That is a stark reversal from recent trends, and net losses should come in at no more than $6 million, down from the $7.7 million loss reported last year. Management is guiding for the second quarter to deliver year-over-year sales growth in the high single-digit range, or approximately $130 million of revenue. However, the pandemic gives Blue Apron a unique opportunity to attract new diners that might stay with the service once the crisis passes.ĬEO Linda Findley Kozlowski says the quarter's results still represent a jumping-off point for growth. Blue Apron is now building out its costs again, increasing capacity, hiring more staff, and narrowing menu selection even further to streamline fulfillment. The company has purposely reduced the amount of money it spends on marketing, having made the conscious decision to operate at a smaller scale that served its loyal customers who spend the most with the company rather than trying to grow.
Customer churn is high and whenever it reduces marketing, subscriber counts fall. The company increased its marketing spend during the quarter to $15 million, or 14.8% of net revenue, compared to $14.2 million, or just 10% of net revenue, in the year-ago period.īlue Apron is able to attract a lot of customers when it advertises its service, but the acquisition costs are expensive and unsustainable. Such measures should have served as a strong tailwind for Blue Apron, which management also thought would be the case. The market expected more from the latest report, as the stock had surged 500% from year-to-date lows as the stay-at-home orders rolled out across the U.S., and restaurants were forced to close unless they offered takeout or delivery. Data source: Blue Apron quarterly SEC filings.
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