Blue Apron to Start Selling Meal Kits at Costco, Announces First Quarter 2018 Results
NEW YORK, NY - In an attempt to rally its customer support and expand its footprint, Blue Apron announced this week it is launching a pilot program with Costco—the first retailer named after revealing last March it was eyeing brick and mortar as an avenue to sell its meal kits. The meal kit provider also reported its first-quarter earnings with results on the up-and-up, providing a possible better outlook for 2018.
“We are pleased with the progress we achieved this quarter, including significant improvement in operational efficiencies as reflected by our margin performance, which was the strongest we have seen since the second quarter of 2016,” said Blue Apron’s Chief Operating Officer Brad Dickerson. “We also improved our customer metrics as we began to methodically reaccelerate marketing late last year, with a specific focus on attracting new customers with high affinity as well as deepening our engagement with current customers.”
According to a company press release, Blue Apron’s first quarter 2018 financial results are as follows:
- While net revenue decreased 20 percent year-over-year to $196.7 million in the first quarter of 2018 compared to the first quarter of 2017 due to the decrease in Customers and Orders following the deliberate pull back in marketing spend in the second half of 2017, net revenue increased 5 percent quarter-over-quarter, reflecting Blue Apron’s methodical reacceleration of its marketing efforts and advanced product merchandizing capabilities
- Thanks to the benefits of enhanced planning and process-driven strategies in fulfillment center operations, cost of goods sold as a percentage of net revenue improved 310 basis points year-over-year from 68.8 percent to 65.8 percent and improved 430 basis points from the fourth quarter of 2017
- In this past quarter, Blue Apron methodically reaccelerated marketing efforts with a focus on building efficient and sustainable growth. In the first quarter of 2018, marketing expense was $39.3 million, or 20 percent of net revenue, compared to $60.6 million, or 24.8 percent of net revenue, in the first quarter of 2017
- Net loss was $(31.7) million and diluted loss per share was $(0.17) in the first quarter of 2018 based on 191.5 million weighted average common shares outstanding, compared to net loss of $(52.2) million and diluted loss per share of $(0.78) in the first quarter of 2017 based on 67.1 million weighted average common shares outstanding. Sequentially, net loss improved $7.5 million quarter-over-quarter from a net loss of $(39.1) million in the fourth quarter of 2017
“We look forward to building on this momentum as we continue to optimize our direct-to-consumer business, create new products that complement our core offering, and leverage new distribution channels—including our newly launched pilot program with Costco—to expand the reach of our strong brand to more households across the country,” Dickerson continued.
For the full results of Blue Apron’s first quarter of 2018, click here.
Will more retailers follow Costco’s lead and pick up Blue Apron’s meal kits as part of its store offerings? AndNowUKnow will continue to report as the story unfolds.