SALT LAKE CITY – Total revenue for e-commerce site Overstock came in at $732 million for the third quarter ending Sept. 30, a 111% increase over the previous year’s third quarter.
“After a record-setting second quarter, we maintained our momentum, continued to outperform expectations, and grew faster than competitors in the third quarter,” said Jonathan Johnson, Overstock CEO. “Our quarterly gross sales in our retail business doubled year-over-year once again, and new customers grew 141%. These new customers are making repeat purchases at an increasing rate.”
Johnson added that heading into the fourth quarter, he is confident that the retail business will maintain sustainable, profitable market share growth.
The company’s gross profit was $171 million or 23.0% of total net revenue, an improvement of 330 basis points year-over-year. And, net income attributable to stockholders of Overstock.com was $23 million, an improvement of $54 million over last year. Diluted earnings per share was 50 cents , up $1.39 over 3Q 2019.
Other highlights of the third quarter include that gross sales from orders placed on a mobile device were more than 50% of retail sales in this year’s third quarter compared with 44% in the third quarter of 2019. On the quarterly earnings call, Johnson said he believes that the growth in mobile is more operationally derived than pandemic-derived and that the mobile initiatives they are working on for 2021 should help continue to drive growth.
“We have seen a significant spike and now estimate that 35% of home furnishings are being purchased online,” Johnson said on the call. “Overstock has been able to keep growing at more than 100% even as brick-and-mortar stores came back in Q3.”
Also on the earnings call, Johnson said the 21-day repeat purchase rate is up 19% year-over-year.
“We believe there is an opportunity for Overstock to obtain 40% of the customer share, which translates to $120 billion,” Johnson added. “We are leaning into the white space of segments of people who are deal driven and want to feel great about their purchases and have a low hassle shopping experience.”
Also on the earnings call, the company shared that a challenge for the current fourth quarter will be that carrier constraints will cause lagging delivery times. With the predicted earlier than usual holiday shopping season, they are trying to be as proactive as possible by sharing their forecast with their primary carriers to ensure adequate trailers and trucks are available.
“We have found in the current environment that accuracy in the delivery time matters more than speed for large parcel items,” Johnson said.