Grove Collaborative released its financial results for the fiscal first quarter ending on March 31, 2024. Net revenue amounted to $53.5 million, marking a 10.5% decrease from the fourth quarter of 2023 and a 25.2% decline year-over-year.
These consecutive and year-over-year drops primarily stem from reduced Direct to Consumer (“DTC”) orders, attributed to decreased advertising expenditures throughout 2023 and the initial quarter of 2024. The company allocated a historically low percentage of revenue to advertising in the first quarter of 2024, emphasizing marketing efficiency and a shift in its business model. Despite the decline in orders compared to the previous year, there was a partial offset by an increase in Net Revenue per order.
Operating Expenses amounted to $30.3 million, reflecting a 25.3% decrease from the fourth quarter of 2023 and a 40.5% decline year-over-year. These consecutive and year-over-year reductions primarily stem from lower fulfillment costs due to decreased orders, reduced personnel and facility expenses, and decreased advertising expenditure.
In the first quarter of 2024, operating expenses include a $2.9 million gain from restructuring, mainly related to the modification of the company’s headquarters lease. This contrasts with the fourth quarter of 2023, which saw a $3.3 million expense from restructuring.
The Net Loss was $3.4 million, with a margin of (6.3%), compared to $9.5 million, with a margin of (15.8%) in the fourth quarter of 2023, and $13.1 million, with a margin of (18.3%) in the first quarter of 2023.
Direct to Consumer (DTC) Total Orders reached 0.8 million, experiencing a 10.5% decrease quarter-over-quarter and a 29.5% decline year-over-year. These declines, both sequentially and year-over-year, were primarily driven by reduced advertising expenditure.
DTC Active Customers, referring to the number of customers placing orders within the trailing twelve months, amounted to 0.8 million, reflecting a quarter-over-quarter decrease of 12.3% and a year-over-year decline of 35.0%. Similarly, these declines were attributed to reduced advertising spend.
DTC Net Revenue Per Order stood at $66.27 in the first quarter of 2024, marking a 0.8% decrease quarter-over-quarter but a 7.5% increase year-over-year. The year-over-year improvement was driven by a shift in the order mix towards existing customers and an increase in the number of units per existing customer order as the company expanded its product range.
