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BARK Reports Third Quarter Fiscal Year 2025 Results

NEW YORK--(BUSINESS WIRE)-- BARK, Inc. (NYSE: BARK) (鈥淏ARK鈥� or the 鈥淐ompany鈥�), a leading global omnichannel dog brand with a mission to make all dogs happy, today announced its financial results for the fiscal third quarter ended December 31, 2024.

Key Highlights

• Total revenue was $126.4 million, ahead of the high-end of the Company's guidance range and a 1.1% increase, year-over-year.
• Commerce revenue was $20.3 million, up 43.5% compared to last year.
• Gross Margin was 62.7%, up 90 basis points compared to last year.
• Net loss of $(11.5) million, was $1.4 million greater than the same period last year primarily related to a $1.8 million gain from the extinguishment of debt in the year-ago period.
• Adjusted EBITDA was $(1.6) million, within the Company's guidance range and a $4.9 million improvement, year-over-year.

"We closed 2024 on a high note, exceeding our revenue expectations and delivering our tenth consecutive year-over-year improvement in Adjusted EBITDA," said Matt Meeker, Co-Founder and Chief Executive Officer. "Our focus on building and empowering a world-class leadership team is starting to deliver results, with momentum building across the business. In the quarter, we achieved our strongest new subscription quarter in three years, grew commerce revenue by 43% year-over-year, and generated $2 million in revenue from BARK Air鈥攋ust seven months after launch. Importantly, we delivered these results while maintaining a disciplined focus on profitability. We are Adjusted EBITDA positive through the first three quarters of fiscal 2025 and remain on track to achieve our first full year of positive Adjusted EBITDA next month. With a strong foundation and the right team in place, we are taking decisive steps to position BARK for sustainable growth and long-term value creation."

Fiscal Third Quarter 2025 Highlights

• Revenue was $126.4 million, ahead of the Company's guidance range of $123.0 million to $126.0 million, and a 1.1% increase year-over-year, primarily driven by a 43.5% year-over-year increase in the commerce segment.
• Direct to Consumer (鈥淒TC鈥�) revenue was $106.1 million, a 4.3% decrease year-over-year, primarily driven by fewer total orders in the most recent period.
• Commerce revenue was $20.3 million, a 43.5% increase year-over-year, driven by adding new partners, and expanding shelf space and SKU counts with existing partners.
• Gross profit was $79.3 million, a 2.6% increase year-over-year.
• Gross margin was 62.7%, as compared to 61.8% in the same period last year.
• Advertising and marketing expenses were $27.4 million as compared to $25.1 million in the same period last year, driven by an 11% increase in new subscriptions acquired in the quarter.
• General and administrative ("G&A") expenses were $64.1 million, as compared to $66.1 million last year. This decrease was largely driven by a reduction in headcount.
• Net loss was $(11.5) million, as compared to $(10.1) million in the same period in the previous year. The greater net loss is largely related to a $1.8 million gain from the extinguishment of debt in the year-ago period.
• Adjusted EBITDA was $(1.6) million, the midpoint of the Company's guidance range of $(3.0) million to breakeven. Given the Company's ability to efficiently acquire new subscriptions at a lower customer acquisition cost, it invested more in marketing during the quarter.
• Net cash provided by (used in) operating activities was $(1.4) million. Free cash flow, defined as net cash provided by (used in) operating activities less capital expenditures, was $(2.0) million.

Balance Sheet Highlights

• The Company鈥檚 cash and cash equivalents balance as of December 31, 2024 was $115.3 million, and reflects $2.8 million of share repurchases at an average price of $1.69, in the quarter. Fiscal year-to-date through December, 31 2024, the company has repurchased $8.0 million of shares at an average price of $1.54.
• The Company's inventory balance as of December 31, 2024 was $90.4 million, an increase of $6.2 million compared to March 31, 2024. The increase is largely driven by the Company bringing in additional product in anticipation of stronger sales in fiscal 2026.

Fiscal Fourth Quarter and Full Year 2025 Financial Outlook
Based on current market conditions as of February 5, 2025, BARK is providing guidance for revenue and Adjusted EBITDA, which is a Non-GAAP financial measure, as follows.

For the fiscal year 2025, the Company is reaffirming its guidance of:

• Total revenue of $490 million to $500 million, reflecting year-over-year growth of flat to 2.0%.
• Adjusted EBITDA of $1.0 million to $5.0 million, reflecting a year-over-year improvement of $11.6 million to $15.6 million.

For the fourth quarter of fiscal 2025, the Company expects:

• Total revenue of $121.2 million to $131.2 million, reflecting year-over-year growth of (0.2)% to 8.0%. This range accounts for the potential variability in the timing of commerce shipments that could shift from the fiscal fourth quarter to the first quarter of fiscal 2026.
• Adjusted EBITDA of $0.9 million to $4.9 million, reflecting a year-over-year increase of $(1.3) million to $2.7 million. This range reflects the above items as well as potential variability in the Company's marketing investment, given recent success in efficiently adding new subscriptions.

We do not provide guidance for Net Loss due to the uncertainty and potential variability of certain items, including stock-based compensation expenses and related tax effects, which are the reconciling items between Net Loss and Adjusted EBITDA. Because such items cannot be calculated or predicted without unreasonable efforts, we are unable to provide a reconciliation of Adjusted EBITDA to Net Loss. However, such items could have a significant impact on Net Loss.

The guidance provided above constitutes forward looking statements and actual results may differ materially. Please refer to the 鈥淔orward Looking Statements鈥� section below for information on the factors that could cause our actual results to differ materially from these forward looking statements and 鈥淣on-GAAP Financial Measures鈥� for additional important information regarding Adjusted EBITDA.

Conference Call Information
A conference call to discuss the Company's fiscal third quarter 2025 results will be held today, February 5, 2025, at 4:30 p.m. ET. During the conference call, the Company may make comments concerning business and financial developments, trends and other business or financial matters. The Company's comments, as well as other matters discussed during the conference call, may contain or constitute information that has not been previously disclosed.

The conference call can be accessed by dialing 1-888-596-4144 for U.S. participants and 1-646-968-2525 for international participants. The conference call passcode is 5515653. A live audio webcast of the call will be available at and will be archived for 1 year.

About BARK
BARK is the world鈥檚 most dog-centric company, devoted to making dogs happy with the best products, services and content. BARK鈥檚 dog-obsessed team applies its unique, data-driven understanding of what makes each dog special to design playstyle-specific toys, wildly satisfying treats, great food for your dog, effective and easy to use dental care, and dog-first experiences that foster the health and happiness of dogs everywhere. Founded in 2011, BARK loyally serves dogs nationwide with themed toys and treats subscriptions, BarkBox and BARK Super Chewer; custom product collections through its retail partner network, including Target and Amazon; its high-quality, nutritious meals made for your breed with BARK Food; and products that meet dogs鈥� dental needs with BARK Bright庐. At BARK, we want to make dogs as happy as they make us because dogs and humans are better together. Sniff around at BARK.co for more information.

Forward Looking Statements
This press release contains forward-looking statements relating to, among other things, the future performance of BARK that are based on the Company鈥檚 current expectations, forecasts and assumptions and involve risks and uncertainties. In some cases, you can identify forward-looking statements by terminology such as 鈥渕ay,鈥� 鈥渨ill,鈥� 鈥渟hould,鈥� 鈥渃ould,鈥� 鈥渆xpect,鈥� 鈥減lan,鈥� "anticipate,鈥� 鈥渂elieve,鈥� 鈥渆stimate,鈥� 鈥減redict,鈥� 鈥渋ntend,鈥� 鈥減otential,鈥� 鈥渃ontinue,鈥� 鈥渙ngoing鈥� or the negative of these terms or other comparable terminology. These statements include, but are not limited to, statements about future operating results, including our strategies, plans, commitments, objectives and goals. Actual results could differ materially from those predicted or implied and reported results should not be considered as an indication of future performance. Other factors that could cause or contribute to such differences include, but are not limited to, risks relating to the uncertainty of the projected financial information with respect to BARK; the risk that spending on pets may not increase at projected rates; that BARK subscriptions may not increase their spending with BARK; BARK鈥檚 ability to continue to convert social media followers and contacts into customers; BARK鈥檚 ability to successfully expand its product lines and channel distribution; competition; the uncertain effects of global or macroeconomic events or challenges.

More information about factors that could affect BARK's operating results is included under the captions 鈥淩isk Factors鈥� and 鈥淢anagement鈥檚 Discussion and Analysis of Financial Condition and Results of Operations鈥� in the Company's quarterly report on Form 10-Q, copies of which may be obtained by visiting the Company鈥檚 Investor Relations website at or the SEC鈥檚 website at . Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to the Company on the date hereof. The Company assumes no obligation to update such statements.

Definitions of Key Performance Indicators

Total Orders
We define Total Orders as the total number of Direct to Consumer orders shipped in a given period. These include all orders across all of our product categories, regardless of whether they are purchased on a subscription, auto-ship, or one-off basis. Total Orders excludes orders from BARK Air. We use Total Orders as an indicator of customer interest and demand.

Average Order Value
Average Order Value (鈥淎OV鈥�) is Direct to Consumer revenue for the period divided by Total Orders for the same period. AOV excludes Direct to Consumer revenue from BARK Air. We use AOV to provide insight into customer spending patterns.

Key Performance Indicators

Non-GAAP Financial Measures

We report our financial results in accordance with U.S. GAAP. However, management believes that Adjusted Net Loss, Adjusted Net Loss Margin, Adjusted Net Loss Per Common Share, Adjusted EBITDA, Adjusted EBITDA Margin, and Free Cash Flow, all non-GAAP financial measures (together the 鈥淣on-GAAP Measures鈥�), provide investors with additional useful information in evaluating our performance.

We calculate Adjusted Net Loss as net loss, adjusted to exclude: (1) stock-based compensation expense, (2) change in fair value of warrants and derivatives, (3) sales and use tax income, (4) restructuring charges related to reduction in force payments, (5) litigation expenses (consisting of legal and related fees for a specific proceeding that is outside of our ordinary course of business), (6) warehouse restructuring costs, (7) non-cash impairment of previously capitalized software and cloud computing implementation costs, (8) technology modernization costs, (9) gain on extinguishment of debt, and (10) other items (as defined below).

We calculate Adjusted Net Loss Margin by dividing Adjusted Net Loss for the period by Revenue for the period.

We calculate Adjusted Net Loss Per Common Share by dividing Adjusted Net Loss for the period by weighted average common shares used to compute net loss per share attributable to common stockholders for the period.

We calculate Adjusted EBITDA as net loss, adjusted to exclude: (1) interest income, (2) interest expense, (3) depreciation and amortization, (4) stock-based compensation expense, (5) change in fair value of warrants and derivatives, (6) capitalized cloud computing amortization, (7) sales and use tax income, (8) restructuring charges related to reduction in force payments, (9) litigation expenses (consisting of legal and related fees for a specific proceeding that is outside of our ordinary course of business), (10) warehouse restructuring costs, (11) non-cash impairment of previously capitalized software and cloud computing implementation costs, (12) technology modernization costs, (13) gain on extinguishment of debt, and (14) other items (as defined below).

We calculate Adjusted EBITDA Margin by dividing Adjusted EBITDA for the period by revenue for the period.

We calculate Free Cash Flow as net cash provided by (used in) operating activities less capital expenditures.

The Non-GAAP Measures are financial measures that are not required by, or presented in accordance with U.S. GAAP. We believe that the Non-GAAP Measures, when taken together with our financial results presented in accordance with U.S. GAAP, provides meaningful supplemental information regarding our operating performance and facilitates internal comparisons of our historical operating performance on a more consistent basis by excluding certain items that may not be indicative of our business, results of operations or outlook. In particular, we believe that the use of the Non-GAAP Measures are helpful to our investors as they are measures used by management in assessing the health of our business, determining incentive compensation and evaluating our operating performance, as well as for internal planning and forecasting purposes.

The Non-GAAP Measures are presented for supplemental informational purposes only, have limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with U.S. GAAP. Some of the limitations of the Non-GAAP Measures include that (1) the measures do not properly reflect capital commitments to be paid in the future, (2) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect these capital expenditures, (3) Adjusted EBITDA and Adjusted EBITDA Margin do not consider the impact of stock-based compensation expense, which is an ongoing expense for our company, (4) Adjusted EBITDA and Adjusted EBITDA Margin do not reflect other non-operating expenses, including interest expense. In addition, our use of the Non-GAAP Measures may not be comparable to similarly titled measures of other companies because they may not calculate the Non-GAAP Measures in the same manner, limiting their usefulness as a comparative measure. Because of these limitations, when evaluating our performance, you should consider the Non-GAAP Measures alongside other financial measures, including our net income (loss) and other results stated in accordance with U.S. GAAP, and (5) Free cash flow does not represent the total residual cash flow available for discretionary purposes and does not reflect our future contractual commitments.

The following table presents a reconciliation of Adjusted Net Loss to Net loss, the most directly comparable financial measure stated in accordance with U.S. GAAP, and the calculation of net loss margin, Adjusted Net Loss Margin and Adjusted Net Loss Per Common Share for the periods presented:

Adjusted Net Loss

The following table presents a reconciliation of Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with U.S. GAAP, and the calculation of net loss margin and Adjusted EBITDA margin for the periods presented:

Adjusted EBITDA

The following table presents a reconciliation of Free Cash Flow to Net cash used in operating activities, the most directly comparable financial measure prepared in accordance with U.S. GAAP, for each of the periods indicated:

Free Cash Flow

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Investors:

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Media:

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Source: BARK, Inc.