Bird's Guidance Won't Fly

Shares of Bird Global Inc. (NYSE:BRDS) dropped by over 20% in Wednesday morning trading after the Santa Monica, California-based company posted its results for the fourth-quarter and full year of 2021, together with lower-than-anticipated guidance.

On a per-share basis, the scooter-sharing company, which went public in November 2021, posted a loss of 24 cents, which was better than the loss per share of 34 cents that analysts surveyed by FactSet had expected.

Despite the earnings beat, though, investors are looking to the future, and Bird Global has released disappointing guidance.

The company said it expects first-quarter revenue of $34 million to $36 million, below the $51.4 million analysts had been expecting," according to FactSet. Bird also said it expects full-year revenue of at least $350 million, well below the $384.1 million that analysts surveyed by FactSet were expecting,

The stock traded more than 20% lower at $2.75 a share Wednesday morning and is down almost 55% so far this year.

Bird's Guidance Won't Fly
Bird's Guidance Won't Fly

Fourth-quarter revenue also topped expectations, more than doubling to $54 million in the face of last winters Omicron outbreak. Analysts had projected the revenue would be $50.8 million. The net loss widened to $39.6 million, more or less in line with analysts projected $39.7 million net loss.

Travis VanderZanden, founder and CEO of Bird, said in a statement, We are very pleased with our strong finish to fiscal 2021. We exceeded our increased expectations for the year by capitalizing on the momentum driven by easing pandemic-related restrictions and continued adoption of micromobility by people and cities across the globe. During the fourth quarter, rides increased over 100% year-over-year despite macro-related headwinds including the surge in Omicron cases late in the period.

VanderZanden added that throughout the first quarter, Bird executives had seen a sequential increase in demand as Omicron cases declined and weather has improved. They expect demand to continue to build as more riders seek environmentally friendly transportation alternatives from gas-powered cars. For the months ahead, Birds strategic initiatives will include vehicle innovation, operational advancement and global expansion.

For the fourth quarter, the gross margin (net of vehicle depreciation) was 15%, representing a 23 percentage point increase compared to the prior-year period. Ride profits (before vehicle depreciation) were $23.8 million, representing an increase of 181% compared to $8.5 million in the prior-year period. Ride profits as a percentage of sharing revenue were 53% compared to 41% for the prior-year period.

Total operating expenses were $136.6 million, including $82.3 million of non-cash stock-based compensation expense. Adjusted operating expenses, which excludes the non-cash stock-based compensation expense as well as certain non-cash, non-recurring items or non-core expenses, increased 28% year-over-year.

Full the full year, the company said revenue was $205.1 million, representing an increase of 117% compared to $94.6 million in 2020. The year's gross margin was 19%, representing a 44 percentage point increase compared to the prior year. Ride profits were $91.3 million compared to $15.7 million in 2020.

This article first appeared on GuruFocus.