Overstock.com’s revenue climbs 18% in Q4
January 29, 2015 12:27 PM
More shoppers flocked to Overstock.com Inc., No. 31 in the Internet Retailer 2014 Top 500 Guide, in the fourth quarter of 2014, and they spent more per order, according to the discount online retailer’s earnings report released Thursday.
The number of orders increased 12% and the average order size grew 7%, to $159 from $149 in the same quarter in 2013, but these gains were partially offset by an increase in product returns, the Salt Lake City, Utah-based company reported.
Overstock.com’s 18% quarterly revenue growth is in line with growth in e-commerce as a whole; e-retail sales increased 16% in the first nine months of 2014, according to the U.S. Commerce Department, which reports Q4 results in February. Several estimates of online holiday sales put growth in the range of 14-17% for November and December 2014.
Despite beating revenue projections, a 19% jump in spending on marketing and sales contributed to Overstock.com missing its Q4 earnings expectations of $2.84 per share by a wide margin, coming in at 6 cents per share.
Overstock.com plans to expand its Club O rewards program, which accounts for 20% of the site’s sales, CEO Patrick Byrne said Thursday during the company’s conference call on earnings.
The company’s growth strategy includes expanding international sales and distribution. Byrne said Overstock.com plans to open its first warehouse in China during the second quarter.
Also on the online retailer’s agenda in the coming months: a video-on-demand service that would have about 30,000 titles. Byrne announced the streaming video plans Tuesday at the National Association of Television Program Executives conference and touched on it again Thursday with investors.
Byrne also touted the online retailer’s improvements in internal search technology. “Technology is no longer the bane of my existence,” he said.” Technology is our friend.”
For the quarter ended Dec. 31, Overstock reported:
- $470.4 million in total revenue during the quarter, an 18.3% increase from $397.6 million in the same quarter of 2013.
- $1.3 million in net income during the quarter, a 98.1% decrease from $69.5 million in the same quarter of 2013
- $37.1 million in sales and marketing expenses, an 18.9% increase from $31.2 million in the year-ago quarter
For fiscal year 2014, Overstock.com also reported:
- $1.47 billion in total revenue for the year, a 13.1% increase from $1.30 billion in 2013
- $8.8 million in net income for the fiscal 2014, an 89.6% decrease from $84.4 million in 2013
- $109.5 million in sales and marketing expenses, a 19.5% increase from $91.6 million in 2013