FLWS Reports Decline in Revenues for Latest Quarter
Segments of Revenue
During the three months ended December 31, 2023, FLWS reported a decrease in revenues of 8.4% to $822.1 million compared to the same period in the prior year. Similarly, for the six months ended December 31, 2023, revenues decreased by 9.2% to $1.09 billion compared to the same period in the prior year.
FLWS management expects sales trends to improve in the second half of fiscal 2024, although at a slower pace than initially anticipated. This suggests that the company is actively working towards addressing the challenges it faced in the latest quarter. Additionally, FLWS experienced an increase in average order value during the three and six months ended December 31, 2023, which was partially offsetting the decline in order volume. This increase in average order value was attributed to a product mix into higher price point items, including bundles, and a customer mix with more affluent consumers buying at a higher rate.
FLWS faced challenging macro-economic conditions that impacted its customers, which in turn affected the company's operating costs. In-bound and out-bound shipping, commodity, labor, and fuel costs surged during the second quarter of fiscal 2022 and continued to escalate throughout the balance of the year and into fiscal 2023. Although certain commodity prices remained near historical highs, FLWS started to see a more stable labor market and significant year-over-year reductions in ocean freight costs during the second quarter and third quarter of fiscal 2023. However, these challenges still affected the company's financial performance.
FLWS historically experiences higher revenues during major floral gifting occasions, such as Mother's Day, Valentine's Day, Easter, and Administrative Professionals Week. Revenues have historically risen during the company's fiscal third and fourth quarters compared to its fiscal first quarter. This seasonality in revenues should be taken into account when analyzing FLWS's performance.
FLWS reported a decline in revenues for the latest quarter, with revenues decreasing by 8.4% to $822.1 million compared to the same period in the prior year. The company faced challenges due to challenging macro-economic conditions that impacted its customers and operating costs. However, FLWS management expects sales trends to improve in the second half of fiscal 2024, and the company experienced an increase in average order value, partially offsetting the decline in order volume. It is important to note that FLWS's revenues are influenced by seasonal factors, with higher revenues typically seen during major floral gifting occasions.