Blue Apron Holdings Reports Second Quarter 2020 Results

Key Highlights:

• Net revenue for the second quarter of 2020 increased 10 percent year over year and 29 percent on a quarterly sequential basis to $131.0 million largely due to the impact on consumer behavior from the Covid-19 pandemic, as well as the continued execution of the company’s growth strategy.
• Increased Customers by approximately 20,000 in the quarter.
• Average Revenue per Customer increased 25 percent year over year to $331, Orders per Customer increased 17 percent year over year to 5.4 and Average Order Value increased year over year 5 percent to approximately $61, all the highest reported levels since prior to 2015.
• Achieved net income of $1.1 million, or $0.08 diluted earnings per share, and a 148 percent year-over-year increase in adjusted EBITDA to $11.1 million.
• Generated operating cash flow of $15.7 million and free cash flow of $14.4 million.

Blue Apron Holdings, Inc. announced today financial results for the quarter ended June 30, 2020. “Blue Apron’s strong second quarter 2020 operating results reflect quarterly sequential and year-over-year double-digit net revenue growth and marked our return to topline growth sooner than expected. We also expect to see year-over-year net revenue growth in the second half of 2020,” said Linda Findley Kozlowski, Blue Apron CEO. “Our progress with our strategic growth plan, together with the increase in demand we saw from the Covid19 pandemic, resulted in solid and continued year over year growth in key customer metrics, including Average Revenue per Customer, which was above $300 for the first time in more than five years. As a result, we generated strong adjusted EBITDA and free cash flow in the second quarter, which adds financial flexibility for Blue Apron to continue executing our strategic growth plan.”

Second Quarter 2020 Financial Results

• Net revenue in the second quarter of 2020 increased 10 percent year-over-year to $131.0 million and increased 29 percent on a quarterly sequential basis. The increase in net revenue was primarily due to an increase in Orders per Customer and Average Order Value during the three months ended June 30, 2020, as changes in consumer behavior largely due to the Covid-19 pandemic drove customers to order more frequently and add more meals per order.
• Cost of goods sold, excluding depreciation and amortization (COGS), as a percentage of net revenue decreased 60 basis points year-over-year from 60 percent to 59.4 percent primarily driven by decreases in shipping and fulfillment packaging costs due to pricing improvements and increased use of more cost-effective fulfillment packaging, and a reduction in food and product packaging driven by improved planning and process driven strategies, partially offset by an increase in labor costs largely due to increased usage of higher-priced temporary labor, as well as wage increases and attendance two bonuses put in place as incentives for frontline workers to increase fulfillment center capacity in response to the Covid-19 pandemic.
• Marketing expenses were $11.6 million, or 8.8 percent as a percentage of net revenue, in the second quarter of 2020, compared to $9.7 million, or 8.2 percent as a percentage of net revenue, in the second quarter of 2019, as the company reaccelerated its marketing efforts, including an increased focus on brand awareness.
• Product, technology, general and administrative (PTG&A) expenses decreased 7 percent year over-year from $35.1 million in the second quarter of 2019 to $32.5 million in the second quarter of 2020, reflecting the company’s continued focus on expense management, optimization of its cost structure and, in part, savings realized from the Arlington facility closure in May 2020.
• Net income was $1.1 million and diluted earnings per share was $0.08, in the second quarter of 2020, based on 14.0 million weighted-average common shares outstanding diluted, compared to a net loss of $7.7 million and diluted loss per share of $0.59, in the second quarter of 2019, based on 13.0 million weighted-average common shares outstanding-diluted. Sequentially, net income improved $21.2 million quarter-over quarter from a net loss of $20.1 million in the first quarter of 2020.
• Adjusted EBITDA increased 148 percent year-over-year to $11.1 million in the second quarter of 2020, compared to $4.5 million in the second quarter of 2019. Sequentially, adjusted EBITDA improved by $16.9 million quarter-over-quarter from a loss of $5.8 million in the first quarter of 2020.

For more information, visit the official report.