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Qurate Retail, Inc. Reports Fourth Quarter and Year End 2018 Financial Results

ENGLEWOOD, Colo.--(BUSINESS WIRE)--

Qurate Retail, Inc. ("Qurate Retail") (Nasdaq: QRTEA, QRTEB) today reported fourth quarter and year end 2018 results. Highlights include (1):

Fourth quarter and full year 2018 operating results:

  • Qurate Retail revenue grew 1% to $4.4 billion in Q4 and grew 2% to $14.1 billion in full year 2018
    • eCommerce revenue of $2.7 billion or 62% of total revenue in Q4 and $8.3 billion or 59% of total revenue in full year 2018
  • Qurate Retail reported diluted EPS of $0.61 in Q4 and $1.45 in full year 2018
    • Adjusted EPS(2) of $0.62 in Q4 and $1.86 in full year 2018
  • QVC US increased revenue 3% in both Q4 and full year 2018 as reported
    • Revenue increased 2% in both Q4 and full year 2018 on a comparative basis excluding impact of new accounting standards regarding credit card income
  • QVC International revenue declined 3% in Q4 and increased 4% in full year 2018 as reported
    • Revenue declined 1% in Q4 and increased 1% in full year 2018 in constant currency(3)
  • HSN revenue declined 1% in Q4 and declined 6% in full year 2018 as reported
    • Revenue declined 1% and 7% in Q4 and full year 2018, respectively, on a comparative basis excluding impact of new accounting standards regarding credit card income
  • zulily revenue increased 6% in Q4 and 13% in full year 2018
    • Revenue increased 5% and 12% in Q4 and full year 2018, respectively, on a comparative basis excluding impact of new accounting standards regarding credit card income
  • Cornerstone revenue declined 4% in Q4 and 7% in full year 2018
  • Recognized $40 million of cost synergies in 2018

Corporate updates:

  • Amended QVC, Inc. credit facility, increasing capacity to $3.65 billion and extending maturity to 2023
  • From November 1st through January 31st, repurchased 15.1 million QRTEA shares at an average price per share of $21.30 and total cost of $321 million; total repurchases of $988 million in 2018

“In 2018, we made meaningful progress shaping the future of Qurate Retail, highlighted by the strongest new customer growth at QVC US in its 33-year history and continued gains in digital and mobile engagement,” said Mike George, President and CEO, Qurate Retail. “Results for the year were led by top-line growth at QVC US and International, excellent performance from zulily, and significantly improved second-half results at HSN as we execute on its turnaround. Margin improvement is a top priority in 2019, as we step up the realization of integration synergies and seek to execute on initiatives to improve product margin and optimize our marketing investments.”

Corporate Updates

On December 31, 2018, Qurate Retail completed an intercompany restructuring whereby HSN and its subsidiaries (excluding Cornerstone) became subsidiaries of QVC, Inc. The restructuring is intended to better facilitate cross-platform initiatives across the QVC and HSN businesses. Following the restructuring, QVC, Inc. is comprised of the businesses of QVC US, QVC International and HSN.

Qurate Retail includes QVC, Inc. (including HSN), zulily, llc and the Cornerstone Brands (collectively, “Qurate Retail Group”), which are wholly owned subsidiaries, as well as various green energy and other investments.

Discussion of Results

Unless otherwise noted, the following discussion compares financial information for the three months and year ended December 31, 2018 to the same periods in 2017. For purposes of presentation herein, the pro forma results of operations in this press release include historical HSN and Cornerstone results for comparison purposes. This is intended to supplement and enhance the information related to prior periods. The impacts of purchase accounting resulting from our acquisition of HSN and Cornerstone have not been reflected in these pro forma historical results.

Qurate Retail adopted the new U.S. accounting standard regarding revenue recognition (ASC 606) as of January 1, 2018. Accordingly, QVC, HSN and zulily recognize credit card income for their branded credit cards as part of net revenue rather than as an offset to selling, general and administrative (“SG&A”) expense. This change positively impacted Qurate Retail’s revenue for 2018. Qurate Retail is providing comparable results in addition to GAAP results where applicable and the narrative in this press release is presented excluding the impact of this accounting adjustment. The zulily-branded credit card was first implemented in the third quarter of 2017 and had a modestly positive impact on zulily’s reported revenue for the periods presented in this press release.

In addition, under the new revenue recognition standard, Qurate Retail now recognizes revenue at the time of shipment as opposed to customer delivery. This accounting change had an immaterial impact on reported results for Qurate Retail in the fourth quarter and full year. As such, comparable results presented in this press release for the fourth quarter are not adjusted for this change. HSN and Cornerstone previously recognized revenue at the time of shipment, so there is no impact to their reported results.

Qurate Retail realized $16 million in cost synergies in the fourth quarter related to the HSN acquisition that benefited operating income, of which approximately $14 million benefited adjusted OIBDA(2) and the remaining $2 million related to equity compensation expense. For the full year 2018, Qurate Retail realized $40 million in cost synergies that benefited operating income, of which approximately $32 million benefited adjusted OIBDA and $8 million was related to equity compensation expense. Qurate Retail expects to realize incremental expense synergies of approximately $120 - $130 million in 2019.

Qurate Retail incurred $15 million and $72 million of transaction-related and severance expense in the fourth quarter and full year 2018, respectively. In addition, the fourth quarter of 2018 included a $30 million pre-tax, non-cash impairment charge related to the fair value of the HSN trademark and a $3 million pre-tax, non-cash impairment charge at Cornerstone related to the shutdown of the Improvements catalog business. These transaction-related, severance and impairment charges are excluded from adjusted OIBDA.

 

FOURTH QUARTER 2018 FINANCIAL RESULTS

   
(amounts in millions)     4Q17     4Q18    

% Change

% Change
Constant
Currency(a)

Revenue
QVC US(b) $ 2,029 $ 2,087

3

%

QVC International(c) 788 766

(3

)%

(1

)%

HSN(b)(d) 712 707

(1

)%

zulily(b) 520 551

6

%

Cornerstone(d) 283 271

(4

)%

Intersegment eliminations   -     (6 ) NM  
Total Qurate Retail Revenue (pro forma) $ 4,332   $ 4,376  

1

%

Former Liberty Ventures corporate and other(e) 7 -
Pre-acquisition HSN and Cornerstone results   (995 )   -  
Total Qurate Retail Revenue (as reported) $ 3,344   $ 4,376  
 
Operating Income
QVC US $ 367 $ 346

(6

)%

QVC International(c) 129 103

(20

)%

(19

)%

HSN(d) (3 ) 12 NM
zulily (18 ) (2 )

89

%

Cornerstone(d) (11 ) (13 ) NM
Unallocated corporate cost(f)   (44 )   (11 )

75

%

Total Qurate Retail Operating Income (pro forma) $ 420   $ 435  

4

%

Former Liberty Ventures corporate and other(e) (23 ) -
Pre-acquisition HSN and Cornerstone results(g)   (29 )   -  
Total Qurate Retail Operating Income (as reported) $ 368   $ 435  
 
Adjusted OIBDA
QVC US $ 442 $ 412

(7

)%

QVC International(c) 147 129

(12

)%

(11

)%

HSN(d) 79 77

(3

)%

zulily 38 34

(11

)%

Cornerstone(d) 12 6

(50

)%

Unallocated corporate cost(f)   (3 )   (6 )

(100

)%

Total Qurate Retail Adjusted OIBDA (pro forma) $ 715   $ 652  

(9

)%

Former Liberty Ventures corporate and other(e) (6 ) -
Pre-acquisition HSN and Cornerstone results   (91 )   -  
Total Qurate Retail Adjusted OIBDA (as reported) $ 618   $ 652  

____________________

a)   For a definition of constant currency financial metrics, see the accompanying schedules.
b) As a result of Qurate Retail’s adoption of new accounting standards around revenue recognition (ASC 606), QVC-, HSN- and zulily-branded credit card income is recognized as part of net revenue. Fourth quarter 2018 revenue includes the following amounts of credit card income:

• QVC US: $24 million; revenue grew 2% in the fourth quarter of 2018 excluding the impact of this accounting change.

• HSN: $5 million; revenue declined 1% in the fourth quarter of 2018 excluding the impact of this accounting change.

• zulily: $3 million; revenue grew 5% in the fourth quarter of 2018 excluding the impact of this accounting change.

c) Includes QVC France, QVC Germany, QVC Italy, QVC Japan and QVC UK.
d) Pro forma results represent HSN and Cornerstone historical results, including the period prior to the acquisition of HSN and Cornerstone by Qurate Retail.
e) 2017 results include the results of the former Liberty Ventures Group consolidated in Qurate Retail’s results.
f) Includes corporate costs incurred at Qurate Retail, Inc. but not allocated to any business segment.
g) Qurate Retail Operating Income (as reported) in Q4-17 included $38 million and $5 million of severance, stock compensation and bonus cost at HSN and Cornerstone, respectively, that was consolidated in Qurate Retail’s reported results.
 
 

FULL YEAR 2018 FINANCIAL RESULTS

 
(amounts in millions)     2017       2018       % Change    

% Change
Constant

Currency(a)

Revenue
QVC US(b) $ 6,140 $ 6,349

3

%

QVC International(c) 2,631 2,738

4

%

1

%

HSN(b)(d) 2,343 2,202

(6

)%

zulily(b) 1,613 1,817

13

%

Cornerstone(d) 1,042 970

(7

)%

Intersegment eliminations   (3 )   (9 ) NM  
Total Qurate Retail Revenue (pro forma) $ 13,766   $ 14,067  

2

%

Former Liberty Ventures corporate and other(e) 23 3
Pre-acquisition HSN and Cornerstone results   (3,385 )   -  
Total Qurate Retail Revenue (as reported) $ 10,404   $ 14,070  
 
Operating Income
QVC US $ 994 $ 1,112

12

%

QVC International(c) 353 351

(1

)%

(4

)%

HSN(d) 103 49 NM
zulily (129 ) (95 )

26

%

Cornerstone(d) 8 (33 ) NM
Unallocated corporate cost(f)   (75 )   (52 )

31

%

Total Qurate Retail Operating Income (pro forma) $ 1,254   $ 1,332  

6

%

Former Liberty Ventures corporate and other(e) (57 ) (8 )
Pre-acquisition HSN and Cornerstone results(g)   (154 )   -  
Total Qurate Retail Operating Income (as reported) $ 1,043   $ 1,324  
 
Adjusted OIBDA
QVC US $ 1,455 $ 1,417

(3

)%

QVC International(c) 451 429

(5

)%

(8

)%

HSN(d) 220 213

(3

)%

zulily 91 108

19

%

Cornerstone(d) 46 21

(54

)%

Unallocated corporate cost(f)   (20 )   (29 )

(45

)%

Total Qurate Retail Adjusted OIBDA (pro forma) $ 2,243   $ 2,159  

(4

)%

Former Liberty Ventures corporate and other(e) (27 ) (5 )
Pre-acquisition HSN and Cornerstone results   (266 )   -  
Total Qurate Retail Adjusted OIBDA (as reported) $ 1,950   $ 2,154  

____________________

a)   For a definition of constant currency financial metrics, see the accompanying schedules.
b) As a result of Qurate Retail’s adoption of new accounting standards around revenue recognition (ASC 606), QVC-, HSN- and zulily-branded credit card income is recognized as part of net revenue. Full year 2018 revenue includes the following amounts of credit card income:
• QVC US: $102 million; revenue grew 2% in 2018 excluding the impact of this accounting change.
• HSN: $16 million; revenue declined 7% in 2018 excluding the impact of this accounting change.
• zulily $8 million; revenue grew 12% in 2018 excluding the impact of this accounting change.
c) Includes QVC France, QVC Germany, QVC Italy, QVC Japan and QVC UK.
d) Pro forma results represent HSN and Cornerstone historical results, including the period prior to the acquisition of HSN and Cornerstone by Qurate Retail.
e) Includes the results of the former Liberty Ventures Group consolidated in Qurate Retail’s results through March 9, 2018, prior to the split-off of GCI Liberty.
f) Includes corporate costs incurred at Qurate Retail, Inc. but not allocated to any business segment.
g) Qurate Retail Operating Income (as reported) in Q4-17 included $38 million and $5 million of severance, stock compensation and bonus cost at HSN and Cornerstone, respectively, that was consolidated in Qurate Retail’s reported results.
 
 

FOURTH QUARTER AND FULL YEAR 2018 NET INCOME AND ADJUSTED NET INCOME(2)

 
(amounts in millions)     4Q17     4Q18     2017     2018
Net Income(a) $ 887 $ 273 $ 1,208 $ 674
Adjusted Net Income(b) $ 266 $ 277 $ 807 $ 867
 
Basic weighted average shares outstanding ("WASO") 429 447 445 462
Potentially dilutive shares   3   2   3   3
Diluted WASO   432   449   448   465
 
GAAP EPS(a) $ 2.05 $ 0.61 $ 2.70 $ 1.45
Qurate Retail Adjusted EPS(b) $ 0.62 $ 0.62 $ 1.80 $ 1.86

____________________

a)   Represents net income and diluted net income per share from continuing operations attributable to Series A and Series B Qurate Retail common stockholders as presented in Qurate Retail’s financial statements.
b) See reconciling schedule 3.
 
 

QVC US

In the fourth quarter, QVC US realized sales gains primarily in electronics, apparel and accessories, which were partially offset by declines mainly in home. For the full year, QVC US realized gains primarily in accessories and apparel, which were partially offset by declines principally in jewelry. In the quarter, operating income and adjusted OIBDA margin(2) contraction, excluding the impacts of ASC 606, was primarily due to higher order fulfillment costs, lower product margins and higher bad debt and marketing expenses, which were partially offset by lower distribution commissions. For the full year, operating income margin expansion, excluding the impact of ASC 606, primarily reflects lower amortization as a result of the roll-off of purchase accounting amortization from Qurate Retail’s acquisition of QVC, partially offset by $32 million in transaction-related costs in 2018. Adjusted OIBDA margin contraction in 2018, excluding the impacts of ASC 606, was primarily due to higher order fulfillment, bad debt and marketing expenses.

As a result of Qurate Retail’s adoption of ASC 606, QVC US revenue for the three months and year ended December 31, 2018 includes an additional $24 and $102 million of revenue, respectively, from its private label credit card program which was previously classified as an offset to SG&A expenses. Excluding the impact of this accounting adjustment, QVC US revenue grew 2% in both the fourth quarter and full year. In the fourth quarter, this accounting change increased reported SG&A and had an approximate 80 bps positive impact on reported gross margins and an approximate 20 bps negative impact on reported operating income and adjusted OIBDA margins. For the full year, this accounting change increased reported SG&A and had an approximate 100 bps positive impact on reported gross margins, an approximate 30 bps negative impact on reported operating income margins and an approximate 40 bps negative impact on reported adjusted OIBDA margins. Separately, these results are not adjusted to reflect the impact of ASC 606 as it relates to recognizing revenue at the time of shipment rather than delivery, which had an immaterial impact on reported revenue and adjusted OIBDA in the fourth quarter and full year.

QVC International

In the fourth quarter, QVC International experienced year-over-year constant currency(3) sales declines primarily in accessories and apparel, which were partially offset by gains mainly in beauty. For the full year, QVC International realized gains primarily in beauty and home, partially offset by declines principally in apparel. In the fourth quarter and full year 2018, operating income and adjusted OIBDA margin contraction was primarily due to lower product margins, higher fixed costs and an inventory obsolescence provision. Operating income was also impacted by lower purchase accounting amortization, partially offset by $9 million in severance cost.

For the quarter, US Dollar denominated results were negatively impacted by exchange rate fluctuations, primarily due to the Dollar strengthening 3% versus the Euro and British Pound. For the year, US Dollar denominated results were positively impacted by exchange rate fluctuations. The Dollar weakened 4%, 3% and 2% versus the Euro, British Pound and Japanese Yen, respectively. The financial metrics presented in this press release also provide a comparison of the year-over-year percentage change in QVC International’s results in constant currency (where applicable) to the comparable figures calculated in accordance with US GAAP for the fourth quarter and full year 2018.

HSN

Although HSN’s results are only included in Qurate Retail’s results beginning January 1, 2018, we believe a discussion of HSN’s stand-alone results compared to the prior year period promotes a better understanding of the overall results of the business. HSN has reclassified certain costs to conform to Qurate Retail’s reporting for ease of comparability for the periods presented.

In the fourth quarter, HSN realized sales declines in electronics and jewelry, which were partially offset by gains primarily in accessories, beauty and apparel. For the full year, HSN realized declines in all categories. For the fourth quarter, operating margin expansion, excluding the impact of ASC 606, reflects lower transaction costs, which were partially offset by the aforementioned impairment charge and higher purchase accounting amortization. Adjusted OIBDA margin contraction, excluding the impact of ASC 606, was primarily due to higher inventory obsolescence and warehouse costs, which were partially offset by the reclassification of costs associated with certain TV distribution rights to amortization expense and lower customer service costs. For the full year, operating margin contraction, excluding ASC 606, primarily reflects higher amortization expense and the impairment charge, which was partially offset by lower transaction costs. Adjusted OIBDA margin expansion, excluding the impact of ASC 606, was due mainly to higher product and shipping margins and lower bad debt, fixed and customer service costs, which were partially offset by higher inventory obsolescence and warehouse expenses.

As a result of Qurate Retail’s adoption of ASC 606, HSN revenue for the three months and year ended December 31, 2018 includes an additional $5 and $16 million of revenue, respectively, from its private label credit card program which was previously classified as an offset to SG&A expense. Excluding the impact of this accounting adjustment, HSN revenue declined 1% in the fourth quarter and declined 7% for the full year. The impact of this change on reported adjusted OIBDA margins was insignificant for both the quarter and full year.

As previously discussed in the third quarter of 2018, HSN is operating under several renewed carriage agreements with certain distribution partners beginning in the third quarter of 2018 which provide for capitalized upfront payments that are amortized over the life of the agreements, versus HSN’s previous convention of expensing the payment associated with the contract terms each quarter. This change has a positive impact on HSN’s adjusted OIBDA with a corresponding increase in HSN’s amortization expense, but is cash neutral over the life of the agreements.

zulily

Revenue increased in the fourth quarter and full year due to strong customer acquisition. For the quarter, operating loss improved due to lower purchase accounting amortization. Adjusted OIBDA declined mainly due to higher freight, fixed and marketing expenses, which were partially offset by higher product margins and private label credit card income. For the full year, operating loss and adjusted OIBDA improved due to sales growth including the ramp up of zulily’s private label credit card income, as well as higher product margins and leverage of fixed and operating expenses. These gains were partially offset by higher freight and marketing costs. The impact of ASC 606 as it relates to recognizing revenue at the time of shipment rather than delivery had a negative impact on reported revenue and adjusted OIBDA in the fourth quarter, but did not materially impact full year reported revenue and adjusted OIBDA.

Cornerstone

Revenue declined in the fourth quarter and full year primarily driven by the shutdown of the Improvements catalog business effective December 2018 and weakness at Frontgate and Grandin Road, partially offset by growth at Garnet Hill and Ballard Designs. In the fourth quarter, operating income and adjusted OIBDA declines were principally driven by lower sales and higher employee-related costs, which were partially offset by lower marketing expenses. Full year operating income and adjusted OIBDA declines were primarily driven by lower sales, an inventory obsolescence provision for the closure of the Improvements’ facility and higher fixed costs, which were partially offset by lower marketing expenses. Operating income in the fourth quarter and full year 2018 included $5 million and $8 million, respectively, of severance and restructuring costs (including costs related to the closing of Improvements), as well as higher purchase accounting amortization and the aforementioned impairment charge.

FOURTH QUARTER 2018 SUPPLEMENTAL METRICS

 
(amounts in millions unless otherwise noted)     4Q17     4Q18     % Change    

% Change
Constant
Currency(a)

QVC – Total
Operating Income Margin (%) 17.6 % 15.7 % (190 ) bps
Adjusted OIBDA Margin (%) 20.9 % 19.0 % (190 ) bps
eCommerce Revenue(b) $ 1,498 $ 1,599 7 % 7 %
eCommerce % of Total Revenue 53.2 % 56.0 % 280 bps
Mobile % of eCommerce Revenue(c) 64.9 % 67.7 % 280 bps
 
QVC – US
Cost of Sales % of Revenue 66.4 % 66.7 % 30 bps
Operating Income Margin (%) 18.1 % 16.6 % (150 ) bps
Adjusted OIBDA Margin (%) 21.8 % 19.7 % (210 ) bps
Average Selling Price $ 55.60 $ 55.32 (1 ) %
Units Sold 2 %
Return Rate(d) 15.5 % 15.4 % (10 ) bps
eCommerce Revenue(b) $ 1,198 $ 1,283 7 %
eCommerce % of Total Revenue 59.0 % 61.5 % 250 bps
Mobile % of eCommerce Revenue(c) 63.5 % 66.3 % 280 bps
 
QVC – International
Cost of Sales % of Revenue 62.8 % 63.8 % 100 bps
Operating Income Margin (%) 16.4 % 13.4 % (300 ) bps
Adjusted OIBDA Margin (%) 18.7 % 16.8 % (190 ) bps
Average Selling Price (3 ) % (1) %
Units Sold 0 %
eCommerce Revenue(b) $ 300 $ 316 5 % 8 %
eCommerce % of Total Revenue 38.1 % 41.3 % 320 bps
Mobile % of eCommerce Revenue(c) 69.7 % 72.7 % 300 bps
 
HSN(e)(g)
Cost of Sales % of Revenue 67.6 % 69.0 % 140 bps
Operating Income Margin (%) (0.4 ) % 1.7 % NM
Adjusted OIBDA Margin (%) 11.1 % 10.9 % (20 ) bps
Average Selling Price $ 56.80 $ 57.71 2 %
Units Sold (5 ) %
Return Rate(d) 14.2 % 13.5 % (70 ) bps
eCommerce Revenue(b) $ 343 $ 362 6 %
eCommerce % of Total Revenue 48.2 % 51.2 % 300 bps
Mobile % of eCommerce Revenue(c) 57.7 % 62.6 % 490 bps
 
zulily
Cost of Sales % of Revenue 75.9 % 75.9 % 0 bps
Operating Income Margin (%) (3.5 ) % (0.4 ) % 310 bps
Adjusted OIBDA Margin (%) 7.3 % 6.2 % (110 ) bps
Mobile % of Total Orders 68.1 % 72.9 % 480 bps
 
Cornerstone(e)
Operating Income Margin (%) (3.9 ) % (4.8 ) % NM
Adjusted OIBDA Margin (%) 4.2 % 2.2 % (200 ) bps
eCommerce Revenue(b) $ 205 $ 202 (1 ) %
eCommerce % of Total Revenue 72.4 % 74.5 % 210 bps
 
China JV(f)
Revenue $ 50 $ 47 (6 ) %
Adjusted OIBDA $ 4 $ 2 (50 ) %
 
 

____________________

a)   For a definition of constant currency financial metrics, see the accompanying schedules.
b) Based on net revenue.
c) Based on gross US Dollar orders.
d) Measured as returned sales over gross shipped sales.
e) Prior year historical results are included for comparative purposes.
f) This joint venture is accounted for as an equity investment.
g) Certain prior year operating metrics of HSN have been restated to conform to QVC methodology and may differ from those reported in Qurate Retail’s Q4-17 earnings press release.
 
 
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FULL YEAR 2018 SUPPLEMENTAL METRICS

 
(amounts in millions unless otherwise noted)     2017     2018     % Change    

% Change
Constant
Currency(a)

QVC – Total
Operating Income Margin (%) 15.4 % 16.1 % 70 bps
Adjusted OIBDA Margin (%) 21.7 % 20.3 % (140 ) bps
eCommerce Revenue(b) $ 4,364 $ 4,722 8 % 8 %
eCommerce % of Total Revenue 49.8 % 52.0 % 220 bps
Mobile % of eCommerce Revenue(c) 63.8 % 67.0 % 320 bps
LTM Total Customers(d) 12.7 13.0 2 %
 
QVC – US
Cost of Sales % of Revenue 64.6 % 63.9 % (70 ) bps
Operating Income Margin (%) 16.2 % 17.5 % 130 bps
Adjusted OIBDA Margin (%) 23.7 % 22.3 % (140 ) bps
Average Selling Price $ 55.37 $ 54.42 (2 ) %
Units Sold 4 %
Return Rate(e) 17.0 % 17.3 % 30 bps
eCommerce Revenue(b) $ 3,421 $ 3,672 7 %
eCommerce % of Total Revenue 55.7 % 57.8 % 210 bps
Mobile % of eCommerce Revenue(c) 62.4 % 65.5 % 310 bps
LTM Total Customers(d) 8.1 8.3 2 %
 
QVC – International
Cost of Sales % of Revenue 62.1 % 62.9 % 80 bps
Operating Income Margin (%) 13.4 % 12.8 % (60 ) bps
Adjusted OIBDA Margin (%) 17.1 % 15.7 % (140 ) bps
Average Selling Price 3 % 0 %
Units Sold 1 %
eCommerce Revenue(b) $ 943 $ 1,050 11 % 8 %
eCommerce % of Total Revenue 35.8 % 38.3 % 250 bps
Mobile % of eCommerce Revenue(c) 68.2 % 71.5 % 330 bps
LTM Total Customers(d) 4.6 4.7 2 %
 
HSN(f)(h)
Cost of Sales % of Revenue 66.6 % 66.6 % 0 bps
Operating Income Margin (%) 4.4 % 2.2 % NM
Adjusted OIBDA Margin (%) 9.4 % 9.7 % 30 bps
Average Selling Price $ 54.68 $ 55.04 1 %
Units Sold (9 ) %
Return Rate(e) 15.1 % 14.2 % (90 ) bps
eCommerce Revenue(b) $ 1,099 $ 1,074 (2 ) %
eCommerce % of Total Revenue 46.9 % 48.8 % 190 bps
Mobile % of eCommerce Revenue(c) 56.0 % 60.3 % 430 bps
LTM Total Customers(d) 4.7 4.5 (4 ) %
 
zulily
Cost of Sales % of Revenue 74.1 % 74.1 % 0 bps
Operating Income Margin (%) (8.0 ) % (5.2 ) % 280 bps
Adjusted OIBDA Margin (%) 5.6 % 5.9 % 30 bps
Mobile % of Total Orders 67.3 % 71.5 % 420 bps
LTM Total Customers(d)