Sales and marketing expense shrunk 13% to $47.5 million, but technology/G&A expenses spiked 53% to $82.5 million.
Pre-tax loss almost doubled to $49.9 million vs. $24.9 million a year ago. Retail pre-tax loss was $27.7 million, while that is tZERO was $12.6 million. Total revenue from Medici’s blockchain offering tZERO was $4.96 million in the quarter, which generated a gross profit of $1.56 million.
Quarterly net attributable loss shrunk to $42.3 million from last year’s $95.7 million, while net loss came down to $1.39 per diluted share from loss of $3.72 a share a year ago.
RETAIL OR BLOCKCHAIN?
Back in November, CEO Patrick Byrne, who is also a blockchain evangelist, hinted that Overstock does not want to be in e-commerce any more — rather, it is looking at transforming to a blockchain business.
CEO Byrne was expected to shed more light into the identity and the future of Overstock.com as the company posted results today. “Our blockchain projects are some of the most significant and cutting edge in the world, and we are just reaching the point where our products are being introduced to the public. In particular, tZERO brought live a security token trading platform, ” he weighed in, as the company posted a dip in losses.
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In line with the focus of blockchain, Overstock already launched an investing firm Medici Ventures — a public digital ledger of transactions on the blockchain technology. It is also said to be developing its own security tokens for e-commerce and trading.
“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 a result, in 2019 Retail will return to profitability, generating a positive operating cash flow ≥ $10M,” said CEO Byrne.