While in October the business received an additional $35 million via a secured loan with a maturity date in March 2023, the company used most of the proceeds to cover its revolving credit facility that was about to mature in August, so it’s safe to assume that cash from the loan is already gone. At the same time, Blue Apron once again generated a negative FCF of -$9.1 million in Q3 against a negative FCF of -$8.9 million a year ago.Īt the end of September, Blue Apron had $58.7 million in cash reserves, while its net debt position was $20.4 million. What’s even worse is that in Q3 Blue Apron experienced a 7% Q/Q reduction in customers to 357,000 customers, while its average revenue per customer declined from $331 in Q2 to $314 in Q3. Also, after making $1.1 million in net income in Q2, Blue Apron once again began to lose money and in Q3 its net loss already was $10.9 million, while its GAAP EPS was -$0.96, even though the pandemic was still not over during that time. Later in Q3, Blue Apron managed to generate $112.25 million in revenues, which was up 12.8% Y/Y, but down 14% Q/Q. In Q2, when the US was on a strict lockdown, Blue Apron managed to increase its revenues only by 10% Y/Y to $131 million, which was significantly below $200 million in revenues that it achieved in Q2’17. That’s exactly what has happened to Blue Apron in Q3, as its Q/Q growth has stalled, while its shares depreciated by more than 15% since the article came out.īlue Apron will release its Q4 report on February 18 and we don’t believe that we’ll see an improvement from Q2 or Q3. In our latest article on the company in July, we said that only lockdowns helped Blue Apron to extend its lifetime, however, we also believed that the company had reached its peak in Q2 and it’s unlikely that it’ll be able to show growth in the following quarters. Also, Blue Apron has a solid history of underperformance and if it was not for the pandemic, then there’s a high chance that it would’ve gone out of business in 2020, as its management team has been actively selling its shares in bulk last February. The company has been losing customers and destroying shareholder value since becoming public in 2017 and to this day it fails to consistently make a profit. The Unsuccessful Turnaroundīlue Apron doesn’t have a unique business model, since all that it does is sells meal-prep kits across the United States.
Considering this, we continue to short Blue Apron.
It’s also unlikely that Blue Apron will be able to show a solid performance in Q4. The earnings results for Q3 showed that even during a favorable operating landscape its business failed to show a Q/Q growth. There's a lack of leadership, constant underperformance, and an inability to consistently make profits. We believe it’s only a matter of time until Blue Apron ( NYSE: APRN) goes out of business.
0 kommentar(er)
