abstract：The California-based sustainable footwear brand has appointed its current COO, Joe Vernachio, to replace Joey Zwillinger as CEO, amid a slump in sales

Allbirds’ current Chief Operating Officer Joe Vernachio has been appointed Chief Executive Officer and a member of the Board of Directors, effective from the 15th of March. He succeeds Joey Zwillinger, co-founder and CEO of Allbirds, who will remain a member of the Board of Directors and serve as a special advisor.

Vernachio joined the company in June 2021 as COO, but in 2023, he undertook increased responsibilities, including oversight of commercial and international functions and operations. With decades of experience in the retail industry and a strong track record of building enduring brands – counting four years as President of Mountain Hardwear, where he led the brand to profitability – he is now expected to continue to drive Allbirds’ strategic transformation plan.

“The Company made meaningful progress in 2023 both operationally and financially, ending the year in a much stronger position. With the transformative actions we completed over the past year, coupled with world-class leadership, I am confident in the team, and in particular, Joe Vernachio’s stewardship of the brand for this next chapter for Allbirds”, said Joey Zwillinger, Chief Executive Officer, as the company reported its fourth quarter and full year results.

In the fourth quarter of fiscal 2023, Allbirds’ net revenue decreased by 14.5% to 72.0 million US dollars, on a comparable basis to the same period of the prior year. The company also experienced a wider net loss in this period, reaching 56.8 million US dollars, as compared to 24.9 million US dollars in the fourth quarter of 2022. Similarly, its adjusted EBITDA loss rose to 19.5 million US dollars from 12.5 million US dollars in the same quarter a year ago.

For the year ended on the 31st of December, Allbirds reported a net revenue decline of 14.7% year-over-year to 254.1 million US dollars. It also posted a full year net loss of 152.5 million US dollars, as compared to a full year net loss of 101.4 million US dollars in fiscal 2022. In the same line, its full year adjusted EBITDA loss increased to 78.4 million US dollars from 60.4 million US dollars in the previous year.

However, Joey Zwillinger highlighted that the company has “entered 2024 with a strong cash position, healthy inventory composition and volume, and a strengthened foundation”. The sustainable footwear company ended the year with 130.0 million US dollars of cash and cash equivalents, which indicates “a significant improvement in operating cash use versus a year ago”. In addition, its inventories totalled 57.8 million US dollars, a decrease of 50.5% as compared to 116.8 million US dollars at the end of 2022.

Fiscal 2024 Outlook

For full year 2024, Allbirds expects to achieve net revenue between 190 and 210 million US dollars and an adjusted EBITDA loss of 78 to 63 million US dollars. This outlook reflects approximately 32 to 37 million US dollars of negative impacts associated with the transition from a direct to a distributor model in international markets, as well as the expected closure of 10 to 15 Allbirds stores in the US.

Image Credits: drapersonline.com

Source: world footwear