Online mass merchandise retailer Overstock.com is reporting sharply higher sales and a smaller net loss for the second quarter. Sales rose by 26.7% and the company’s net loss improved by 52.9%.
Online mass merchandise retailer Overstock.com Inc. is reporting sharply higher sales and a smaller net loss for the second quarter.
For the quarter, Overstock posted a net loss of $6.5 million on revenue of $188.8 million compared with a net loss of $13.8 million on sales of $149 million in the prior year. Sales rose by 26.7% and the company’s net loss improved by 52.9%.
Overstock, No. 30 in the Internet Retailer Top 500 Guide, also reported a net loss of $10.4 million on revenue of $390 million for the first six months of the year vs. a net loss of $35.1 million on sales of $306.9 million in the first and second quarter of 2007.
“For the first time in its history the business has generated four consecutive quarters of positive operating cash flows,” says Overstock CEO Patrick Byrne. “We ended Q2 with $87 million in cash, having bought in $12 million of stock earlier in 2008. Our financial condition is sound despite a weak economy.”
In the quarter Overstock spent $15.2 million – 8% of sales – on technology and $8 million, or 4% of revenue, on sales and marketing. For the quarter ended June 30, Overstock also spent 6% of sales - $10.4 million – on general and administrative expenses. “Our technology and general and administrative expenses are under control, even though we are doing more basic projects than we ever have in the past,” says Byrne. “Some of these are directed to better inventory purchasing and handling, some will benefit our web site, and some are long term projects, such as the housing tab that went live this quarter.”
Overstock also acquired 500,000 new customers in the second quarter, Byrne says. “While this is primarily attributable to our marketing efforts, we feel that this is also an indication that the current economic climate is driving more people to discount shopping,” he says.