Bed Bath & Beyond (BBBY) Q1 2026 earnings summary

Executive summary

• Revenue grew 6.9%–7% year-over-year to $247.8–$248 million, marking the first significant growth in 19 quarters, with operating costs at a multi-year low.

• Net loss improved to $16–$16.4 million, a $24 million year-over-year improvement, and adjusted EBITDA loss improved by $5–$5.4 million to $(7.9)–$(8) million.

• The business is being rebuilt around an omni-channel ecosystem, integrating recent and pending acquisitions such as Kirkland's, The Container Store, F9 Brands, and The Brand House Collective.

• Strategy focuses on leveraging technology, data, and AI to drive efficiency, customer engagement, and lifetime value.

• Active customers stabilized at 3.95–4.0 million, with order frequency at 1.31 and average order value up 6% to $205.

Financial highlights

• Net revenue reached $247.8 million, up 6.9% year-over-year; gross margin was 23.9%, down 120 bps.

• Adjusted EBITDA margin was -3.2% for Q1 2026.

• Cash and equivalents at quarter-end were $135.8–$163 million; cash used in operations improved significantly year-over-year.

• Sales & marketing expense was 13.0% of revenue, down 50 basis points year-over-year.

• Free cash flow improved to $(12.8) million from $(52.1) million year-over-year.

Outlook and guidance

• Management expects continued benefits from cost reductions, targeting $60 million in savings over nine months and positive free cash flow.

• Forecasts for 2027–2029 anticipate 6%–7% annual revenue growth, assuming stable macroeconomic conditions.

• Q2 and Q3 will include $13–14 million in one-time expenses related to acquisitions and restructuring.

• The TCS merger is expected to close in Q3 2026, subject to customary closing conditions.

• Management remains focused on profitability, capital returns, and leveraging partnerships and intellectual property.