Blue Apron’s shares took a big hit when Amazon purchased Whole Foods back in June, and the cooking kit business is having a hard time bouncing back. Investors were wary back then, and it seems they haven’t gotten over it just yet: Blue Apron’s shares were down an additional 9 percent by mid-day Thursday, making the total landslide since June an overwhelming 58 percent on the stock market.
It isn’t all bad news though. Blue Apron managed to increase its revenue by 3 percent this quarter, taking in a respectable $210.6 million, a much better figure than the $210.6 million analysts were predicting. Unfortunately, its losses clocked in at 47 cents per share as opposed to the 42 cents per share Wall Street was expecting. But shares isn’t the only factor affecting Blue Apron’s success. The company increased the cost of its kits by 13 percent from last year, explaining that it did so “primarily as a result of increased costs associated with the launch of new operational infrastructure to support the company’s product expansion initiatives, including its new Linden, New Jersey facility.” Perhaps because of the price increase, Blue Apron is also struggling to retain customers and reach new ones, which also doesn’t help its cause in the long term.
Blue Apron’s CEO, Matt Salzberg, isn’t throwing in the towel just yet. He said in a statement that “We’re pleased to share that all Blue Apron customers now have access to our expanded product offering and that the transition of volume to our new Linden, New Jersey fulfillment center is complete,” and added “we are now focused on optimizing our operations so that we can drive progress on our product roadmap in order to further our mission to make incredible home cooking accessible to everyone.”
I like Blue Apron, but I for one will remain very, very cautiously optimistic about its chances at long-term success. After all, investors are right to be unnerved by the new Amazon/Whole Foods situation, and there are many other cooking kit businesses out there that can compete right alongside Blue Apron for customers and investors. Let’s hope that it can get back on its feet, but keep our options open just the same.