Demand for Blue Apron meal kits increased during the pandemic but shares have fallen 20% in 2021 as vaccines roll out
Blue Apron Holdings Inc., which has seen its business improve over the course of the COVID-19 pandemic, has plans to continue on the growth path with help from a few key partnerships, including one with Walt Disney Inc.
The meal kit company (APRN) has partnered with Disney (DIS) for the June 18 release of the animated film "Luca" on Disney+. Luca is about one young boy who spends his summer eating his way around the Italian Riviera, according to a description on the Disney website ().
Blue Apron has created a menu tied to the movie.
This is the company's second partnership with Disney. The first was with the Oscar-winning film "Soul," for which Blue Apron created kid-friendly meal options, like Tempo Turkey Sloppy Joes with Shishito Peppers & Carrot Fries.
The company also has other partnerships planned, including one with Calm, the sleep and meditation app, and with WW International Inc. (WW), which will mark "WW approved" Blue Apron options.
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Blue Apron saw demand for (Apron says holiday sales are going better than expected, stock jumps)its meal kits ( ) increase alongside at-home meal preparation during the pandemic.
Last week, the company reported first-quarter earnings that fell short of expectations, though revenue beat the Street.
Blue Apron's net loss totaled $15.7 million, or 88 cents per share, after a loss of $20.1 million, or $1.51, the prior year. Revenue totaled $129.7 million, up from $101.9 million, in 2020. The FactSet consensus was for a loss of 86 cents per share and revenue of $127.0 million.
The number of customers rose to 391,000 from 376,000 for the period ending March 31, 2020. Average order value was up to $61.63 from $57.68 last year. And average revenue per customer was up to $331 from $271 in 2020.
On Monday, Blue Apron announced a series of new products, including Butcher Bundles that allow customers to stock up for a week of meal prep, the Craft Burger, an "elevated" version of the company's burger option, and add-ons that will let customers put another appetizer, side dish or dessert in their box.
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During the Thursday earnings call, Chief Executive Linda Kozlowski highlighted a number of other measures the company has taken over the past couple of years in order to attract "high-quality customers."
"Affinity for the Blue Apron brand is the foundation on which we are building and launching our new products and operating efficiency initiatives," Kozlowski said, according to a FactSet transcript.
For the second quarter, Blue Apron expects net revenue of $122 million to $126 million. The FactSet consensus is for revenue of $124.3 million. Canaccord Genuity analysts note that this guidance implies a year-over-year decline of about 5%.
"Blue Apron benefited from both new product initiatives and heightened marketing efforts, noting sustained levels of elevated customer order value despite vaccinations and increased travel," analysts said.
Still Canaccord warns that the company "will need to keep a close eye on liquidity, ending Q1 with $29.6 million in cash and likely to burn more over the next two quarters."
Canaccord rates Blue Apron stock buy with a $12 price target, down from $14.
Blue Apron shares have tumbled 29.6% over the past month, and are down nearly 20% for the year to date. The benchmark S&P 500 index has gained 11.5% for 2021 so far.
-Tonya Garcia; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
May 11, 2021 08:26 ET (12:26 GMT)
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