Following the disappointing figures reported in their fourth-quarter earnings for 2018 published on March 18, 2019, Overstock’s CEO has said that there will be a change in fortunes this year and that their tZero platform is still promising.
Overstock’s foray into blockchain has been a rather impressive one and made headlines when it was announced last year and since then, they have expanded their efforts into projects like land registration.
Despite all the fanfare surrounding the tZERO platform, its first year of operation got off to a rocky start. This was revealed via Overstock’s recently released earnings report for the last quarter of 2018 that were published on March 18, 2019.
While the earnings report shows significant losses for the Canadian online retail giant, their CEO has stated that this will be corrected in the near future.
Taking Stock of Losses
A quick look at the earnings report will show that the company reported revenue of $452.5 million versus the $456.3 million they recorded in the fourth quarter of 2017, which represents a 1 percent decrease. They also reported a gross profit of $81.6 million versus the $85.8 million That was made in the fourth quarter of 2017 which is a 5 percent decrease. Also, the net loss for their retail arm was $27.7 million, which is an increase of $10.1 million from the fourth quarter of 2017.
Their CEO, Patrick M. Byrne, explained the losses in a letter to investors by stating that they were due to a change in company strategy. Overstock had decided to take a risk on e-Commerce business but eventually reverted after experiencing the losses.
Promising a positive operating cash flow of at least $10 million in 2019, he said:
“Our retail arm lost money last year because I gunned things in an attempt to create a conventional high-growth/money losing e-commerce business, but the losses were nauseating and we reverted back to the philosophy of profitability on which we built Overstock,”
As for their Blockchain arm, tZero, Byrne has stated that he still has faith in m despite the setbacks, which included $12.6 million in pre-tax losses for the platform.
According to him, tZERO is one of the best platforms in the world with cutting edge projects that are about to be introduced to the public. He also touched on tZERO’s achievements, including delivering a live a security token trading platform.