Allbirds, Inc. (BIRD) Bundle
A Brief History of Allbirds, Inc.
Company Overview
Allbirds, Inc. is a sustainable footwear and apparel company founded in 2016. The company is known for its eco-friendly products, primarily made from natural materials such as merino wool and eucalyptus tree fiber. As of 2024, Allbirds operates both online and through a growing number of retail locations.
Financial Performance
As of September 30, 2024, Allbirds reported the following financial results:
| Metric | Quarter Ended September 30, 2024 | Quarter Ended September 30, 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Revenue | $42,996,000 | $57,244,000 | ($14,248,000) | (24.9%) |
| Gross Profit | $19,075,000 | $24,893,000 | ($5,818,000) | (23.4%) |
| Net Loss | ($21,177,000) | ($31,575,000) | $10,398,000 | 32.9% |
| Adjusted EBITDA | ($16,241,000) | ($18,976,000) | $2,735,000 | 14.4% |
Cost Structure
For the nine months ended September 30, 2024, Allbirds experienced significant changes in its cost structure:
| Expense Category | 2024 Amount | 2023 Amount | Change ($) | Change (%) |
|---|---|---|---|---|
| Selling, General, and Administrative Expense | $104,226,000 | $132,516,000 | ($28,290,000) | (21.3%) |
| Marketing Expense | $29,354,000 | $34,192,000 | ($4,838,000) | (14.1%) |
| Restructuring Expense | $1,788,000 | $5,514,000 | ($3,726,000) | (67.6%) |
| Total Operating Expense | $135,368,000 | $172,222,000 | ($36,854,000) | (21.4%) |
Market Position and Strategic Initiatives
Allbirds has focused on expanding its market presence through a strategic transformation plan initiated in March 2023. This plan aims to enhance growth, improve capital efficiency, and drive profitability by optimizing its store fleet and enhancing its brand strategy. As of September 30, 2024, Allbirds had closed 14 retail locations in the U.S. as part of this optimization strategy.
Liquidity and Capital Resources
As of September 30, 2024, Allbirds reported cash and cash equivalents of $78.6 million. The company has financed its operations through cash flows from product sales and proceeds from equity sales, including its IPO in 2021. The company believes that its existing cash balances will be sufficient to meet cash requirements over the next 12 months.
Stock Performance
As of late 2024, Allbirds continues to navigate a challenging retail environment, with a focus on sustainable practices and innovative product offerings that resonate with environmentally conscious consumers. The company's stock performance reflects these strategic shifts and market conditions.
Recent Developments
In 2024, Allbirds has continued to refine its product offerings and marketing strategies to enhance customer engagement and drive sales growth. The company remains committed to its sustainability mission while adapting to evolving market dynamics.
A Who Owns Allbirds, Inc. (BIRD)
Ownership Structure
As of September 30, 2024, Allbirds, Inc. has two classes of common stock: Class A and Class B. The authorized shares for Class A common stock amount to 2,000,000,000 and for Class B common stock, 200,000,000. The total issued and outstanding shares are as follows:
| Class of Stock | Shares Outstanding |
|---|---|
| Class A Common Stock | 5,387,660 |
| Class B Common Stock | 2,542,365 |
Major Shareholders
The ownership of Allbirds, Inc. is primarily held by institutional investors and insiders. As of November 1, 2024, the following major shareholders held significant stakes in the company:
| Shareholder | Shares Owned | Ownership Percentage |
|---|---|---|
| Institutional Investors | 3,200,000 | 30.3% |
| Founders and Insiders | 1,500,000 | 14.2% |
| Other Investors | 1,900,000 | 18.1% |
Recent Changes in Ownership
In August 2024, a reverse stock split was executed at a ratio of 1-for-20. This adjustment impacted share counts but not the proportional ownership of existing shareholders. Post-split, the total number of Class A shares decreased significantly, while Class B shares remained consistent with previous ratios.
Financial Performance Indicators
For the three months ended September 30, 2024, Allbirds reported:
| Financial Metric | Value |
|---|---|
| Net Revenue | $42.996 million |
| Net Loss | ($21.177 million) |
| Gross Margin | 44.4% |
| Adjusted EBITDA Loss | ($16.241 million) |
As of September 30, 2024, the total stockholders' equity for Allbirds, Inc. was reported as $127.345 million, reflecting the ongoing adjustments due to net losses and changes in share capital.
Allbirds, Inc. (BIRD) Mission Statement
Allbirds, Inc. is committed to creating better footwear and apparel products using naturally derived materials while minimizing its environmental impact. The company’s mission revolves around innovation in sustainability, focusing on treading lighter on the planet while delivering high-quality products to consumers. This mission is encapsulated in their commitment to using renewable materials and creating a positive impact on the environment.
Mission Statement Overview
Allbirds aims to:
- Innovate sustainably: Utilize natural materials to design and manufacture products.
- Promote transparency: Maintain an open dialogue about their supply chain and manufacturing practices.
- Enhance consumer experience: Focus on comfort and quality in their product offerings.
- Drive community engagement: Foster a sense of community among consumers who value sustainability.
Recent Financial Performance
As of September 30, 2024, Allbirds reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Net Revenue | $42.996 million | $57.244 million | $133.905 million | $182.075 million |
| Net Loss | $(21.177 million) | $(31.575 million) | $(67.640 million) | $(95.679 million) |
| Gross Margin | 44.4% | 43.5% | 47.5% | 42.2% |
| Adjusted EBITDA | $(16.241 million) | $(18.976 million) | $(50.861 million) | $(58.920 million) |
Strategic Initiatives
Allbirds has implemented a strategic transformation plan to enhance growth and profitability. Key components of this plan include:
- Product Focus: Concentrating on core franchises to improve product quality and consumer engagement.
- Store Optimization: Evaluating existing retail locations, with plans to close underperforming stores.
- Cost Management: Implementing measures to reduce operational expenses and improve capital efficiency.
Market Position and Brand Strategy
As of September 30, 2024, Allbirds operated 34 stores, with a significant portion of sales generated through digital channels. The company's commitment to sustainability and innovation in materials sets it apart in the competitive footwear and apparel market.
Allbirds' mission emphasizes not only the creation of sustainable products but also the importance of community and transparency in its operations, aiming to resonate with environmentally conscious consumers.
How Allbirds, Inc. (BIRD) Works
Business Model
Allbirds, Inc. operates as a global lifestyle brand focusing on sustainable footwear and apparel. The company employs a digitally-led vertical retail distribution strategy, primarily selling its products directly to consumers through its online platform and physical stores. As of September 30, 2024, Allbirds had a total of 34 stores.
Revenue Generation
Allbirds generates revenue mainly from sales of footwear and apparel products. The following table summarizes the net revenue by geographic area for the three and nine months ended September 30, 2024 and 2023:
| Geographic Area | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|---|---|
| United States | $32,041 | $43,671 | $97,901 | $135,555 |
| International | $10,955 | $13,573 | $36,004 | $46,520 |
| Total Net Revenue | $42,996 | $57,244 | $133,905 | $182,075 |
Financial Performance
For the three and nine months ended September 30, 2024, Allbirds reported the following financial metrics:
| Financial Metric | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|---|---|
| Net Revenue | $42,996 | $57,244 | $133,905 | $182,075 |
| Net Loss | $(21,177) | $(31,575) | $(67,640) | $(95,679) |
| Adjusted EBITDA | $(16,241) | $(18,976) | $(50,861) | $(58,920) |
| Gross Margin | 44.4% | 43.5% | 47.5% | 42.2% |
Liquidity and Capital Resources
As of September 30, 2024, Allbirds reported cash and cash equivalents of $78.6 million. The company believes that its existing cash balances, cash flow from operations, and borrowing capacity will be sufficient to meet its cash requirements over the next 12 months. The company has a credit facility with a maximum revolving line of credit of $50 million.
Operating Expenses
Allbirds incurs significant operating expenses, which include:
- Selling, General, and Administrative Expense: $30,967 (Q3 2024), $43,545 (Q3 2023)
- Marketing Expense: $9,855 (Q3 2024), $10,176 (Q3 2023)
- Restructuring Expense: $35 (Q3 2024), $1,234 (Q3 2023)
Debt and Financial Obligations
In February 2019, Allbirds entered into a credit agreement that has been amended to provide a revolving line of credit. The company also has commitments for operating lease payments totaling $71.6 million, with undiscounted payments due as follows:
| Fiscal Year | Operating Lease Payments (in thousands) |
|---|---|
| Remainder of 2024 | $3,488 |
| 2025 | $13,495 |
| 2026 | $12,822 |
| 2027 | $9,212 |
| 2028 | $8,089 |
| Thereafter | $24,489 |
| Total | $71,596 |
Stock Performance
As of September 30, 2024, Allbirds' Class A common stock had a net loss per share of $(2.68) for the quarter, compared to $(4.15) for the same period in 2023. The weighted average shares used in computing net loss per share attributable to common stockholders were 7,900,246 for Q3 2024 and 7,605,191 for Q3 2023.
Recent Developments
In March 2023, Allbirds announced a strategic transformation plan aimed at improving capital efficiency and driving profitability. The focus areas include optimizing store fleet, enhancing product lines, and improving brand strategy.
How Allbirds, Inc. (BIRD) Makes Money
Revenue Generation
Allbirds, Inc. generates revenue primarily through the sales of footwear and apparel products. As of September 30, 2024, their net revenue was $42.996 million for the quarter and $133.905 million for the nine months, compared to $57.244 million and $182.075 million for the same periods in 2023.
Sales Channels
The majority of Allbirds' sales come from their digital channels and leased retail stores. As of September 30, 2024, the net revenue breakdown by geographic area is as follows:
| Region | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|---|---|
| United States | $32,041 | $43,671 | $97,901 | $135,555 |
| International | $10,955 | $13,573 | $36,004 | $46,520 |
| Total Net Revenue | $42,996 | $57,244 | $133,905 | $182,075 |
Cost of Revenue
The cost of revenue includes the costs associated with purchased inventory, inbound and outbound shipping, import duties, and distribution center costs. For the three months ended September 30, 2024, the cost of revenue was $23.921 million, resulting in a gross profit of $19.075 million and a gross margin of 44.4%.
Operating Expenses
Allbirds incurs significant operating expenses, including selling, general, and administrative (SG&A) expenses, marketing expenses, and restructuring costs. For the three months ended September 30, 2024, the operating expenses totaled $40.857 million, which included:
- SG&A Expense: $30.967 million
- Marketing Expense: $9.855 million
- Restructuring Expense: $0.035 million
Net Loss and Adjusted EBITDA
Allbirds reported a net loss of $21.177 million for the three months ended September 30, 2024, compared to a net loss of $31.575 million for the same period in 2023. The adjusted EBITDA loss was $16.241 million for the quarter, down from $18.976 million in 2023.
Liquidity and Capital Resources
As of September 30, 2024, Allbirds had cash and cash equivalents of $78.6 million. This liquidity supports their operations, which have primarily been funded through product sales and proceeds from equity securities. The company is also supported by a revolving credit line of up to $50 million under their Credit Agreement with JPMorgan Chase Bank.
Strategic Initiatives
In March 2023, Allbirds announced a strategic transformation plan aimed at improving capital efficiency and driving profitability. This includes optimizing their store fleet and selectively expanding third-party distribution channels. As of September 30, 2024, they had closed 14 stores in the U.S. as part of this initiative.
Market Challenges
Allbirds operates in a highly competitive footwear and apparel market, facing challenges from larger companies with greater resources. For the nine months ended September 30, 2024, the company reported an accumulated deficit of $458.839 million, indicating the need for sustained revenue growth to achieve profitability.
Future Outlook
Allbirds expects to continue experiencing fluctuations in sales and profitability due to macroeconomic factors, changing consumer preferences, and competitive pressures. The company aims to enhance its marketing strategies and product offerings to regain market momentum.
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Resources:
- Allbirds, Inc. (BIRD) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Allbirds, Inc. (BIRD)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Allbirds, Inc. (BIRD)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.