NEW YORK — Casper revenue declined 3.3% in the third quarter ended Sept. 30, but its net loss improved 31.1% for the period.
Casper revenue hit $123.5 million for the quarter, driven primarily by direct-to-consumer revenue, which decreased 11.4% to $89.9 million only partially offset by a retail partnership revenue increase of 28.3% to $33.6 million.
Meanwhile, the company cut its net loss by 31.1%, coming in at a loss of $15.9 million for the period, compared with $23 million for the year ago period.
“We saw record interest for our products evidenced by record website traffic, continued to drive gross margin expansion and progress towards profitability, and had another sequential quarter of growth,” said Philip Krim, CEO. “However, our top-line growth was disappointing based on the initial demand signals.
“Challenges in our supply chain, including industry-wide shortages in textiles and chemicals critical to foam production, led to significant out-of-stock inventory both in our direct-to-consumer and retail partnership channels. Many of our core mattresses were out of stock on our website for weeks at time, and we were unable to monetize the full demand from retail partners leading to cancelled orders.”
Krim noted that the company has been addressing supply chain challenges by on-boarding what it calls Tier 1 and Tier 2 suppliers, as well as building in redundancies in the supply chair for improved inventory planning and increasing its in-stock position.
Since the temporary closure of its retail stores in North America in mid-March, Casper has reopened all its 66 stores, each offering in-store shopping, curbside pick-up services and virtual appointments.
The company reports strong demand on its e-commerce platform, as well as its retail partnership channels, and expects the supply constraints will improve in future quarters as it continues to address those issues.
Casper provided outlook for the fourth quarter, based on the assumption that there will be “no material changes in world events, weather, recent consumer trends, economic conditions, competitive landscape or other circumstances beyond our control.” It expects revenue of approximately $132 million to $142 million, drive by the e-commerce channel and expansion of its retail partnerships.