BARK, Inc. Q3 FY2025 earnings call

• Closed 2024 strong, surpassed revenue expectations, 10th consecutive adjusted EBITDA YOY improvement. • DTC had highest new subscriptions in 3 years, up 11% YOY at lower cost. • Commerce revenue up 43% YOY, added new partners and expanded shelf space. • Transitioned paid media to Shopify platform, early results encouraging, new subscriptions up 11% YOY at lower cost. • Marketing strategy shifted to upper funnel. • Leadership team driving progress, supply chain improvements in DTC.

Total revenue for the quarter was $126.4 million, 1% YOY. DTC segment contributed $106.1 million (including $2 million from BARK Air), down 4% YOY. Commerce segment revenue grew 43% YOY, last quarter over $20 million, YTD up over 25%. BARK Air delivered $2 million revenue last quarter with positive gross profit.

• Full year revenue expected $490M-$500M (flat to 2% YOY). • Adjusted EBITDA expected $1M-$5M for full year. • Fiscal 2026 expected mid to high single-digit top line growth, formal guidance in June.

• Uncertainty with platform transition. • Industry headwinds. • Supply chain challenges in DTC (e.g., shipment delays). • Tariffs impacting two-thirds of volumes, but proactive measures in place to mitigate impact.

Q: On DTC segment trajectory to revenue growth and mid to high single-digit growth in 2026?

A: Stabilization in 2026, most growth from Commerce channel.

Q: Strategic vision for BARK Air?

A: Too early to call material driver, but good opportunity with asset-light model.

Q: Commentary on fourth quarter guidance and shelf resets?

A: Shelf resets in March/April cause timing variability, impact from retailer shipments.

Q: Chewy business trend?

A: Started with 30 SKUs in June, expanded to over 150, strong momentum.

Q: DTC new subs and marketing strategy shift?

A: 99% due to Shopify transition and upper funnel shift, learning and reinvesting efficiency gains.

Q: EBITDA outlook for fiscal 2026?

A: Good year-over-year improvement, steady EBITDA margin improvement with scale.

Q: DTC marketing strategy and Shopify efficiency?

A: Shift to upper funnel, reinvesting Shopify efficiency gains into awareness building.

Q: Commerce international opportunity?

A: Combination of new leadership, expanding with underserved customers, international launches like Amazon Europe, partnerships with Girl Scouts and others.