Tuesday, January 31, 2023
HomeNewsOverstock Postpones Selling It’s E-Commerce Business, Deferring Cash Flow for Crypto Ventures

Overstock Postpones Selling It’s E-Commerce Business, Deferring Cash Flow for Crypto Ventures

Overstock was reportedly planning to sell its flagship e-commerce business and utilize the cash inflow to build-up its portfolio of blockchain ventures., however, the platform has decided to put any such plans on hold. 

CEO Patrick Byrne indicates in a conference call to discuss fourth-quarter results Monday, that they have decided to switch from its original plan aimed at selling its retail business end of February, stating that there is no firm timeline as of yet. He told the shareholders:

“It’s like preparing a souffle, and a souffle is ready when it’s ready.”

Byrne instead conversed in a way that suggested that  Overstock is expecting to hold on to its original business for a while, asserting that as per him the retail unit expects “a year of explosive growth,” and subsequently “spit out cash” while the company continues to build the blockchain ventures.

Last month, during an interview with COinDesk, Byrne did hint to something like this when he stated that he was managing the retail business as if I’m going to own it forever.” As of now, keeping the unit means that Overstock is not turning into a pure-play blockchain company for a while at least. 

Jonathan Johnson, the president of Medici Ventures, the company’s blockchain investment arm, stated last year that selling the retail business would leave Overstock with Medici and entails a “bag of cash.”

A particular assertion in the risk factors section of the Securities and Exchange Commission’s annual report released on Monday is in  conjunction with quarterly results. Subsequently, Overstock warned that selling their  retail business at this stage, would shrink its revenues “to an insignificant amount,” adding:

“Our retail business is a relatively mature and predictable business compared to our Medici initiatives, which have a short history, minimal revenues, significant expenses, significant losses and significant uncertainties, and conduct business in a new and rapidly changing industry.”

Moreover, as per the filing, the sale would make Overstock “a much smaller company.” tZERO and the retail business of Overstock have posted pre-tax losses in Q4: $12.6 million and $27.7 million, respectively, the net loss of both the companies is significantly higher than a year earlier.

Read more:Crypto Exchange Bithumb To Lay Off 50% Of Its Staffing Levels

Image source CNBC.com



Most Popular