Mood at Blue Apron Remains High Despite Dip in Q1 Profits

Despite net revenue taking a 9% dip year over year to $117.8 million and net loss of $38.4 million, the mood at Blue Apron remains high as the company announced its first-quarter results on May 9. Adjusted EBITDA in the quarter showed a loss $30.7 million, compared with an adjusted EBITDA loss of $6.1 million in the first quarter of 2021.

“The first quarter was another period of strong execution for the Blue Apron team," said President and CEO Linda Findley in a statement. “We continue to make progress on the foundational work we started back in 2019, and then accelerated in the fourth quarter of last year as we look to scale the business and drive customer growth. Targeted marketing investments aimed at improving brand awareness and reach, along with our innovative menu, strong product offering and seasonality, drove a 9.2% quarter-over-quarter increase in customers, and we expect to continue to grow customers in the second quarter.”

For the period ending March 31, Blue Apron said revenue increased by 16% from the pre-pandemic first quarter of 2020 to $118 million as the company gains traction on its growth strategy.

The New York-based meal kit company said key customer engagement metrics performed at elevated levels for the eighth quarter in a row, reflecting continued traction of the company’s growth strategy. The average number of orders reached 1,869, compared to 1,678 from fourth-quarter 2021.

As planned, the company said marketing expenses rose 40% year over year to $28 million as it continues to drive growth in 2022.

“We continue to expand our product and menu selection, recently launching a new breakfast offering while adding new four-serving menu options and add-ons to meet evolving customer preferences," Findley added.

Having met its commitment to become carbon neutral by March 31, 2022, Findley said the company is now focused on implementing systematic reductions to achieve “our longer-term goal of achieving net zero. We look forward to providing more information on this and many other parts of the business at our inaugural investor day tomorrow, May 10.”

Blue Apron will host its inaugural investor day at the company’s fulfillment center in Linden, N.J. The company said members of Blue Apron’s management team will discuss the company’s mid- to long-term strategic plans and outlook, operations, marketing, technology, sustainability and financials, among other topics. A question-and-answer session will follow management’s prepared remarks.

Following the end of the first quarter, the company announced a $70.5 million capital infusion through debt and equity financings: extending debt maturity through 2027.

“We continued to build on the momentum generated in the fourth quarter of 2021 to propel our first-quarter performance, including material investments in marketing and our people while navigating a challenging inflationary environment,” said Randy Greben, Blue Apron’s CFO, in a statement. “Total net revenue grew 10% over the fourth quarter of 2021 to $118 million, and we saw continued strength in our key customer engagement metrics including, average order value, average revenue per customer and orders per customer.

Greben said that variable margin was a challenge at the beginning of the quarter but rebounded in the month of March.

“After the end of the quarter, we also successfully refinanced our senior secured term loan and announced a $40.5 million equity capital raise. When we complete the expected remaining $20 million private placement transaction at the end of this month, we expect to have approximately $80 million in cash, and we expect positive operating cash flow this quarter," he said. 

Proceeds from the transactions are expected to support Blue Apron's continued turnaround as it drives toward long-term sustainable growth, Greben added.