, of And really channel. of we're done upcoming fulfillment, the store a confident radius the think radius mile again projecting, and retain as well looks level mile to XX we prior and digital a in level market what absorb is a years. we through feel naturally revenue market that closures micro and digital that the through the going stores are what XX then for by as in like that understanding a we've overlap, hub,

of out strength it's reliance new coming moment the think I a digital. game, and with the and customer’s COVID

greater access think them customer I then an that supplementary so services. And to with provide and us engage the even provides

I a performing lot don't strength mind and it, digital closure we oranges have the it of it's is now. our apples and and the wasn't an So think to background but way

I looking a new So game really we're think at plan.

Bobby Griffin

would about And is on the are what of June cash a that with guess pre-COVID of some other coming type on allocating And cost structure? in are margin imply you or true? that I assuming terms back because to SG&A lower structure, e-commerce. versus for based any guess of continued and bringing much how that flow Okay. me, on of of employees SG&A back commentaries I lastly pressure and some you're the of kind you

Gustavo Arnal

at Mark to SG&A real will or in $XXX but part has Hi million in opportunities as estate John about SG&A. will here. from waiting. million that Look And that general. said, Gustavo looking $XXX only talked SG&A, plan the Bobby, going are store And not come we of savings we continue not

Mark continue action, And as shortly. will We actions we're waiting and all to February some know are to. to actions in alluded we not take taking some be taken

down after right. intervening this SG&A was the You think [indiscernible] QX of last the two in really and was XX% quarter. that months of

SG&A really, in I yet, above said, driving two really want really, throughout And reduction continue to as reductions XX%. the year. we the So those months was

Mark Tritton

snapshot lower at you is have filtering there. double-dip heavy large through margin just digital to incurred that I'd heavy, product costs in potential. effectively, offset of those margin we if geared had of amount didn't also gross capabilities right the you when that our add time Bobby, we really the is, then know a in One perspective, moment and we look

mix of is through and margin to We're As XX%, we've XX% taking come seeing July the were period, and June, across are board cost the changing our play. our also BOPIS structure. mix into up fulfill natural store seeing our our what we into come

buying and of the they're customers what don't much, trapped I natural just from. from see time. indicative upside, where So really is but in actions, reflow are our of not it We good it's anything QX think buying that just

Bobby Griffin

of second Thank the in quarter. you. luck Best

Mark Tritton

you. Thank

Operator

Thank you.

question next from Brad Our from KeyBanc. comes Thomas

Brad Thomas

Hi, for question. my thanks taking

is you is? of the And how perspective price you're a importance I perception the to show topic, of from what price the you of latest in work about and forward, that forward? And to those are today? emphasized going wanted customer thinking Thanks. terms just coupons back how your importance You what going scoring circle

Joe Hartsig

is This Joe Hi, Brad. again.

So we're I is think as key focused price on. mentioned, five Mark had one pillars of the that

you when customers something all important and our price is that so comes promo it's under taking Value think value. very and about we together to have And seriously.

this baseline Coupon, year. new – about can a pricing we're launched in like we work evaluating last part lot formalizing our big today. doing as we our spending evolve and all pricing team, strategy, a a of management time of and it. on dynamic As we're know But you so late talking is mix

roles ways. some category we're, the a you've seen categories we to into last to of months, competitive do more we where over different we establishing and we're effect evaluate but overall think more in better six gaps pricing continue pricing, I and which is promo is market again to few look dynamic come we're One, spending put it's something want play that into price strategies. to and something our to pricing will lot on time guide want a would

where discussions. more be the pricing we with price on put make to using activating conjunction more Two, want we and we at line can that promotions], investments. own reviews, then very So We're supplier we brands are we're and [those optimize affect we're when we will future in in and focused efficient. thorough where new can that spend promotional sure to we to address and good opening do tools is with price points also points promotion promotional effective price looking so make proactively

we we our again because to are, studying important our is that ways would but the customers. that more helps. So we to ways loyalty say I and evolve then retain think programs there new long-term, new and hope ways over are lastly, I

Brad Thomas

and That's very luck. Thank helpful. good you so much

Joe Hartsig

Okay, thanks Brad.

Operator

Our next from question Lasser comes UBS. Michael from

Michael Lasser

taking Thanks evening. Good questions. for my lot a

a you of – open. have you're So your XXX% stores nearly

since what openings, are up for will you back recognize but your is aggregate same-store what in a and is up aggregate? that I XX% sales So look comp opened in if flat open all – or of stores? would store or you the the aggregate the be

Gustavo Arnal

last in be of the weeks Gustavo The month on negative average to. Hi during store two comparable performance here. would low-single as digit alluded June, the pickup the sales Michael, of month per a Mark a with

Michael Lasser

store million. And to coming is per second closing about you. SG&A million, XXX thank Okay, you're question my $X closer $X.X is, stores, your

than $X.X today? your closing larger to going SG&A Why the save almost in billion costs be $XXX dollars stores. $XXX cost savings from you've wouldn't million You're just that or outlined to those ultimate much million

Gustavo Arnal

Yeah.

but So, at intervention. detail what as thinking going a We're is SG&A, your We'll this SG&A I a will generate. give at leading, value P&L on program as but only may profitability. more as but of not the but of more you pickup said, intent it the an of And not change that he certainly detail in the on of the the question I revenues, some understand components, together the in this give first. those more be there digital program at as on John creation. to on plan they give be focused the within holistically but you rather stay And get details think looking loss the of context and later, point. that creation we it, value in therefore program four that put fall, not SG&A model, is about P&L is we're our only we this the revenue, business walls, in And of

Okay.

Michael Lasser

Makes sense.

you you'll expect have Just you to expectation clarify, Gustavo, those some What closing? sales for their be do is number? – around the that do stores team,

Gustavo Arnal

Mike, you were cutting you bit, off repeat? a can little

Michael Lasser

an expect retain? Do percentage of of you sales to that stores from you those have expectation

Gustavo Arnal

not going We're together plan. the stores. put as a we close sales to we of will recovery that part is it Yes, share now, but

Mark Tritton

And we'll some lose lose but transfer or the sales. will Michael, of we SG&A, the

the EBITDA exercise. the of not So that what is savings, focus the SG&A on net-net we just

again Gustavo more So said as in to October. follow

Michael Lasser

you very much Got Take and luck. good it.

Operator

Thank you.

comes Our from from next Morgan Simeon Stanley. question Gutman

Simeon Gutman

and time. time, your to over I a going can thinking be realize of in I you retail it ballpark, may think Mark oranges. before, This and than prior is to Mark, like to that Thanks Gustavo everyone, regard sales, – more I tricky ever time even is appreciate but one Can transfer I taking on sounds expectations my the the lower what higher do it to retained but transfer based question. with heard putting XXs, you not more that are Hi welcome. lot rate. or try lower? In are maybe this moment than of you're I'm little numbers maybe for be that assuming it, XXs on it question, suggest digitally realm apples in a maybe may answers around rate. a And higher moment the prior sales you the a we've that. or thinking math be

Gustavo Arnal

yes, so it's in Simeon, to get Okay I'm I not but going realm. specific, look, mean, the

is be competitors, of density duplication market. I think to issue a clearly of we've see and establish overlap lot you've our end XXXX we're What to different to market going and got, XXXX therefore the slightly is the looking ball a been able game different a the at because numbers of in play. we

So addressing the into. stores market sale carefully. that one done on We've this math very could algorithmic we've collapse very, level got actually we maybe higher two

maybe or filling repositioning of we market buys address in And to the fleet that format digital can see we set some about then gaps the total We'll our store positive price the really will scope. in see market the net, a We line with strong achieve move will really transfer, see of degradation. what the be see but some EBITDA. of some of digital. net we to into will We'll and terms bottom some slight some

it reshape, but the at it's to the will a EBITDA a year way. sequential So, reframe at we by heart impact. benefit Again net and then map out is along that of

forward majority of it QX of more on the be we in it years. detail you. sharing Some will the will And next two XXXX, over but look begin to that with

Simeon Gutman

right how this that share you half. the you are the have to Okay. at much And college on doing? regarding back What then, my are can you your college demand. you ever to it's next little quarter in and plan recently. have back How Meaning bit Everything point? you, the can sales you've by you impacted taken shared because – second is actions back-to-school? follow-up And quarter, could have stimulus fluid shaped a and pent-up back

Mark Tritton

stores college no, be major our you to the in And days. in back say point. whether to college very should And moment full we've and over we've we sharing to we we heavily several we set and we July August as the of while for of back into really pleased, into actively I pivot was it other monitor won't would that month but did bit weeks. up This So been how we launched portion active early, pre-COVID little is proceed we change should agreed proceed. first digital to the sales, the what and

AUR, in-store both We pleased and sales, are gains off we've it's digit of engagement, very the the both and conversion, result seen with double online running. and

value, people Now it the established as and these did to John late as company pinning break we changes. it mentioned, Pinterest like were But college still per relevant we that months were ago ID very early comprehensive unique we and correlating, back was with very several digital mindset. sharper It's running and and really have aligned. and here, consumer onset. clear very a We We've we lent set the product store it's up and in in that is early ups not program. have have

I'm rest already had indicators positive the What with penetration we've see that but along we the quarter. and share, assortment. it the of prevailing So rest to positive through on going the has, of not depth our that

progression about bullish the we're full, that positive the not we're about So, quarter in but seeing.

Simeon Gutman

comparable to for only, separate if just low-single you just the that's this a stores. can. sorry digit stores for I'm second clarification, two down clarify? of And including not That's said Gustavo I digital,

Gustavo Arnal

Correct.

Simeon Gutman

you. Thank

Operator

Thank you.

from from JPMorgan. Carla comes Casella Our next question

Carla Casella

Hi. how the back-to-school, talked back-to-dorm, second college your caller. One you on the type of much represent question business that seasons? quarter? biggest that prior The of to follow-up typically about, Is one

Mark Tritton

a No, it It's season. not good biggest. of is one our

major it's the go it our of is Bed it But only that wedding we a area seasonal to connective We customers Beyond it & one Beyond experience and events part not with specify it with Assuming and moving registry, we, an & think who experience but of represents BABY that you represents. sales question proportion with declined is to customers. great Bath actually a quarter asked the actually our Beyond Beyond. engagement life tissue to Bed and from moments college of with Bath opportunity, promotional

us, believe relating this we and I'm So early happy is an for area very with the important response.

Carla Casella

transferred new the then that initially great. is Okay, over drawn million And ABL? facility, you the from credit $XXX the it on new to revolver on just

Gustavo Arnal

we million Hi, the simply million. of Carla. ABL $XXX million, the what Yeah, $XXX not full That's yeah, of that provides was a it ABL. liquidity, into a net rollover additional is $XXX said

Carla Casella

back bonds? does then, And to you great. ability are Okay, on it – restrictions your any have buy

Gustavo Arnal

No.

Carla Casella

Okay. Great, thank you.

Operator

you. Thank

from comes Our from Chukumba next question Anthony Loop Capital.

Anthony Chukumba

were bath question. as this Good evening. to promotional I a of and off talk for your color like and bit But my headwinds bedding margin, up now, literally the it. just and strategy, up right I XX% in select towels I website, rugs, recall Thanks to you level off of see gave XX% terms gross don't helpful. on that what to Wanted know promotion. was your I of about taking appreciate lighting just a seeing I'm XX% see lot little very and of

changes Or in So I off, And were of of guess my of sort all question sort degradation increased promotions this? reading I in factor any a am quarter? second your then terms the of is in is, first margin gross into much have first made Thank strategy? terms you. too promotional in

Joe Hartsig

Hi is Anthony, Joe. this I'll that. take

and lot continue we in of back tools will would a say, months. promotions last, I because say would a say I that be promotions in that learned do investing, the mentioned working. eight pretty mix didn't mix, marketing we of we are part in but to investment March, dialed merchandising over them I stronger significantly lift So back promotions get promotions we make sure, our to as would when see I our we we make. we the the

strategy I forward. lift we and need an before and effective and tools, elasticity processes didn't we think the that to all didn't, understand we have we'd drive out probably right going promotional call it to the

we'll those do. making changes and what improvements be selecting we're So, and we

website. you're what seeing into the much on too read wouldn't I So,

we out need and resets. to promotions work some inventory through our will We clear do where

Mark Tritton

website our on pricing ad website the Anthony. increased like you're we've it's you're Yeah, clarity to say you but and greater seeing scaled just straight adjusted I'll we've July actually an not at sale looking and or X promo, after weekends back.

So you. yeah, thank

Anthony Chukumba

sort sort guess any promotional coupons. where off still – in of Have you related follow-up. Okay. come of the of I I of And there and are strategy to update just that terms to playing or I of part sort mean, actually Any that? sort wanted through. are the you're you XX% you working know holistic of that with pricing

Mark Tritton

we've it a we business just rather store it on and of part pillar. the outcome, to going on with very are. on we're into coupon have as we good as we seeing business of business but natural we will promotions, not as want the is It that D&A]. fair and opened actually use in digital mentioned, it's Joe base more as and pulled we to didn't redemption be look back back of part during pulled promise think to at up lean of more we say I the COVID a forward coupon, result. lower period management of with who coupon and We as strategically than a stores much, Yeah, our surgically disappear, absolutely pillar our strategic going is the [our rate closed it it we more And price normally

We helm. looking will Cindy loyalty value, intersection at the at more be coupon unpacking that and Joe between with and the price, and

So, follow more that. on to

Anthony Chukumba

you. Got it. Thank

Operator

Thank you.

for It We one have question. from Baird. from Peter time Benedict Mr. comes more

Peter Benedict

the reviews in, of questions with had to my rebuilding efforts? understand on addressed Most a form for and the be by you me I the they maybe slide the if on to could to other what's one been pressures here. of guys, just curious supplier you're take? your vendor assortment little more, doing timeframe trying profitability part those Hey what guys, and on just that, have the maybe was base? actions. going do What that expand is bit optimization speaks Just there merchandising for profits, but thing sneaking kind that of thanks authority, it category

Joe Hartsig

is This Joe Peter. again. hi Yeah,

with improve employed started our opine year categories I third fall ways a transition last some some I but we back are bedding to the remark set and destination pretty of on different of lot in of would let the into categories. phase or on at with yet, look through we of again next pleased I in the COGS won't bath. and we we Some on work the been maybe working how we're We've that, sourcing. say, rolling of that's we're of some of And will Mark Gustavo going effective inventory. our when the And at and that through work would look of that, second and benefits but a work

do So external line internal one and using of reviews. data is data, to the much data more promising things that's real for us effectively

a of the So teams this. getting with embracing we're pleased so that out Mark? the some really this we far are are of results of excitement lot with and

Mark Tritton

much. but general were lend is brand in too which way, just shopping we categories, say also is, occasions and winning costs. ancillary differentiatable paying Yeah, into key Peter, I the were and We ordering margin decentralized on a we rich, enough our programs. will rooms weren't assessment focused didn't on creating We

see overall in see flight doing part they that of roll the but terms net are that benefit, deep, bottom are above are feverishly benefit line, ongoing, and the times our We to Joe Again, reaching, bottom of have started work hitting we of EBITDA are led concurrently last we but work. to excited that curation are it's They different they that work, stepped we'll benefits year. in and about they all of in great the line out against. the really truly ongoing

Peter Benedict

luck. thanks and helpful, That's terrific. Okay, good

Mark Tritton

Thank you, Peter.

Operator

like to to now back you. remarks. Ms. Thank other I turn And any for call would the Barth

Janet Barth

Have additional night and comments. contact for Feel you, good call today. on free with Thank stay safe. all you Thank any our a participating to Hilda. or me questions

Operator

this Thank you Thank for and conference. you. gentlemen, today’s participating. Ladies concludes

may disconnect. You now

20230930-DK-Butterfly-1 (BBBYQ) 9 Jul 202020 Q1 Earnings call transcript