BARK sees in consumables an opportunity for growth

BARK’s FY 2023 ended on March 31 and recorded a revenue of $535.3 million (€‎496.5M). BARK stated this is a 5.5% increase year-over-year. At the end of the last financial year, they recorded $507.4 million (€‎470.6M).

Gross profit hit $308.1 million (€285.7M), up 9% compared to FY 2022 at $282.1 million (€261.7M).

The main earners

Matt Meeker, Co-Founder, CEO & Executive Chairman, says that in FY 2023, the company “generated approximately $307 million (€284.7M) from toys and accessories such as beds, apparel and other essentials.” 

Consumables such as treats, food, toppers and dental products accounted for $165 million (€153M).

Total revenue for the last quarter exceeded expectations reaching $126 million (€116.9M), $5 million (€4.6M) higher than BARK’s original guidance prediction. During the same period in 2022, sales accounted for $128.8 million (€119.5M).

Despite exceeding guidance, Q4 was down slightly by -2% compared to 2022, says Chief Financial Officer (CFO) Zahir M. Ibrahim. He notes that commerce revenue declined by 9.3% for the quarter. 

Retail outlets 

Currently, 30.8% of the company’s yearly revenue comes from consumables. The firm believes these products are a “big opportunity for expansion” and says they plan to focus on them as they proved to be a big earner.

The company will prioritize its direct-to-consumer (DTC) e-commerce and subscription business, as these areas have allowed them to “establish relationships and a strong brand with millions of customers.”

Meeker also announced that they plan to expand the availability of treats and other consumable products to 40,000 retail outlets, a channel where the brand is not yet present.

Seeking Alpha notes that their choice to focus on consumable products “should be a major growth driver.” 

Positive feedback

The earnings release generated positive feedback among stakeholders.

Seeking Alpha writes that despite investors’ “lack of confidence” in special purpose acquisition companies (SPAC) such as BARK, the firm has solid products and has shown a positive turn in its finances. 

SPAC companies have become a preferred way for many experienced management teams and sponsors to take companies public. Such companies work by raising capital via an initial public offering (IPO) to acquire an existing company.

Management teams and sponsors can then take their SPAC companies public.