Dive Brief:
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Ahead of a shareholder vote to approve its acquisition by Northern Star Acquisition Corp., Bark on Tuesday reported preliminary fourth quarter and fiscal 2021 financial results. The company reported net revenue in the quarter increased 79% year over year to $112.2 million.
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DTC revenue increased 79.3% to $101.3 million, while commerce revenue — which consists of product sales to retailers and through marketplaces — increased 76.8% to $10.9 million. Net loss for the quarter grew to $7.1 million from $4.1 million in the year-ago period, according to a company press release.
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For the full fiscal year, Bark's revenue increased 68.8% to $378.6 million, while net loss remained flat at $31.4 million.
Dive Insight:
The parent company of BarkBox and Super Chewer is soon set to make its public market debut following a May 28 shareholder vote to approve the SPAC deal. The merger comes as such deals face a slowdown after a rapid rise this past year, as the Securities and Exchange Commission takes a harder look at the IPO method.
Bark has benefited from increased categorical demand this past year as existing and new pet owners allocated more spending toward their animals. Even with the economic uncertainty the pandemic brought on, the pet category historically has been fairly resistant to recessionary periods.
But even prior to the onset of COVID-19, Bark had a strong presence online, a place more consumers were turning.
The company this past year added 1.2 million new subscriptions, up 91.4% year over year, for a total of 1.8 million active subscriptions. But acquiring customers while selling primarily online has also revealed its limitations.
During the year, Bark spent more than $67 million on marketing, a 45.3% increase from the prior year. Marketing as a percentage of total net revenue for the year was 17.7%.
The cost to acquire customers when operating largely online is something other DTC brands have struggled with as well. Wayfair and Chewy only recently have been able to reach a positive net income, while Casper has yet to reach profitability.
To help combat this, digitally native brands often enter physical retail, through partnerships, pop-up stores or permanent locations. To that end, Bark has forged partnerships with retailers like Costco, Amazon and Target, and said it will "continue the expansion of retail distribution, online marketplaces, and brand partnerships" in the future, according to a company presentation.
For the year ahead, Bark expects net revenue to reach $516 million and net loss to widen to $41 million.
