San Francisco-based footwear company, Allbirds, recently reported a 21.2% decrease in net revenue, amounting to $57.2 million, for the third quarter. This decline in revenue was primarily attributed to increased promotional activity and a decrease in units sold. Furthermore, the company faced a loss of $31.6 million during the quarter, which widened from a loss of $25.2 million in the same period last year.

Allbirds acknowledged that its Strategic Transformation Plan had a significant impact on its third quarter performance. Joey Zwillinger, co-founder and CEO of Allbirds, highlighted the progress made in reducing inventory, controlling costs, and effectively utilizing operating cash. As a result, the company achieved an adjusted EBITDA that exceeded expectations. Zwillinger emphasized the company’s strategy of transitioning from a direct distribution model to third-party distributors in key international markets.

In line with this strategy, Allbirds announced its entry into a non-binding letter of intent with a distributor partner in Japan and another distributor partner in Australia/New Zealand. The finalization of these partnerships is anticipated to occur in mid-2024.

Although Allbirds faced challenging sales performance in the third quarter, the company remains committed to achieving profitable growth and generating long-term shareholder value. Allbirds believes that its clear path and disciplined approach will enable it to fulfill these objectives. With the implementation of its Strategic Transformation Plan and the establishment of distributor partnerships in crucial markets, Allbirds is positioning itself for success in the global footwear industry.