Grove Collaborative Holdings Inc (GROV) 2023 Q2 法說會逐字稿

Good afternoon and thank you for standing by. Welcome to Grove Collaborative Holdings, Inc.'s Second Quarter 2023 Earnings Conference Call. (Operator Instructions) As a reminder, this conference call is being recorded.

下午好，感謝您的支持。歡迎參加 Grove Collaborative Holdings, Inc. 的 2023 年第二季度收益電話會議。 （操作員說明）謹此提醒，本次電話會議正在錄音。

Hosting today's call are Grove's Co-Founder and CEO, Stuart Landesberg; and CFO, Sergio Cervantes. Before they begin their prepared remarks, I will review the forward-looking statement, safe harbor. Some of the statements made today about future prospects, financial results, business strategies, industry trends and Grove's ability to successfully respond to business risks, may be considered forward-looking. Such statements involve a number of risks and uncertainties that could cause actual results to differ materially.

主持今天電話會議的是 Grove 聯合創始人兼首席執行官 Stuart Landesberg；和首席財務官塞爾吉奧·塞萬提斯。在他們開始準備好的發言之前，我將回顧一下前瞻性聲明“安全港”。今天發表的一些有關未來前景、財務業績、業務戰略、行業趨勢以及 Grove 成功應對業務風險的能力的聲明可能被視為前瞻性的。此類陳述涉及許多風險和不確定性，可能導致實際結果存在重大差異。

All these statements are based on Grove's view of the world and their business as they see it today. As described in their SEC filings, the underlying facts and assumptions for these statements can change as the world and their business changes. For more information, please refer to the risk factors discussed in their most recent filings with the SEC which are available on Grove's Investor Relations website at investors.grove.co.

所有這些陳述都是基於格羅夫對世界和他們今天的業務的看法。正如他們在 SEC 文件中所述，這些聲明的基本事實和假設可能會隨著世界及其業務的變化而變化。欲了解更多信息，請參閱他們最近向 SEC 提交的文件中討論的風險因素，這些文件可在 Grove 的投資者關係網站 Investors.grove.co 上找到。

During today's call, they will also discuss certain non-GAAP financial measures. Reconciliations of these non-GAAP items to the most directly comparable GAAP financial measures are provided in the earnings release, which is also available on their Investor Relations website.

在今天的電話會議中，他們還將討論某些非公認會計準則財務指標。收益報告中提供了這些非公認會計準則項目與最直接可比的公認會計準則財務指標的對賬，該收益報告也可在其投資者關係網站上找到。

I will now turn the call over to Stuart Landesberg to begin.

我現在將把電話轉給斯圖爾特·蘭德斯伯格開始。

Thank you, operator. Hello, everyone, and thank you for joining the call today. I want to start this call with a reminder about why Grove's mission and brand purpose is more important and relevant than ever. Around the world, July was the hottest month on record. Wildfires blazed from Canada to Hawaii. The U.S. Secretary General recently declared that the period of global warming has ended and the era of global boiling has arrived. Our reports from Swiss researchers said that in July, we passed the annual amount of plastic waste that our systems can handle, the implication being that the rest of the year's plastic ends up as pollution in our environment. But change is possible and consumers increasingly demand it. For Grove and for the Grove Co brand, this is an obligation. And this is an opportunity and this is our company's reason for being.

謝謝你，接線員。大家好，感謝您今天加入通話。在本次電話會議開始時，我想提醒一下為什麼 Grove 的使命和品牌宗旨比以往任何時候都更加重要和相關。在世界各地，七月是有記錄以來最熱的月份。野火從加拿大一直蔓延到夏威夷。美國秘書長最近宣布，全球變暖時期已經結束，全球沸騰時代已經到來。瑞士研究人員的報告稱，7 月份，我們的系統超過了每年可處理的塑料廢物量，這意味著今年剩餘時間的塑料最終會成為我們環境的污染。但改變是可能的，而且消費者的需求也越來越大。對於 Grove 和 Grove Co 品牌來說，這是一項義務。這是一個機會，也是我們公司存在的理由。

Turning now to the second quarter. This quarter was another very strong step in the journey to improve Grove's fundamentals for sustainable, profitable growth. We achieved record net revenue per order of $64.80, beating our previous record in Q4 2022 by $1.40 or 2.2%, while maintaining a strong gross margin of 51.9% comparable to our record in Q1 2023 despite the impact of a $1.1 million inventory reserve charge.

現在轉向第二季度。本季度是 Grove 改善可持續盈利增長基礎的又一個非常有力的步驟。我們實現了創紀錄的每訂單淨收入64.80 美元，比2022 年第四季度的之前記錄高出1.40 美元或2.2%，同時保持了51.9% 的強勁毛利率，與2023 年第一季度的記錄相當，儘管受到110 萬美元庫存儲備費用的影響。

Excluding the impact of the reserve charge, our Q2 2023 gross margin would have been 53.6%, which would have been a new record for Grove. These 2 drivers plus the strategic reduction in advertising spend led to an adjusted EBITDA margin improvement of 570 basis points quarter-over-quarter and 2,270 basis points year-over-year despite the expected decline in sales due to lower marketing spend throughout the last several quarters. Not only did we meaningfully improve our adjusted EBITDA, but we generated $1.2 million of operating free cash flow during Q2, even inclusive of $3.1 million of cash interest payments on our outstanding debt. This is our first operating cash flow positive quarter ever as a company, and the result is a true testament that supports the long-term ambition of being financially self-sufficient.

排除準備金費用的影響，我們 2023 年第二季度的毛利率將為 53.6%，這將是 Grove 的新紀錄。儘管過去幾年營銷支出下降導致銷售額預計下降，但這兩個驅動因素加上廣告支出的戰略性削減，導致調整後 EBITDA 利潤率環比提高 570 個基點，同比提高 2,270 個基點宿舍。我們不僅顯著改善了調整後的 EBITDA，而且在第二季度產生了 120 萬美元的運營自由現金流，甚至包括未償債務的 310 萬美元現金利息支付。這是我們作為一家公司有史以來第一個運營現金流為正的季度，其結果是支持財務自給自足的長期雄心的真實證明。

The strong adjusted EBITDA results were driven by continued execution of our 4-point value creation plan, which encompasses number one, improve marketing efficiency; number two, omnichannel expansion; number three, net revenue management; and four, operating expense discipline. I will dig into each of these initiatives in a bit more detail.

強勁的調整後 EBITDA 業績得益於我們四點價值創造計劃的持續執行，其中第一點是提高營銷效率；第二，全渠道擴張；第三，淨收入管理；四是經營費用紀律。我將更詳細地探討每一項舉措。

Starting with marketing efficiency. We continue to see strong performance in the quarter due to the optimization of our spend, allocation to cross channels and strong performance in unpaid checkouts. Media tax in the second quarter were down approximately 60% year-over-year and approximately 32% quarter-over-quarter, achieving our lowest since the peak of the pandemic, highlighting our ability to target the most efficient channels and our strong organic awareness. This result gives us increased confidence in our ability to become a profitable business and to stabilize and over the long term, grow our revenue. Furthermore, despite less spend on a year-over-year basis, our internal brand research highlights that our unaided brand awareness is the highest it's ever been and increased materially versus our last measurement period, which was October of last year. Again, this is even at lower levels we spent.

從營銷效率入手。由於我們支出的優化、跨渠道的分配以及未付費結賬的強勁表現，我們繼續看到本季度的強勁表現。第二季度媒體稅同比下降約 60%，環比下降約 32%，達到疫情高峰以來的最低水平，凸顯了我們瞄準最高效渠道的能力以及強大的有機意識。這一結果使我們對成為盈利企業、穩定並長期增加收入的能力更有信心。此外，儘管支出同比減少，但我們的內部品牌研究強調，我們的獨立品牌知名度達到了歷史最高水平，並且與我們去年 10 月的上一次衡量期間相比，有了實質性增長。同樣，這甚至是我們花費的較低水平。

We made additional progress in the quarter on our omnichannel distribution expansion strategy despite a challenging retail environment overall for natural brands. We announced progress with Kroger and Hannaford as new partners taking our retail footprint to over 5,700 brick-and-mortar locations. We are also encouraged by the performance of Grove Co, our flagship brand on Amazon. We increased our SKU assortment to include laundry sheets, foaming hand soap, floor cleaner, glass cleaner, and tub and tile product lines during the quarter, expanding on the successful launches of multipurpose cleaner concentrates and hand and dish soap bundles during Q1. Across all retailers, we have also optimized our promotional strategies to drive margin expansion while continuing to expand distribution.

儘管天然品牌的整體零售環境充滿挑戰，但我們在本季度的全渠道分銷擴張戰略方面取得了額外進展。我們宣布與 Kroger 和 Hannaford 作為新合作夥伴取得進展，將我們的零售足跡擴展到 5,700 多個實體店。我們還對我們在亞馬遜上的旗艦品牌 Grove Co 的表現感到鼓舞。我們在本季度增加了SKU 品種，包括洗衣床單、泡沫洗手液、地板清潔劑、玻璃清潔劑以及浴缸和瓷磚產品線，擴大了第一季度成功推出的多用途清潔劑濃縮液以及洗手液和洗碗皂捆綁包的範圍。在所有零售商中，我們還優化了促銷策略，以推動利潤增長，同時繼續擴大分銷。

Meeting our customers where they shop is critical to our objective of making sustainable, effective household essentials as accessible as possible. We remain focused on delivering our long-term capital efficient growth strategy by putting our products on more shelves and in the hands of more consumers. We are just over 2 years into our retail journey and are encouraged by early trends. We are just getting started in this channel where the majority of consumers still shop and are excited to take share in this way in the U.S. home and personal care market, which amounts to approximately $180 billion.

在顧客購物時與他們見面對於我們實現盡可能提供可持續、有效的家庭必需品的目標至關重要。我們仍然致力於通過將我們的產品放在更多貨架上並交到更多消費者手中來實現我們的長期資本效率增長戰略。我們的零售之旅才剛剛兩年多，早期趨勢就給我們帶來了鼓舞。我們在這個渠道上才剛剛起步，大多數消費者仍在購物，並且很高興能夠以這種方式在價值約 1800 億美元的美國家庭和個人護理市場中分一杯羹。

Third, net revenue management initiatives focused on strategic pricing and on the optimization of DTC net revenue per order implemented in the back half of 2022, coupled with fewer new customer orders delivered a record net revenue per order for Grove of $64.80 this was an improvement of 11% year-over-year and 5% quarter-over-quarter. As we highlighted last quarter, as we improve our gross margins, increasing the DTC revenue we earn per order is especially beneficial. We will touch on this more later on, but we are optimistic that we can continue to move the needle on this metric as we expand our health and wellness offering to the consumer.

第三，淨收入管理舉措側重於戰略定價和2022 年下半年實施的DTC 每訂單淨收入的優化，加上新客戶訂單的減少，為Grove 帶來了創紀錄的每訂單淨收入64.80 美元，這是對同比增長 11%，環比增長 5%。正如我們上季度強調的那樣，隨著毛利率的提高，增加每筆訂單賺取的 DTC 收入尤其有利。我們稍後將詳細討論這一點，但我們樂觀地認為，隨著我們向消費者提供更多的健康和保健服務，我們可以繼續推動這一指標。

Lastly, even as we get closer to profitability, we remain ever focused on driving margin improvement by maintaining strict expense discipline and are seeing results across the P&L. From pricing actions and procurement initiatives to improve gross margin, carrier mix optimization that drives down outbound shipping costs, to improve advertising channel allocation and new strong performing creative, coupled with strong organic traffic, yielding CAC improvements to relentless work on SG&A efficiencies. Our entire team is focused on finding opportunities to drive profitability while delivering for our consumer and executing with a streamlined expense structure.

最後，即使我們越來越接近盈利，我們仍然專注於通過維持嚴格的費用紀律來推動利潤率的提高，並且在損益表中看到了結果。從提高毛利率的定價行動和採購計劃、降低出境運輸成本的承運人組合優化，到改善廣告渠道分配和新的表現強勁的創意，再加上強大的有機流量，從CAC 改進到對SG&A 效率的不懈努力。我們的整個團隊致力於尋找提高盈利能力的機會，同時為我們的消費者提供服務並以精簡的費用結構執行。

This value creation plan drove continued improvement in our second quarter financial results. Adjusted EBITDA loss in the second quarter of 2023 was $2.6 million, an improvement from a loss of $6.9 million in the first quarter of 2023 and a loss of $21.1 million in the second quarter of last year. An improvement of 88% year-over-year. This improvement was achieved despite a revenue decline in the second quarter, which was down 8% sequentially and 17% year-over-year, primarily driven by the 74% strategic reduction in advertising spend in the current quarter when compared to Q2 2022. This reduction in advertising spend continues to reflect our strategy of building a machine that can focus on the most profitable marketing spend to drive profitable growth in 2024 off a durable and high-margin existing customer revenue base.

這一價值創造計劃推動了我們第二季度財務業績的持續改善。 2023 年第二季度調整後 EBITDA 虧損為 260 萬美元，較 2023 年第一季度虧損 690 萬美元和去年第二季度虧損 2110 萬美元有所改善。同比提升88%。儘管第二季度收入下降（環比下降 8%，同比下降 17%），但仍實現了這一改善，這主要是由於本季度廣告支出與 2022 年第二季度相比戰略性削減了 74%。廣告支出的減少繼續反映了我們的戰略，即打造一台能夠專注於最有利可圖的營銷支出的機器，以在持久且高利潤的現有客戶收入基礎上推動2024 年的盈利增長。

While the reduction in advertising spend resulted in year-over-year comparative pressure on revenue, which we expect to continue throughout 2023, our efforts to improve advertising efficiency have driven strong results, and we remain confident that it is the right step to position ourselves for success in the future.

雖然廣告支出的減少導致了收入的同比相對壓力（我們預計這種情況將持續到 2023 年），但我們提高廣告效率的努力帶來了強勁的業績，我們仍然相信這是自我定位的正確步驟為了未來的成功。

During the quarter, we continued to make progress towards our goal of moving beyond plastic. In the second quarter, we continued to focus on improving plastic intensity or pounds of plastic per $100 in revenue. Site-wide and through retail partners, plastic intensity was 1.01 pounds of plastic per $100 in revenue, a slight improvement from 1.02 in the first quarter of 2023. And a meaningful improvement from 1.07 in the second quarter of last year.

本季度，我們繼續朝著超越塑料的目標取得進展。第二季度，我們繼續專注於提高塑料強度或每 100 美元收入的塑料磅數。在整個網站範圍內，通過零售合作夥伴，塑料強度為每100 美元收入1.01 磅塑料，比2023 年第一季度的1.02 略有改善。與去年第二季度的1.07 相比，也有了有意義的改善。

Specifically, 67% of revenue from Grove Co products came from either zero plastic, reusable or refillable and zero plastic-waste products, meeting the company's Beyond Plastic standard. Down slightly from 70% in the first quarter of 2023 and second quarter of last year. We are working on bringing more innovations to market that can drive this number higher. We continue to challenge others to disclose plastic intensity as we lead the industry in the move away from plastic.

具體來說，Grove Co 產品 67% 的收入來自零塑料、可重複使用或可再填充以及零塑料廢物產品，符合該公司的 Beyond Plastic 標準。較2023年第一季度和去年第二季度的70%略有下降。我們正在努力將更多創新推向市場，以推動這一數字更高。隨著我們引領行業擺脫塑料，我們將繼續挑戰其他人披露塑料強度。

Building off the success of our value creation plan. I'm excited to announce today our growth and market expansion initiative. This initiative builds on our strong position in sustainability with a focus on customer centricity and customer service, continuing momentum in the health and wellness category, enhancing our focus on replenishment categories and improving the VIP program by making the benefits and experience more intuitive and easier to use.

鞏固我們價值創造計劃的成功。我很高興今天宣布我們的增長和市場擴張計劃。這一舉措建立在我們在可持續發展方面的強大地位之上，重點關注以客戶為中心和客戶服務，保持健康和保健類別的勢頭，加強我們對補貨類別的關注，並通過使福利和體驗更直觀、更容易理解來改進VIP 計劃。使用。

On that note, today, I'm also excited to announce the VIP hub which makes it seamless for VIP customers to access exclusive benefits like samples, VIP discounts and early access to limited edition collections. This feature was built based on feedback from literally thousands of VIP customers on what would improve their experience and represents a great step in helping our customers get the best value from Grove, discover new products and prevent additional plastic waste.

就這一點而言，今天我還很高興地宣布推出 VIP 中心，該中心使 VIP 客戶可以無縫地獲得獨家優惠，例如樣品、VIP 折扣和搶先體驗限量版系列。該功能是根據數千名 VIP 客戶關於如何改善他們的體驗的反饋而構建的，代表著在幫助我們的客戶從 Grove 獲得最大價值、發現新產品和防止額外塑料浪費方面邁出了一大步。

We are optimistic that these benefits will continue to drive loyalty among our best customers while also providing the right incentives to add more VIPs to our community. We have a number of new features in the pipeline, but the early response has been terrific. We look forward to improving our customer experience for these customers and are grateful for their feedback as we seek to continue innovating.

我們樂觀地認為，這些福利將繼續提高我們最佳客戶的忠誠度，同時也提供適當的激勵措施，為我們的社區增加更多 VIP。我們正在開發許多新功能，但早期的反應非常好。我們期待為這些客戶改善客戶體驗，並感謝他們在我們尋求持續創新時提供的反饋。

Grove Wellness, which launched in March, is making progress. As a reminder from our last quarter, our research suggests that 89% of customers would trust Grove over other sources to solve their health and wellness needs. Continuing the trend from last quarter, we saw a record amount of revenue and percent of orders containing wellness products. This is important because not only do wellness offerings expand customer order sizes, contributing to record net revenue per order in the current quarter, but many of these offerings are highly regimented. From multi-vitamins to (inaudible) relaxation, digestive health, [allergy] season needs, immune support and men's and women's health. We are setting ourselves up to become the platform that consumers can turn to for all of their lifestyle needs.

Grove Wellness 於三月份推出，目前正在取得進展。上個季度的提醒是，我們的研究表明，89% 的客戶會信任 Grove，而不是其他來源來解決他們的健康和保健需求。延續上季度的趨勢，我們看到了創紀錄的收入和包含健康產品的訂單百分比。這很重要，因為健康產品不僅擴大了客戶訂單規模，有助於本季度每筆訂單的淨收入創紀錄，而且其中許多產品都是高度管制的。從多種維生素到（聽不清）放鬆、消化健康、[過敏]季節需求、免疫支持以及男性和女性健康。我們致力於成為消費者可以滿足其所有生活方式需求的平台。

While health and wellness sales currently make up a small percentage of our overall revenue. We are encouraged by our customers' response to date and are excited to bring them more offerings in the coming quarters. We have grown our SKU count in this category by over 60% year-to-date and expect to roughly double our SKU count in this category over the coming quarters by the end of the year.

目前，健康和保健銷售僅占我們總收入的一小部分。我們對客戶迄今為止的反應感到鼓舞，並很高興在未來幾個季度為他們提供更多產品。今年迄今為止，我們在該類別中的 SKU 數量已增長了 60% 以上，預計到今年年底，未來幾個季度我們在該類別中的 SKU 數量將大約增加一倍。

Moreover, as we enhance our focus on high replenishment categories, R&D remains a top priority for us. Our DTC platform powers the Grove innovation engine, providing us with superior access to customer data and preferences and allowing for quick iteration and test and learn. We use these insights to drive innovation and SKU development at a quicker pace than our competitors and many in the industry. This ensures that when we bring products to market and especially to retailers, we have already proven their success, allowing for sustainable growth in retail and in our own brands over time.

此外，隨著我​​們加強對高補貨品類的關注，研發仍然是我們的首要任務。我們的 DTC 平台為 Grove 創新引擎提供動力，使我們能夠更好地訪問客戶數據和偏好，並允許快速迭代、測試和學習。我們利用這些見解以比我們的競爭對手和業內許多人更快的速度推動創新和 SKU 開發。這確保了當我們將產品推向市場，尤其是零售商時，我們已經證明了它們的成功，從而使零售業和我們自己的品牌隨著時間的推移實現可持續增長。

Our innovation pipeline is strong as well. And we are excited to announce new product launches over the coming quarters, which will provide more ways for customers to enjoy all of Grove's offerings. For example, we recently announced our fall seasonal collection, Traditions Aglow. Featuring limited-edition fall scents Harvest Apple and Spiced Pumpkin. They are exclusively available on our site and app, and you can find great bundles in the VIP hub.

我們的創新渠道也很強大。我們很高興地宣佈在未來幾個季度推出新產品，這將為客戶提供更多方式享受 Grove 的所有產品。例如，我們最近宣布了秋季系列 Traditions Aglow。以限量版秋季香味 Harvest Apple 和五香南瓜為特色。它們僅在我們的網站和應用程序上提供，您可以在 VIP 中心找到精彩的捆綁包。

We also continue to explore M&A, which could provide a step change opportunity. Our grove.com platform, DTC fulfillment capability, in-house marketing expertise, sustainability leadership and potential to merge retail sales efforts are a few examples of how our current infrastructure could create material synergies. The bar for action, as always, is extremely high, and we continue to be deliberate with how we invest time and resources.

我們還繼續探索併購，這可以提供階躍變革的機會。我們的 grove.com 平台、DTC 履行能力、內部營銷專業知識、可持續發展領導力以及合併零售銷售工作的潛力是我們當前基礎設施如何創造物質協同效應的幾個例子。一如既往，行動的門檻非常高，我們將繼續深思熟慮如何投入時間和資源。

Now I want to turn to a couple of incredibly exciting business updates. First, I'm excited to announce the appointment of Jeff Yurcisin as the new Chief Executive Officer for Grove Collaborative effective August 16. Jeff will also join our Board of Directors. Jeff is the former CEO of Zulily and Shopbop. And before that, a tenured Amazon executive, including experience bringing innovative physical products to life as a leader for Amazon brands. He is an experienced team builder with a proven direct-to-consumer background, building and leading multiple billion-dollar brands.

現在我想談談一些令人難以置信的令人興奮的業務更新。首先，我很高興地宣布任命 Jeff Yurcisin 為 Grove Collaborative 新任首席執行官，該任命將於 8 月 16 日生效。Jeff 還將加入我們的董事會。 Jeff 是 Zulily 和 Shopbop 的前首席執行官。在此之前，一位亞馬遜終身高管，擁有作為亞馬遜品牌領導者將創新實體產品帶入生活的經驗。他是一位經驗豐富的團隊建設者，擁有成熟的直接面向消費者的背景，創建並領導了多個價值數十億美元的品牌。

And as importantly, Jeff is mission-driven and understands that today's consumer rewards companies and brands that do well by doing good. Jeff's customer centricity is second to none. And I believe that he will lead the company to profitable growth rooted in sustainable product innovation, improved customer experience and continued boldness.

同樣重要的是，傑夫以使命為導向，並了解當今的消費者會通過做好事來獎勵表現出色的公司和品牌。傑夫以客戶為中心的理念是首屈一指的。我相信他將帶領公司實現基於可持續產品創新、改善客戶體驗和持續大膽的盈利增長。

I am excited to personally take on the new role of Executive Chairman of the Board, preceding our current Chairman, John Replogle, who will now serve as the Board's Lead Independent Director. My focus will continue to be on strategy as well as capital markets and corporate development, among other things.

我很高興能夠親自擔任董事會執行主席的新職務，而現任主席 John Replogle 則將擔任董事會首席獨立董事。我的重點將繼續放在戰略、資本市場和企業發展等方面。

Next, I'm excited to announce that subsequent to the end of Q2, we received a $10 million investment from Volition Capital. This investment is in Series A preferred stock with no mandatory dividends, important for our cash flow. And a conversion price of $2.11 per share, a 9.5% premium to the 45-day VWAP at closing, plus warrants at $6.33 per share. More details are available in the press release put out today.

接下來，我很高興地宣布，第二季度末後，我們收到了 Volition Capital 的 1000 萬美元投資。這項投資是 A 系列優先股，沒有強制股息，這對我們的現金流很重要。轉換價為每股 2.11 美元，較收盤時 45 天成交量加權平均價格溢價 9.5%，加上每股 6.33 美元的認股權證。更多詳細信息請參閱今天發布的新聞稿。

We are highly sensitive to dilution. However, Volition experience in the sector is truly second to none. Larry Cheng, a managing partner and Co-Founder, of Volition, will join the Grove Board. His experience leading Volition investment in Chewy, and helping guide them pass $1 billion in revenue and his current Board service at GameStop, helping them drive transformation and community will both be highly additive. Volition completed extensive private side, financial and market due diligence. Their investment is a differentiating statement in the current climate and a testament to the work our team has done over the last year, creating a terrific future ahead. Potential uses of funds include general corporate purposes, growth opportunities and possibly stock buybacks.

我們對稀釋高度敏感。然而，Volition 在該領域的經驗確實是首屈一指的。 Volition 的管理合夥人兼聯合創始人 Larry Cheng 將加入 Grove 董事會。他領導 Volition 對 Chewy 進行投資、幫助引導他們超過 10 億美元的收入以及他目前在 GameStop 的董事會服務、幫助他們推動轉型和社區的經驗都將具有高度的附加性。 Volition 完成了廣泛的私人、財務和市場盡職調查。他們的投資是在當前環境下的差異化聲明，也是我們團隊去年所做工作的證明，創造了美好的未來。資金的潛在用途包括一般公司用途、增長機會以及可能的股票回購。

Before I pass the call over, I'd like to express my heartfelt gratitude to the entire Grove team and to our community. This has been an exceptional year of transformation. Your unwavering dedication to our customers, laser-focus and your approach to our key initiatives and sense of urgency has been instrumental in what created our success. I feel incredibly grateful to be a part of this remarkable journey alongside each and every one of you.

在轉接電話之前，我謹向整個 Grove 團隊和我們的社區表示衷心的感謝。今年是轉型的非凡一年。你們對客戶堅定不移的奉獻精神、高度專注、對我們關鍵舉措的態度以及緊迫感，對我們的成功發揮了重要作用。我非常感激能夠與你們每一個人一起參與這一非凡的旅程。

I'll now turn the call over to Sergio to review our results in more detail. Sergio, please take it away.

我現在將把電話轉給塞爾吉奧，以更詳細地審查我們的結果。塞爾吉奧，請把它拿走。

Thank you, Stuart. Similar to previous calls, we will provide quarter-over-quarter comparisons in addition to the year-over-year changes. As we believe the sequential comparisons better reflect the strength in the business and the steps we have taken to position ourselves for long-term sustainable and profitable growth.

謝謝你，斯圖爾特。與之前的電話會議類似，除了同比變化之外，我們還將提供環比比較。因為我們相信連續比較可以更好地反映業務實力以及我們為實現長期可持續和盈利增長而採取的步驟。

Net revenue in the second quarter was $66.1 million, down 8% from the first quarter of 2023 and 17% year-over-year. Both comparisons continue to be impacted by the strategic decision to reduce advertising spend as the company focuses on achieving profitable growth in 2024. The sequential decline is also impacted by the seasonal increase in advertising spend in the first quarter of 2023, while our sustainability messaging resonates more strongly with consumers.

第二季度淨收入為 6610 萬美元，較 2023 年第一季度下降 8%，同比下降 17%。這兩項比較繼續受到減少廣告支出的戰略決策的影響，因為該公司專注於在2024 年實現盈利增長。環比下降還受到2023 年第一季度廣告支出季節性增長的影響，而我們的可持續發展信息產生了共鳴與消費者的互動更加強烈。

Similarly, total orders were down 11% quarter-over-quarter and 26% year-over-year to 1 million. And active customers were down 9% quarter-over-quarter and 28% year-over-year to 1.1 million on a trailing 12-month basis. DTC net revenue per order was up 5% quarter-over-quarter and 11% year-over-year to $64.8, a record high level surpassing our previous record of $63.4 achieved in Q4 2022.

同樣，訂單總數環比下降 11%，同比下降 26%，至 100 萬份。過去 12 個月的活躍客戶數量環比下降 9%，同比下降 28%，至 110 萬。 DTC 每訂單淨收入環比增長 5%，同比增長 11%，達到 64.8 美元，創下歷史新高，超過了我們之前在 2022 年第四季度創下的 63.4 美元的記錄。

The year-over-year increase was due to net revenue management initiatives, including the launch of the supply chain fee, a higher percentage of existing customer orders compared to new customer orders as well as the introduction of strategic price increases on Grove brands and third-party products. The sequential increase was further benefited by a higher percentage of orders coming from existing customers, and a recovery from a seasonally softer first quarter.

同比增長歸因於淨收入管理舉措，包括推出供應鏈費用、現有客戶訂單相對於新客戶訂單的比例更高，以及對 Grove 品牌和第三方品牌實行戰略性提價。 -派對產品。來自現有客戶的訂單比例提高以及第一季度季節性疲軟的複蘇進一步受益於環比增長。

Gross margin was down 20 basis points from the first quarter of 2023. But up 280 basis points year-over-year to 51.9%, very close to gross record high in the first quarter of this year. The Q2 2023 gross margin was impacted by a $1.1 million inventory reserve charge. Absent the impact of these reserves, gross margin would have been 53.6%, which would have been a new record for the company, surpassing the prior record by 150 basis points.

毛利率較2023年第一季度下降20個基點，但同比增長280個基點至51.9%，非常接近今年第一季度的毛利率歷史新高。 2023 年第二季度毛利率受到 110 萬美元庫存儲備費用的影響。如果沒有這些儲備的影響，毛利率將達到53.6%，這將是該公司的新紀錄，比之前的記錄高出150個基點。

The quarter-over-quarter change was further impacted by a decrease in Grove brands' percentage of net revenue offset by a decrease in discount rate and lower product costs. Grove brands as a percentage of net revenue declined 380 basis points quarter-over-quarter and 290 basis points year-over-year to 45%. The year-over-year and sequential decreases are due to a higher mix of third-party products within existing customer orders as we continue to expand our offering. And a decrease in new customer orders, which include more Grove brand products.

Grove 品牌占淨收入百分比的下降進一步影響了環比變化，而折扣率的下降和產品成本的降低抵消了這一影響。 Grove 品牌占淨收入的百分比環比下降 380 個基點，同比下降 290 個基點，至 45%。同比和環比下降的原因是，隨著我們繼續擴大我們的產品範圍，現有客戶訂單中第三方產品的組合有所增加。新客戶訂單減少，其中包括更多 Grove 品牌產品。

The sequential decline of road products in existing orders was largely due to coming off a seasonally high performance in Q1, whereas the year-over-year decline is due to an expansion to categories with an increased third-party presence, including VMS, home decor and storage. We believe that having a diverse SKU assortment on our DTC side makes for a better customer experience. Advertising expenses decreased 46% quarter-over-quarter following our typical seasonal pattern and fell 74% year-over-year to $4.7 million, reflecting our strategic pullback in advertising spend and focus on improving marketing investment efficiency. We continue to be pleased with the improvement in advertising efficiency resulting from this strategy.

現有訂單中道路產品的環比下降主要是由於第一季度的季節性高表現，而同比下降則是由於第三方業務增加而擴展到了類別，包括 VMS、家居裝飾和存儲。我們相信，DTC 方面擁有多樣化的 SKU 分類可以帶來更好的客戶體驗。遵循我們典型的季節性模式，廣告費用環比下降 46%，同比下降 74% 至 470 萬美元，反映出我們對廣告支出的戰略性縮減並專注於提高營銷投資效率。我們對這一策略帶來的廣告效率的提高仍然感到滿意。

Product development decreased 4% quarter-over-quarter and 32% year-over-year to $4.1 million. Mainly due to a decrease in personnel expenses. Despite the lower investment, we continue to make progress in our innovation strategy. SG&A expense decreased 8% quarter-over-quarter and 39% year-over-year to $35.2 million. Excluding stock-based compensation and severance, SG&A expense in the quarter would have been $30.2 million or 10% less than the first quarter of 2023 and 24% less than the same period last year. The quarter-over-quarter decline was mainly due to lower fulfillment costs and other operating expenses, which is reflective of our strategy of creating operational efficiencies and eliminating less productive spend to focus on profitability. As a percent of net revenue, SG&A expense would have been 45.7% compared to 47.1% in the first quarter of 2023. And 50.2% in the second quarter of 2020.

產品開發環比下降 4%，同比下降 32%，至 410 萬美元。主要是人員費用減少所致。儘管投資減少，我們的創新戰略仍在繼續取得進展。 SG&A 費用環比下降 8%，同比下降 39%，至 3,520 萬美元。不包括基於股票的薪酬和遣散費，本季度的 SG&A 費用將為 3020 萬美元，比 2023 年第一季度減少 10%，比去年同期減少 24%。環比下降主要是由於履行成本和其他運營費用降低，這反映了我們提高運營效率和消除生產力較低的支出以專注於盈利能力的戰略。按淨收入的百分比計算，SG&A 費用將為 45.7%，而 2023 年第一季度為 47.1%。2020 年第二季度為 50.2%。

Our adjusted EBITDA loss improved to $2.6 million as compared to $6.9 million loss in the first quarter of 2023. And was a material improvement compared to the $21.1 million loss in the second quarter of 2022 despite lower sales. Our adjusted EBITDA margin improved by 570 basis points quarter-over-quarter and by 2,270 basis points year-over-year to minus 3.9%. The quarter-over-quarter improvement was due to lower advertising investment expenses, partially offset by a lower gross profit due to less revenue. Net loss in the quarter was $10.9 million compared to a net loss of $13.1 million in the first quarter of 2023. And a loss of $35.3 million in the second quarter of 2022.

與2023 年第一季度的690 萬美元虧損相比，我們調整後的EBITDA 虧損改善至260 萬美元。儘管銷售額有所下降，但與2022 年第二季度2110 萬美元的虧損相比，這是一個重大改善。我們調整後的 EBITDA 利潤率環比提高了 570 個基點，同比提高了 2,270 個基點，達到負 3.9%。環比改善是由於廣告投資費用下降，但部分被收入減少導致的毛利潤下降所抵消。本季度淨虧損為 1090 萬美元，而 2023 年第一季度淨虧損為 1310 萬美元。2022 年第二季度淨虧損為 3530 萬美元。

Turning now to the balance sheet. We ended the quarter with $89.7 million in cash, cash equivalents and restricted cash, down $0.7 million from the previous quarter, primarily from the adjusted EBITDA losses and interest payments, largely offset by working capital efficiencies particularly on inventory. We finished the quarter with an inventory balance of $34.5 million, down $6.4 million from the end of Q1 2023. Bringing down our inventory balance continues to be an area of focus in our pursuit to improve our working capital, and we are pleased with our results to date. Which resulted in our first quarter of positive operating cash flow of $1.2 million.

現在轉向資產負債表。本季度結束時，我們的現金、現金等價物和限制性現金為8970 萬美元，比上一季度減少70 萬美元，主要來自調整後的EBITDA 損失和利息支付，很大程度上被營運資本效率（尤其是庫存效率）所抵消。本季度末，我們的庫存餘額為 3,450 萬美元，比 2023 年第一季度末減少了 640 萬美元。降低庫存餘額仍然是我們改善營運資本的重點領域，我們對我們的結果感到滿意迄今為止。這使得我們第一季度的運營現金流為 120 萬美元。

As announced last quarter, in Q1, we closed on an asset-based loan facility with $35 million total capacity for which borrowing capacity is calculated from our inventory and accounts receivable balances. The loan is for a term of 3 years and will support our strategic initiatives and working capital needs. We did not make any draws during the second quarter after having taken the minimum draw of $7.5 million in Q1. Based on current inventory and AR balances, we have $9.3 million of capacity available under the ABL.

正如上季度宣布的，第一季度，我們完成了一項總容量為 3500 萬美元的資產貸款安排，其借款能力是根據我們的庫存和應收賬款餘額計算的。該貸款期限為 3 年，將支持我們的戰略舉措和營運資金需求。在第一季度進行了 750 萬美元的最低提款後，我們在第二季度沒有進行任何提款。根據當前庫存和應收賬款餘額，我們在 ABL 下擁有 930 萬美元的可用產能。

Furthermore, assuming a share price of $2.26, our average trading price in 2023, we have up to $13.6 million of capacity on our standby equity purchase agreement. Taking into account market conditions and business priorities, we will evaluate using this capacity strategically to supplement our liquidity. Lastly, as noted previously, a $10 million investment from Volition further solidifies our balance sheet. We feel good about our current liquidity position and our ability to continue executing on our aggressive push to profitability.

此外，假設股價為 2.26 美元（我們 2023 年的平均交易價格），我們的備用股權購買協議上的產能高達 1,360 萬美元。考慮到市場狀況和業務優先事項，我們將戰略性地評估如何使用該產能來補充我們的流動性。最後，如前所述，Volition 的 1000 萬美元投資進一步鞏固了我們的資產負債表。我們對當前的流動性狀況以及繼續積極推動盈利的能力感到滿意。

Now turning to our outlook. Factoring in our performance to date and our expectations for the remainder of the year, we are offering the following guidance. For the 12-month period ending December 31, 2023, we continue to expect net revenue of $260 million to $270 million, and we now expect an adjusted EBITDA margin of minus 5% to minus 7% and up from minus 5.5% to minus 7.5% previously.

現在轉向我們的展望。考慮到我們迄今為止的業績以及對今年剩餘時間的預期，我們提供以下指導。截至2023 年12 月31 日的12 個月期間，我們繼續預計淨收入為2.6 億美元至2.7 億美元，目前預計調整後EBITDA 利潤率為-5% 至-7%，從-5.5% 升至- 7.5% ％ 之前。

I would now like to turn the call back over to Stu for some closing remarks.

現在我想將電話轉回給斯圖，讓他發表一些結束語。

Thank you, Sergio. I'm truly proud of our accomplishments in our first year as a public company. Our team deserves credit for the rapid progress towards profitable growth and a secure balance sheet. And I have never been more confident in the customer-centric sustainable innovation that lies ahead. The opportunity to meet our customers and collaborating to create and scale a sustainable brand continues to be an important and worthy north star.

謝謝你，塞爾吉奧。我對我們作為上市公司第一年所取得的成就感到非常自豪。我們的團隊在盈利增長和安全資產負債表方面取得的快速進展值得讚揚。我對未來以客戶為中心的可持續創新充滿信心。與客戶見面並合作創建和擴展可持續品牌的機會仍然是重要且有價值的北極星。

I could not be more excited to welcome Jeff and Larry, and I could not be more grateful for the work of each of the extraordinary individuals on our Grove team who have driven our results to date and whose efforts ensure our best is still ahead of us. Thank you all for listening to our prepared remarks. We are now happy to answer any questions. Operator, please open the line.

我非常高興地歡迎杰夫和拉里，我非常感謝格羅夫團隊中每一位傑出人士的工作，他們推動了我們迄今為止的成果，他們的努力確保我們仍然領先於我們。 。感謝大家聆聽我們準備好的發言。我們現在很樂意回答任何問題。接線員，請開通線路。

(Operator Instructions) Our first question will come from Susan Anderson with Canaccord Genuity.

（操作員說明）我們的第一個問題將來自 Canaccord Genuity 的 Susan Anderson。

Nice job on the quarter. It's great to see that improvement in profitability. Stu, maybe if you could just kind of walk us through your thought process on why you feel right now is the right time to kind of hand the wand over to someone else to kind of take the company through its next leg of growth and just kind of go over kind of like why now is the right time?

本季度工作做得很好。很高興看到盈利能力的改善。 Stu，也許你能向我們介紹一下你的思考過程，為什麼你覺得現在是將魔杖交給其他人的合適時機，以帶領公司進入下一個增長階段，並且只是這樣有點像為什麼現在是正確的時間？

Thanks, Susan, and appreciate the call out for the progress. The team worked really hard and feel really good about the financials this quarter. In terms of why it was the right time. I think there were really 2 things at play. The first is if you look at our journey from IPO to now, we really moved quite an incredible distance to get the business operating as close to profitability as we did in the second quarter and as we've been able to say we will going forward.

謝謝蘇珊，並感謝大家對進展的呼籲。該團隊工作非常努力，對本季度的財務狀況感覺非常好。就為什麼現在是正確的時間而言。我認為確實有兩件事在起作用。首先，如果你看看我們從IPO 到現在的歷程，我們確實邁出了相當大的距離，讓業務運營接近盈利，就像我們在第二季度所做的那樣，正如我們已經能夠說的那樣，我們將繼續前進。

And that gives us the opportunity to look ahead and say, gosh, there really is this moment of, I don't want to quite say reset, but opportunity looking into the future and say who -- how can we best prepare ourselves to go through that. And so when we have the opportunity to work with an exceptional leader like Jeff, who has truly a track record of second to none in terms of building customer-centric direct-to-consumer businesses. Is -- that's something that's a massive opportunity for our mission, for our customers, for our shareholders that I think was too good to pass up on. And so always, that is my first thought.

這讓我們有機會展望未來並說，天哪，確實有這樣一個時刻，我不想說重置，但有機會展望未來並說誰 - 我們如何才能最好地做好準備通過那。因此，當我們有機會與像傑夫這樣的傑出領導者合作時，他在建立以客戶為中心的直接面向消費者的業務方面確實擁有首屈一指的記錄。對於我們的使命、我們的客戶、我們的股東來說，這是一個巨大的機會，我認為這是一個不容錯過的好機會。這總是我的第一個想法。

And the second is that there's a lot of really great work to be done, both inside the company that Jeff will be leading and outside the company sort of to make sure that we -- our awareness continues to grow, that we continue to have the time to focus and look at M&A in a current environment where there's a lot of really exciting opportunities out there.

第二個是，有很多真正偉大的工作要做，無論是在傑夫將領導的公司內部還是在公司外部，以確保我們——我們的意識持續增長，我們繼續擁有現在是時候在當前環境下關注並審視併購，那裡有很多真正令人興奮的機會。

And so really, the sort of combination of having a strong foundation with the opportunity to bring a truly, truly exceptional leader in Jeff and the opportunity to get some more leverage out in the market from the Executive Chairman role. I think made this an opportunity that was as within the timing really just so right and so exciting. And as a shareholder and fan of the company, I'm really excited for all that comes ahead.

事實上，這是一種結合，擁有堅實的基礎，有機會帶來傑夫這樣一位真正、真正傑出的領導者，並有機會從執行主席的角色中獲得更多的市場影響力。我認為這是一個機會，時機恰到好處，令人興奮。作為公司的股東和粉絲，我對即將發生的一切感到非常興奮。

Great. Yes, that sounds like a perfect fit, it seems like. And then maybe if you could just talk about on your advertising spend. The quarter, I think, dropped at about 7% of sales, I think, from 12% last quarter. I guess, is this kind of the new benchmark we should think about for advertising spend as you look forward through the back half of this year and into next year?

偉大的。是的，這聽起來像是一個完美的契合，看起來是這樣。然後也許您可以談談您的廣告支出。我認為，本季度銷售額的下降幅度約為 7%，而上季度為 12%。我想，當您展望今年下半年和明年時，這是我們應該考慮的廣告支出新基準嗎？

No. So we've seen historically that advertising is a bit seasonal with as Sergio mentioned, Q1, new year new you, people really like the sustainability message. We also find that back-to-school and sort of holiday Thanksgiving not holiday Christmas are both very, very strong periods for us. And so with a more efficient advertising mix, we're thinking a lot about how do we line our spend up through the year.

不。所以我們從歷史上看，廣告有點季節性，正如塞爾吉奧提到的，第一季度，新年新的你，人們真的很喜歡可持續發展的信息。我們還發現，返校和感恩節假期（而不是聖誕節假期）對我們來說都是非常非常重要的時期。因此，通過更有效的廣告組合，我們正在思考如何調整全年支出。

So I think in Q4, we'll probably be a bit above the 7%. I don't think we want to give specific guidance on that. But I think for the full year, we'll probably come in a bit above 7%. Sergio, anything you want to add there?

所以我認為在第四季度，我們可能會略高於 7%。我認為我們不想就此提供具體指導。但我認為全年的增長率可能會略高於 7%。 Sergio，你還有什麼要補充的嗎？

No, Stu, well said and covered. So that's accurate.

不，斯圖，說得很好，也很全面。所以這是準確的。

Okay. Great. And then I think you mentioned that you guys did raise prices in the quarter. Did you guys say how much that contributed to the growth? I guess I was just looking for kind of like pricing versus volume?

好的。偉大的。然後我想你提到你們確實在本季度提高了價格。你們有沒有說過這對增長有多大貢獻？我想我只是在尋找價格與數量之類的東西？

That's on a year-over-year basis, we raised prices. There was almost no price action in the current quarter.

與去年同期相比，我們提高了價格。本季度幾乎沒有價格波動。

Got it. Okay. And then, I guess, last one for me, just on the wellness shop, sounds like it's going really well. I guess, has it grown at all, to a material piece of the business? And then also, I was curious, are you seeing primarily existing customers kind of adding on to their order? Wellness products or are you also seeing it drive new customers to the site?

知道了。好的。然後，我想，對我來說最後一個，就在健康商店，聽起來進展得很順利。我想，它是否已成長為業務的重要組成部分？然後，我很好奇，您是否看到主要是現有客戶在添加他們的訂單？健康產品或者您是否也看到它吸引了新客戶到該網站？

So I'll start with the second part of that question. which is really we offer this primarily to our existing customers because that's a really robust base of demand that we can both go to grow the business, but also really learn with to make sure we get the offering to a place where it's first class.

所以我將從該問題的第二部分開始。事實上，我們主要向現有客戶提供此服務，因為這是一個非常強大的需求基礎，我們既可以發展業務，又可以真正學習以確保我們將產品提升到一流的水平。

So you're right that it's strategic. It's a big driver of net revenue per order. But we're really focused today on offering it to our existing customers. Both to get quick traction and to drive quick learning. And the first part of the question was about the materiality of the sales there. I just want to confirm.

所以你說得對，這是戰略性的。這是每個訂單淨收入的重要推動力。但我們今天真正專注於向現有客戶提供它。既能獲得快速牽引又能推動快速學習。問題的第一部分是關於那裡銷售的重要性。我只是想確認一下。

Yes. It sounds really like it's kind of doing well out of the gate. I'm just curious, I guess, is it -- has it gotten to a percent of the business that's not necessarily significant, obviously, but where it's material, I guess, where you could see it kind of moving the new dollars to look forward.

是的。聽起來確實像是一開始就做得很好。我只是好奇，我想，它是否已經占到了業務的一定比例，顯然，這不一定是重要的，但我想，它是重要的，你可以看到它在某種程度上轉移了新的美元向前。

Sergio, do you want to take this one? Okay, I will.

塞爾吉奧，你想買這個嗎？好吧，我會。

So I think from a materiality perspective, it's still mid-single digits. So it's not driving the overall top line but customers who buy a wellness product tend to have net revenue per order around $80 or even a bit higher, which is obviously materially higher than our overall net revenue per order today.

所以我認為從實質性角度來看，它仍然是中個位數。因此，它並沒有推動整體營收，但購買健康產品的客戶往往每筆訂單的淨收入約為 80 美元，甚至更高一點，這顯然大大高於我們今天每筆訂單的總體淨收入。

So as we look ahead to net revenue per order growth, we view wellness as one of the places where we can sustainably build on our current basket sizes, deliver more value for our customers. And of course, that incremental dollar of net revenue per order of average order value is quite margin accretive. So we really like that.

因此，當我們展望每訂單淨收入的增長時，我們將健康視為我們可以在當前購物籃規模的基礎上持續發展、為客戶提供更多價值的領域之一。當然，平均訂單價值中每筆淨收入的增量美元是相當可觀的利潤增值。所以我們真的很喜歡這樣。

So it's already having a real effect in terms of driving net revenue per order higher. But in terms of driving overall revenue, I think we're a little early to say. It's a big driver, but hopefully soon.

因此，它已經在提高每份訂單的淨收入方面產生了實際效果。但就推動整體收入而言，我認為我們現在說還為時過早。這是一個很大的推動力，但希望很快就會實現。

Yes, sorry, just -- sorry, Susan. Just adding on top of that, I was on mute, and I was starting to answer the question, and then I heard Stu.

是的，對不起，只是——對不起，蘇珊。除此之外，我處於靜音狀態，我正開始回答問題，然後我聽到了斯圖的聲音。

So basically, the way that we see this is the mix that we have been referring as to the value creation. So this part of the mix is early days still to talk about the long term. But rest assured that changing the mix into these categories is something that will be accretive to the company in the long run.

所以基本上，我們看待這一點的方式就是我們一直提到的價值創造的組合。因此，這部分組合還處於早期階段，無法討論長期目標。但請放心，從長遠來看，將組合轉變為這些類別將為公司帶來增值。

And we are seeing good success at the moment. So we wouldn't call out specifics, but Indeed, we are excited with the opportunity ahead.

目前我們看到了良好的成功。因此，我們不會透露具體細節，但事實上，我們對未來的機會感到興奮。

(Operator Instructions) Our next question comes from Dana Telsey with Telsey Group.

（操作員說明）我們的下一個問題來自 Telsey Group 的 Dana Telsey。

Good afternoon, everyone, and nice to see the progress. Welcome, Jeff and Stu, Glad you're still very, very much involved. As you think about the expense reduction this quarter, which obviously, advertising expense was significant, but it looks like there was a decline in fulfillment costs also. Does that continue going forward?

大家下午好，很高興看到進展。歡迎，傑夫和斯圖，很高興你們仍然非常非常參與其中。當您考慮本季度的費用減少時，顯然，廣告費用很大，但履行成本似乎也有所下降。以後還會繼續這樣嗎？

Or how do you see the buckets of expense transform as we go back to putting in some ad expense nearing the fourth quarter? And then I have a follow-up.

或者，當我們在第四季度附近重新投入一些廣告費用時，您如何看待費用支出的變化？然後我有一個後續行動。

Go for it, Sergio.

加油吧，塞爾吉奧。

Thank you for the question. So basically, if I understood the spirit of the question is getting a sense on how this is going to translate going forward. I would say that yes, what you saw -- thank you for confirming, what you saw on Q2 in terms of fulfillment costs and reductions. Yes, it's going to continue the trend, has been one that we feel really proud about the efforts that the team have achieved in terms of reducing -- controlling the expense in spite of inflation.

感謝你的提問。所以基本上，如果我理解了這個問題的精神，那就是了解這將如何轉化為未來。我想說的是，是的，您所看到的——感謝您確認您在第二季度所看到的履行成本和減少方面的情況。是的，它將繼續這一趨勢，我們對團隊在減少成本方面所做的努力感到非常自豪——儘管存在通貨膨脹，但仍控制了開支。

And this has to do with jumping into regional carriers across the board that is helping us basically control the cost. So I don't know if that answers your question, but that's part of the principal, why you are seeing it, and we will continue to see this trend.

這與全面進軍區域運營商有關，這有助於我們基本上控製成本。所以我不知道這是否回答了你的問題，但這是原則的一部分，為什麼你會看到它，我們將繼續看到這種趨勢。

And will it be at this magnitude of the $2 million or so go forward?

未來會達到 200 萬美元左右的規模嗎？

Not at this magnitude because the first chunk is the important one, but we'll -- continue to be savings coming from that for sure.

不是這麼大，因為第一塊是重要的，但我們肯定會繼續從中節省開支。

And when you think of the path to profitability and getting near breakeven in the third quarter, as you think about next year and just the path of advertising and that path to profitability, how do you think of the advertising spend going forward?

當您考慮盈利之路並在第三季度接近收支平衡時，當您考慮明年以及廣告之路和盈利之路時，您如何看待未來的廣告支出？

So I think, sure. Yes, I'll start it. It's a great question, Dana. So we've been, first and foremost, focused on advertising efficiency and return on ad spend and LTV to CAC, of course. So if you think about year-over-year where we've come on that. We've seen huge improvements there. And we continue to be focused on making sure not only are we driving a really good return, but we're focused on optimizing down to make sure our advertising spend is more effective.

所以我想，當然。是的，我會開始。這是一個很好的問題，達納。因此，我們首先關注的是廣告效率、廣告支出回報以及 CAC 的 LTV。所以，如果你想想我們在這方面的年復一年的進展。我們在那裡看到了巨大的改進。我們繼續專注於確保我們不僅能帶來真正良好的回報，而且我們專注於優化以確保我們的廣告支出更有效。

We've said a lot of times that we're targeting, this is not guidance, but just focused on finding the way to profitable growth in 2024. And so would love to see advertising spend at least flat to potentially a little bit up year-over-year in 2024. But we're still building the plan that drives profitable growth in 2024.

我們已經多次說過，我們的目標不是指導，而是專注於尋找 2024 年盈利增長的方法。因此，我們希望看到廣告支出至少持平，甚至可能略有增長- 2024 年同比增長。但我們仍在製定推動2024 年盈利增長的計劃。

I think throughout the balance of the year, you can expect that it will continue to be a seasonally -- we will continue to spend seasonally more in Q1 and in sort of end of Q3, beginning of Q4, as I mentioned, for those seasonally strong periods. But I think you're right to say, hey, we're going to be more focused on making sure that we have enough advertising to drive growth as we get to profitability.

我認為在今年的剩餘時間裡，你可以預期它將繼續是季節性的——我們將繼續在第一季度、第三季度末、第四季度初增加季節性支出，正如我提到的，對於那些季節性支出強時期。但我認為你說得對，嘿，我們將更加專注於確保我們有足夠的廣告來推動我們實現盈利時的增長。

Got it. And then can you talk about how the quarter went? Was one month stronger than another? What did you see in terms of the Amazons and some of the new channel. New partnerships like Kroger and Hannaford, was there a difference in sell-through and also your brand and third-party brands in terms of what you're seeing.

知道了。然後您能談談這個季度的情況嗎？某個月比另一個月強嗎？您在亞馬遜和一些新渠道方面看到了什麼？像克羅格和漢納福德這樣的新合作夥伴，在銷售量以及您的品牌和第三方品牌方面是否存在差異？

So the quarter was fairly balanced and strong throughout. I think we continue to find that if you look at our net revenue per order and our gross margin, those are sequential trends. And so if it's getting better quarter-over-quarter, it's probably also generally getting better month-over-month, not every month better than the last. But in general, sort of those things tend to grow month -- tend to be growing on a sequential basis. And so through the quarter, I think we saw pretty consistent demand. We felt very good about our performance on Prime Day, but we're very early there. So that's still -- it's growing at a great clip, but still very small.

因此，整個季度相當平衡且強勁。我認為我們繼續發現，如果你看看我們每筆訂單的淨收入和毛利率，這些都是連續趨勢。因此，如果每個季度都在好轉，那麼通常每個月也會好轉，而不是每個月都比上個月好。但總的來說，這些事情往往會按月增長——往往會連續增長。因此，在整個季度中，我認為我們看到了相當穩定的需求。我們對 Prime Day 的表現感覺非常好，但我們來得太早了。所以它仍然在以很大的速度增長，但仍然很小。

And through the quarter, I think, look, we've clearly been driving this business to operate as close to profitability as possible. And so with the gross margin and overall margin improvements that are rolling out sequentially, we do see those improvements rolling in monthly on a sequential basis. I hope that answers the question.

我認為，整個季度，我們顯然一直在推動這項業務盡可能接近盈利。因此，隨著毛利率和整體利潤率的改善相繼推出，我們確實看到這些改善每月都會連續出現。我希望這能回答這個問題。

There are no additional questions at this time. I'd like to now turn the conference back over to our presenters for any closing remarks.

目前沒有其他問題。現在我想將會議轉回給我們的主持人做總結髮言。

Thank you. Thanks, everyone, for joining. Again, a huge thank you to the Grove team for exceptional progress this quarter and a huge welcome to Jeff. Excited to see all of the great things this next chapter holds for Grove. Thanks so much, everyone. Good luck.

謝謝。謝謝大家的加入。再次非常感謝 Grove 團隊在本季度取得的出色進展，並對 Jeff 表示熱烈歡迎。很高興看到下一章為格羅夫帶來的所有偉大的事情。非常感謝大家。祝你好運。

Thank you, ladies and gentlemen. This concludes today's presentation. You may now disconnect.

謝謝你們，女士們、先生們。今天的演講到此結束。您現在可以斷開連接。