• 1stDibs Reports Fourth Quarter and Full Year 2022 Financial Results

    ソース: Nasdaq GlobeNewswire / 01 3 2023 07:00:02   America/New_York

    NEW YORK, March 01, 2023 (GLOBE NEWSWIRE) -- 1stdibs.com, Inc. (NASDAQ: DIBS), a leading online marketplace for luxury design products ("1stDibs" or the "Company"), today reported financial results for its fourth quarter and full year ended December 31, 2022.

    Fourth Quarter 2022 Financial Highlights

    • Net revenue was $23.0 million, a decrease of 15% year-over-year.
    • Gross profit was $16.2 million, a decrease of 3% year-over-year.
    • Gross margin was 70.5%, compared to 61.7% in the fourth quarter 2021.
    • GAAP net loss was $6.9 million compared to a net loss of $8.1 million in the fourth quarter 2021.
    • Non-GAAP Adjusted EBITDA and Adjusted EBITDA Margin was $(4.5) million and (19.5)%, respectively, compared to $(6.7) million and (25.0)%, respectively, in the fourth quarter 2021.
    • Cash and cash equivalents totaled $153.2 million as of December 31, 2022.

    Full Year 2022 Financial Highlights

    • Net revenue was $96.8 million, a decrease of 6% year-over-year.
    • Gross profit was $67.2 million, a decrease of 5% year-over-year.
    • Gross margin was 69.4%, compared to 68.7% in the year ended December 31, 2021.
    • GAAP net loss was $22.5 million, compared to $21.0 million in the year ended December 31, 2021.
    • Non-GAAP Adjusted EBITDA and Adjusted EBITDA Margin was $(20.7) million and (21.3)%, respectively, compared to $(16.5) million and (16.1)%, respectively, in the year ended December 31, 2021.
    • On June 29, 2022, the Company sold 100% of its equity interest in Design Manager for a purchase price of $14.8 million and recorded a net gain on the sale of $9.7 million.
    • In September 2022, the Company announced and implemented a restructuring plan to reduce operational costs and realign investment priorities involving the reduction of approximately 10% of the Company’s workforce. As a result of the reduction, we incurred approximately $0.7 million in non-recurring restructuring charges.

    “In 2022, despite a challenging environment for e-commerce, we made significant progress on our strategic priorities, primarily Auctions, international expansion, supply growth and improving our cost structure,” said David Rosenblatt, 1stDibs Chief Executive Officer.

    Tom Etergino, Chief Financial Officer of 1stDibs said, “We delivered our second quarter of sequential adjusted EBITDA margin improvement, driven by expense reductions. In 2023 we will remain focused on improving efficiency while also making selective investments in areas of the business showing strong potential, like Auctions and international expansion.”

    Other Recent Business Highlights and Fourth Quarter Key Operating Metrics

    • GMV was $104 million, a decrease of 11% year-over-year.
    • Number of Orders was approximately 38K, a decrease of 5% year-over-year.
    • Active Buyers was approximately 68K, a decrease of 7% year-over-year.

    Financial Guidance and Outlook

    The Company’s first quarter 2023 guidance is below.

     Q1 2023 Guidance
    GMV$93 million - $100 million
    Net revenue$21.4 million - $22.5 million
    Adjusted EBITDA margin (non-GAAP)(29%) - (24%)


    Actual results may differ materially from our Financial Guidance and Outlook as a result of, among other things, the factors described under “Forward-Looking Statements” below.

    A GAAP reconciliation to our non-GAAP guidance measure (adjusted EBITDA) is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. Stock-based compensation expense is impacted by the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to change. We have provided a reconciliation of GAAP to non-GAAP financial measures in the financial statement tables for our historical non-GAAP financial results included in this press release.

    Webcast Information

    1stDibs will host a webcast to discuss its fourth quarter and full year 2022 financial results today at 8:00 a.m. Eastern Time. Investors and participants can access the webcast at the 1stDibs Investor Relations website (investors.1stdibs.com). A replay of the webcast will be available through the same link following the webcast, for one year thereafter.

    Disclosure Information

    In compliance with disclosure obligations under Regulation FD, 1stDibs announces material information to the public through a variety of means, including filings with the Securities and Exchange Commission, press releases, company blog posts, public conference calls and webcasts, as well as the investor relations website.

    About 1stDibs

    1stDibs is a leading online marketplace for connecting design lovers with highly coveted sellers and makers of vintage, antique, and contemporary furniture, home décor, art, jewelry, watches and fashion.

    Media Contact:

    Jennifer Miller

    jennifer.miller@1stdibs.com

    Investor Relations Contact:

    Kevin LaBuz

    investors@1stdibs.com
    Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of federal and state securities laws. All statements in this press release other than statements of historical fact may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as: "accelerate," "anticipate," "believe," "can," "contemplate," "continue," "could," "demand," "estimate," "expand," "expect," "focus," "intend," "may," "might," "objective," "ongoing," "opportunity," "outlook," "plan," "potential," "predict," "progress," "project," "should," "target," "will," "would," or the negative of these terms, or other comparable terminology or similar expressions intended to identify statements about the future.

    These forward-looking statements include, but are not limited to, statements regarding the following: (1) our continued efforts to lay the foundation for future growth; (2) our focus on efficiency and steps to align our expenses to current demand and the impact thereof; and (3) our future results of operations and financial position, including our financial guidance and outlook. We cannot guarantee that any forward-looking statement will be accurate. Forward-looking statements are based on current of future events and if these prove to be inaccurate, actual results could vary materially from our expectations and projections. Investors are therefore cautioned not to place undue reliance on any forward-looking statements. These forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to vary materially from those discussed or implied in the forward-looking statements. These risks and uncertainties include but are not limited to the following: (1) our ability to execute our business plan and strategies to achieve our strategic initiatives; (2) our ability to achieve future growth; (3) risks related to our evaluation of multiple alternatives, including the outcome, if any, of such evaluation process, and market perception of, or reaction to, the foregoing; (4) our ability to enhance GMV growth and shareholder value; (5) our ability to effectively manage costs; and (6) macroeconomic conditions or geopolitical events or similar risks, as well as other risks, uncertainties, and other factors discussed in our filings with the Securities and Exchange Commission (the “SEC”), including our Form 10-K for the year ended December 31, 2021, our Forms 10-Q for the quarters ended March 31, 2022, June 30, 2022, and September 30, 2022, and other periodic reports and filings we make with the SEC. We qualify all of our forward-looking statements by these cautionary statements. These forward-looking statements speak only as of the date of this press release and we undertake no obligation to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, or otherwise, except as required by law.

    Key Operating Metrics Definitions

    Gross Merchandise Value

    We define GMV as the total dollar value from items sold by our sellers through 1stDibs in a given month, minus cancellations within that month, and excluding shipping and sales taxes. GMV includes all sales reported to us by our sellers, whether transacted through the 1stDibs marketplace or reported as an offline sale. We view GMV as a measure of the total economic activity generated by our online marketplace, and as an indicator of the scale and growth of our online marketplace and the health of our ecosystem. Our historical growth rates for GMV may not be indicative of future growth rates in GMV.

    Number of Orders

    We define Number of Orders as the total number of orders placed or reported through the 1stDibs marketplace in a given month, minus cancellations within that month. Our historical growth rates for Number of Orders may not be indicative of future growth rates in Number of Orders.

    Active Buyers

    We define Active Buyers as buyers who have made at least one purchase through our online marketplace during the 12 months ended on the last day of the period presented, net of cancellations. A buyer is identified by a unique email address; thus an Active Buyer could have more than one account if they were to use a separate unique email address to set up each account. We believe this metric reflects scale, engagement and brand awareness, and our ability to convert user activity on our online marketplace into transactions. Our historical growth rates for Active Buyers may not be indicative of future growth rates in new Active Buyers.



    1STDIBS.COM, INC.
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (Amounts in thousands, except share and per share amounts)
    (Unaudited)

     December 31, 2022 December 31, 2021
    Assets   
    Current assets:   
    Cash and cash equivalents$153,209  $168,226 
    Restricted cash, current 1,500    
    Accounts receivable, net of allowance for doubtful accounts of $113 and $29 at December 31, 2022 and December 31, 2021, respectively 972   701 
    Prepaid expenses 3,506   3,951 
    Receivables from payment processors 2,476   2,142 
    Other current assets 800   867 
    Total current assets 162,463   175,887 
    Restricted cash, non-current 3,334   3,333 
    Property and equipment, net 3,685   4,459 
    Operating lease right-of-use assets 21,990    
    Goodwill 4,075   7,202 
    Intangible assets, net 3   1,164 
    Other assets 246   209 
    Total assets$195,796  $192,254 
    Liabilities and Stockholders’ Equity   
    Current liabilities:   
    Accounts payable$2,905  $4,729 
    Payables due to sellers 7,185   10,225 
    Accrued expenses 10,761   13,745 
    Operating lease liabilities, current 2,770    
    Other current liabilities 2,429   3,512 
    Total current liabilities 26,050   32,211 
    Operating lease liabilities, non-current 21,678    
    Other liabilities 46   2,605 
    Total liabilities 47,774   34,816 
    Commitments and contingencies   
    Stockholders’ equity:   
    Preferred stock, $0.01 par value; 10,000,000 shares authorized as of December 31, 2022 and December 31, 2021; zero shares issued and outstanding as of December 31, 2022 and December 31, 2021     
    Common stock, $0.01 par value; 400,000,000 shares authorized as of December 31, 2022 and December 31, 2021; 39,260,193 and 38,000,086 shares issued as of December 31, 2022 and December 31, 2021, respectively; and 39,260,193 and 37,991,529 shares outstanding as of December 31, 2022 and December 31, 2021, respectively 393   380 
    Additional paid-in capital 439,005   425,769 
    Accumulated deficit (291,020)  (268,482)
    Accumulated other comprehensive loss (356)  (229)
    Total stockholders’ equity 148,022   157,438 
    Total liabilities and stockholders’ equity$195,796  $192,254 



    1STDIBS.COM, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (Amounts in thousands, except share and per share amounts)
    (Unaudited)

     Three Months Ended December 31, Year Ended December 31,
     2022   2021   2022   2021 
    Net revenue$22,957  $26,930  $96,849  $102,731 
    Cost of revenue 6,762   10,306   29,670   32,167 
    Gross profit 16,195   16,624   67,179   70,564 
    Operating expenses:       
    Sales and marketing 10,637   11,762   44,776   47,414 
    Technology development 5,726   5,849   24,437   19,110 
    General and administrative 6,959   6,064   27,594   21,293 
    Provision for transaction losses 1,501   1,405   5,933   5,191 
    Gain on sale of Design Manager       (9,684)   
    Total operating expenses 24,823   25,080   93,056   93,008 
    Loss from operations (8,628)  (8,456)  (25,877)  (22,444)
    Other income (expense), net:       
    Interest income 860   54   1,606   146 
    Interest expense    (4)  (11)  (16)
    Other, net 944   340   1,781   1,372 
    Total other income (expense), net 1,804   390   3,376   1,502 
    Net loss before income taxes (6,824)  (8,066)  (22,501)  (20,942)
    Provision for income taxes (37)  (21)  (37)  (21)
    Net loss (6,861)  (8,087)  (22,538)  (20,963)
    Accretion of redeemable convertible preferred stock to redemption value          (7,061)
    Net loss attributable to common stockholders$(6,861) $(8,087) $(22,538) $(28,024)
    Net loss per share attributable to common stockholders—basic and diluted$(0.18) $(0.21) $(0.59) $(1.08)
    Weighted average common shares outstanding—basic and diluted 39,035,706   37,908,878   38,479,437   26,059,744 



    1STDIBS.COM, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (Amounts in thousands)
    (Unaudited)

     Year Ended December 31,
      2022   2021 
    Cash flows from operating activities:   
    Net loss$(22,538) $(20,963)
    Adjustments to reconcile net loss to net cash used in operating activities:   
    Depreciation and amortization 2,710   3,112 
    Stock-based compensation expense 11,214   2,839 
    Change in fair value of deferred acquisition consideration    427 
    Provision for transaction losses and e-commerce returns 781   701 
    Amortization of costs to obtain revenue contracts 310   447 
    Amortization of operating lease right-of-use assets 2,541    
    Deferred rent    (194)
    Gain on sale of Design Manager (9,684)   
    Other, net 195   21 
    Changes in operating assets and liabilities:   
    Accounts receivable (497)  52 
    Prepaid expenses and other current assets 31   (1,418)
    Receivables from payment processors (323)  910 
    Other assets (615)  (145)
    Accounts payable and accrued expenses (5,206)  5,055 
    Payables due to sellers (3,041)  5,732 
    Operating lease liabilities (2,735)   
    Other current liabilities and other liabilities (1,057)  (977)
    Net cash used in operating activities (27,914)  (4,401)
    Cash flows from investing activities:   
    Development of internal-use software (1,871)  (2,110)
    Purchases of property and equipment (93)  (129)
    Proceeds from sale of Design Manager 14,611    
    Other, net (6)  (30)
    Net cash provided by (used in) investing activities 12,641   (2,269)
    Cash flows from financing activities:   
    Proceeds from issuance of common stock in initial public offering, net of underwriting discounts and commissions    122,993 
    Proceeds from exercise of stock options 2,035   2,729 
    Payment of deferred acquisition consideration    (640)
    Payment of deferred offering costs    (5,032)
    Net cash provided by financing activities 2,035   120,050 
    Effect of exchange rate changes on cash, cash equivalents, and restricted cash (278)  (16)
    Net (decrease) increase in cash, cash equivalents, and restricted cash (13,516)  113,364 
    Cash, cash equivalents, and restricted cash at beginning of the period 171,559   58,195 
    Cash, cash equivalents, and restricted cash at end of the period$158,043  $171,559 

    Non-GAAP Financial Measures

    Adjusted EBITDA and Adjusted EBITDA Margin

    In this press release, we provide Adjusted EBITDA, a non-GAAP financial measure that represents our net loss adjusted to exclude: (1) depreciation and amortization; (2) stock-based compensation expense; (3) other income (expense), net; (4) provision for income taxes; (5) gain on sale of Design Manager; (6) one-time expenses related to the sale of Design Manager; and (7) restructuring charges. We also provide Adjusted EBITDA Margin, a non-GAAP financial measure that presents Adjusted EBITDA divided by net revenue. Below is a reconciliation of net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA.

    We have included Adjusted EBITDA and Adjusted EBITDA Margin, which are non-GAAP financial measures, because they are key measures used by our management team to help us to assess our operating performance and the operating leverage in our business. We also use these measures to analyze our financial results, establish budgets and operational goals for managing our business, and make strategic decisions. We believe that Adjusted EBITDA and Adjusted EBITDA Margin help identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses that we exclude from Adjusted EBITDA and Adjusted EBITDA Margin. Accordingly, we believe that these metrics provide useful information to investors and others in understanding and evaluating our results of operations, enhances the overall understanding of our past performance and future prospects, and allows for greater transparency with respect to key financial metrics used by our management in their financial and operational decision-making. We also believe that the presentation of these non-GAAP financial measures provides an additional tool for investors to use in comparing our core business and results of operations over multiple periods with other companies in our industry, many of which present similar non-GAAP financial measures to investors, and to analyze our cash performance.

    The non-GAAP financial measures presented may not be comparable to similarly titled measures reported by other companies due to differences in the way that these measures are calculated. The non-GAAP financial measures presented should not be considered as the sole measure of our performance and should not be considered in isolation from, or as a substitute for, comparable financial measures calculated in accordance with GAAP. Further, these non-GAAP financial measures have certain limitations in that they do not include the impact of certain expenses that are reflected in our consolidated statements of operations. Accordingly, these non-GAAP financial measures should be considered as supplemental in nature, and are not intended, and should not be construed, as a substitute for the related financial information calculated in accordance with GAAP. These limitations of Adjusted EBITDA and Adjusted EBITDA Margin include the following:

    • The exclusion of certain recurring, non-cash charges, such as depreciation of property and equipment and amortization of intangible assets. While these are non-cash charges, we may need to replace the assets being depreciated and amortized in the future and Adjusted EBITDA does not reflect cash requirements for these replacements or new capital expenditure requirements;
    • The exclusion of other income (expense), net, which includes interest income related to our cash equivalents, interest expense, and realized and unrealized gains and losses on foreign currency exchange; and
    • The exclusion of stock-based compensation expense, which has been a significant recurring expense and will continue to constitute a significant recurring expense for the foreseeable future, as equity awards are expected to continue to be an important component of our compensation strategy.
    • The exclusion of gain on sale of Design Manager, which is a one time sale of our wholly owned subsidiary, as well as the related one-time expenses to sell the subsidiary which include primarily legal fees.
    • The exclusion of restructuring charges, which are expenses from non-recurring employee severance and benefits costs.

    Because of these limitations, you should consider Adjusted EBITDA and Adjusted EBITDA Margin alongside other financial performance measures, including net loss and our other GAAP results. The information in the tables below sets forth the non-GAAP financial measures along with the most directly comparable GAAP financial measures.


    1STDIBS.COM, INC.
    Reconciliation of Net Loss to Adjusted EBITDA
    (Amounts in thousands)
    (Unaudited)

     Three Months Ended December 31, Year Ended December 31,
      2022   2021   2022   2021 
    Net loss$(6,861) $(8,087) $(22,538) $(20,963)
    Excluding:       
    Depreciation and amortization 521   713   2,710   3,112 
    Stock-based compensation expense 3,552   1,008   11,214   2,839 
    Other income, net (1,804)  (390)  (3,376)  (1,502)
    Provision for income taxes 37   21   37   21 
    Gain on sale of Design Manager       (9,684)   
    One-time expenses related to sale of Design Manger       307    
    Restructuring charges 80      660    
    Adjusted EBITDA (non-GAAP)$(4,475) $(6,735) $(20,670) $(16,493)
    Divided by:       
    Net revenue$22,957  $26,930  $96,849  $102,731 
    Adjusted EBITDA Margin (non-GAAP) (19.5)%  (25.0)%  (21.3)%  (16.1)%


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