Tough road ahead
On April 3, Blue Apron (APRN) announced the appointment of Linda Findley Kozlowski as its new president and CEO. She will succeed Bradley Dickerson effective April 8. Previously, Kozlowski was Etsy’s (ETSY) COO. Her experience in the e-commerce space is expected to benefit Blue Apron.
Blue Apron has an array of issues that the new CEO will have to address. The company’s revenues fell 24.2% to $667.6 million in 2018. The number of customers fell 25.3% to 557,000 last year. The fall in Blue Apron’s revenues and customer base last year reflects its decision to decrease its marketing spending and focus on high-value customers. Blue Apron is also facing intense competition from HelloFresh and supermarkets, like Kroger (KR) and Walmart (WMT), that sell meal kits.
Last year, Blue Apron’s performance suffered due to operational and supply chain issues. The company has been improving its fulfillment center in Linden, New Jersey, which is its largest facility. Blue Apron is transferring significant production volume from its fulfillment center in Arlington, Texas, to the Linden facility.
Blue Apron is also trying to improve its profitability by driving efficiencies in labor, food, and shipping costs. To improve the top line, Blue Apron is also entering strategic collaborations. In January, Blue Apron indicated that its partnership with WW (WTW), formerly known as “Weight Watchers,” has received a favorable response.
Blue Apron also partnered with Walmart’s jet.com and launched Blue Apron Knick Knacks on jet.com’s city grocery platform.
Analysts expect Blue Apron’s first-quarter revenues to fall 21.7% to $154.1 million in the first quarter. Analysts expect a lower adjusted loss per share of $0.06 compared to an adjusted loss per share of $0.17 in the first quarter of 2018.
For fiscal 2019, analysts expect the company’s revenues to fall 14.0% to $574 million. Analysts expect a loss per share of $0.28—compared to a loss per share of $0.63 in 2018.