Overstock reported a sales rise in the third quarter, although the company posted a net loss.
For the third quarter ended September 30, Overstock.com posted a company net loss of $3.1 million, or 12 cents per diluted share, versus a net loss of $2.1 million, or eight cents per diluted share, in the year-prior period. Total revenue was $441.6 million versus $391.2 million in the year-earlier quarter. Operating loss for the quarter was $5 million versus $3.4 million in the period a year previous.
Overstock pointed out that the 2016 third quarter results included a pre-tax charge of $3.9 million related to impairment of an international minority investment and bad debt expense for accounts receivable owed from the entity.
The company said the growth in revenue was primarily due to a 10% increase in orders, coupled with a 5% increase in average order size. These increases were partially offset by increased promotional activities, including coupons, site sales, and Club O Rewards due to its driving a higher proportion of sales using such promotions. Average order size also has increased in recent years due primarily to a sales mix shift into home and garden products, the company noted.
“The retail business is re-accelerating and is fundamentally sound,” said Patrick Byrne, Overstock founder and CEO. “It had a pre-tax loss of $900,000 in the third quarter, which included $3.9 million of impairment and bad debt expense related to an international minority investment. Our Medici business cost us $3 million pre-tax this quarter, but that was well worth it as we achieve real progress in our blockchain and fintech initiatives that others have yet to demonstrate.”