Pet products provider Bark (NYSE: BARK) missed Wall Street’s revenue expectations in Q1 CY2025, with sales falling 5% year on year to $115.4 million. Next quarter’s revenue guidance of $100 million underwhelmed, coming in 21.6% below analysts’ estimates. Its non-GAAP profit of $0.01 per share was in line with analysts’ consensus estimates.
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Bark (BARK) Q1 CY2025 Highlights:
- Revenue: $115.4 million vs analyst estimates of $128.2 million (5% year-on-year decline, 9.9% miss)
- Adjusted EPS: $0.01 vs analyst estimates of $0 (in line)
- Adjusted EBITDA: $5.23 million vs analyst estimates of $3.08 million (4.5% margin, 69.5% beat)
- Revenue Guidance for Q2 CY2025 is $100 million at the midpoint, below analyst estimates of $127.5 million
- EBITDA guidance for Q2 CY2025 is $0 at the midpoint, below analyst estimates of $1.21 million
- Operating Margin: -5.7%, in line with the same quarter last year
- Free Cash Flow was -$11.99 million compared to -$3.17 million in the same quarter last year
- Market Capitalization: $229.1 million
Company Overview
Making a name for itself with the BarkBox, Bark (NYSE: BARK) specializes in subscription-based, personalized pet products.
Sales Growth
A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, Bark grew its sales at a decent 16.6% compounded annual growth rate. Its growth was slightly above the average consumer discretionary company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. Bark’s recent performance marks a sharp pivot from its five-year trend as its revenue has shown annualized declines of 4.9% over the last two years.
This quarter, Bark missed Wall Street’s estimates and reported a rather uninspiring 5% year-on-year revenue decline, generating $115.4 million of revenue. Company management is currently guiding for a 14% year-on-year decline in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 10.9% over the next 12 months. Although this projection indicates its newer products and services will fuel better top-line performance, it is still below average for the sector.
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Operating Margin
Bark’s operating margin has risen over the last 12 months, but it still averaged negative 8.3% over the last two years. This is due to its large expense base and inefficient cost structure.
In Q1, Bark generated a negative 5.7% operating margin. The company's consistent lack of profits raise a flag.
Earnings Per Share
We track the change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Although Bark’s full-year earnings are still negative, it reduced its losses and improved its EPS by 100% annually over the last three years. The next few quarters will be critical for assessing its long-term profitability.
In Q1, Bark reported EPS at $0.01, up from $0 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street is optimistic. Analysts forecast Bark’s full-year EPS of negative $0.02 will reach break even.
Key Takeaways from Bark’s Q1 Results
We were impressed by how significantly Bark blew past analysts’ EBITDA expectations this quarter. On the other hand, its revenue missed, and its revenue and EBITDA guidance for next quarter fell short of Wall Street’s estimates. Overall, this was a softer quarter. The stock traded down 12.9% to $1.18 immediately after reporting.
Bark’s latest earnings report disappointed. One quarter doesn’t define a company’s quality, so let’s explore whether the stock is a buy at the current price. When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.
