Blue Apron Holdings, Inc.

Net revenue was $106.2 million, down 6.1% sequentially and 14.5% year over year. Variable margin was 37.9%, up 210 basis points sequentially and 320 basis points year over year. Adjusted EBITDA was a loss of $2.6 million, versus a loss of $16.2 million in Q2 2022 and a loss of $8.7 million in Q1 2023. Net loss was $61.9 million, compared with $23.3 million in Q2 2022 and $17 million in Q1 2023; excluding the one-time non-cash transaction loss of $48.6 million, net loss was $13.3 million. Free cash flow was negative $6.1 million, an improvement of 69% year over year. Cash at quarter-end was approximately $30 million, versus $31.6 million in Q1. For 2023, management guided to revenue of $410 million to $415 million and adjusted EBITDA loss of $27 million to $23 million, and reiterated adjusted EBITDA profitability in Q2 2024 and full-year adjusted EBITDA profitability and year-over-year revenue growth in 2024.

Linda Findley framed the quarter as proof that Blue Apron’s turnaround and new asset-light model are working. She emphasized that the company is prioritizing profitability over aggressive customer acquisition, while still planning to lean slightly more into marketing in the second half because payback periods have improved to below one year. She was upbeat about the strategic shift to FreshRealm, saying it should improve efficiency, support new product launches, and create optionality for future strategic opportunities.

Mitch Cohen focused on balance sheet repair and the new financial structure. He said cash ended the quarter at approximately $30 million, the company is now debt-free, and eliminating the senior secured notes removes covenants and more than $2.5 million of annual interest expense. He also highlighted $7 million of expected annualized savings from the July corporate workforce reduction, the $3.5 million seller note receivable, and up to $4 million of additional FreshRealm cash consideration if milestones are met. He said the FreshRealm deal should lower fixed costs, including a 2024 baseline PTG&A fee of about $10 million, and that the company expects minimal capital investment going forward.

Analysts focused on the tradeoff between marketing spend, customer acquisition, and higher customer value. Management said it is targeting the “best customers,” not a large acquisition push, and sees room to slightly increase marketing because testing showed strong payback and conversion improvements. On macro demand and recent pricing, Linda said the consumer environment remains somewhat cautious, but repeat behavior is strong, orders per customer hit 5.3%, conversion improved 25% year over year, and the company remains priced at or below competitors.