In its most recent earnings report, internet retail pioneer and long-time cryptocurrency supporter Overstock published some strong losses. The report showed that the company saw a 23% decrease in revenue and a 19% loss in gross profit for the second quarter of 2019.
However, it wasn’t all bad news for Overstock. The report showed that the company has finally returned to a positive adjusted Earnings Before Interest, Taxes, Depreciation and Amortization for the first time since the second quarter of 2017.
The company’s gross margin has also seen a 79 basis point increase through the quarter. Meanwhile, they were able to cut down their sales and marketing expenses by 63% in the quarter as well.
Overstock’s Blockchain Business
Despite Overstock’s struggles, the company’s blockchain division is very strong. In a shareholder announcement published by Overstock on August 8, the company stated that it’s most notable blockchain project tZERO, which is set to soon open for retail investors, has been on target with meeting many of its roadmap expectations.
Still, these completed goals have come at a massive expense to the company. According to the numbers published by Overstock, tZERO showed nearly $10 million in pre-tax losses. These losses contributed to the overall decline in Overstock’s portfolio, but they are hoping that this investment will pay off in the future. The report stated that:
“G&A expenses totaled $32.0 million and $31.4 million in Q2 2019 and 2018, respectively, a 2% increase. The increase was primarily due to a $6.0 million decrease in cryptocurrency gains from our Q2 2018 sale of cryptocurrency received during the tZERO security token offering, with no similar activity in Q2 2019.”
Last month, Overstock announced that it will pay shareholders a sort of dividend in the form of shares of Overstock.com Inc.’s Digital Voting Series A-1 Preferred Stock (OSTKO). This news came just days after the company launched a cryptocurrency wallet and exchange application for Android devices.
In 2014, Overstock was one of the first major retailers to accept cryptocurrency, and they have since branched out with a variety of different associated projects. Last year, Overstock founder Patrick Byrne sold 774,303 shares of the company for over $20 million , and reinvested much of that capital into his new blockchain ventures.