Bed Bath & Beyond Inc has reported its first revenue growth in 19 quarters, sending its share price up by 30 per cent after trading hours.

The owner of Bed Bath & Beyond, Overstock, BuyBuy Baby and Kirkland’s lifted its net revenue by 6.9 per cent to $248 million during the quarter ended March 31. Excluding the impact from the company’s exit from Canada, sales rose by an even higher 9.4 per cent.

This marks the first time in 19 quarters that the business has returned to year-on-year growth. Over the period, the company also operated with its lowest cost structure in over 12 years. 

“This is not growth driven by incremental spending,” commented Marcus Lemonis, executive chairman and CEO. “It is growth building on top of a fundamentally reset operating model.”

Following the optimistic financial results, Bed Bath & Beyond’s shares surged 28 per cent to $6.83 in after-hours trading on Monday.

‘A model designed to scale’

According to the CEO, customer acquisition has become more efficient, owned channels are performing better, and engagement quality is improving. Returning customer behavior is also strengthening, and average order value is increasing. 

During the quarter, the company completed the acquisition of Kirkland’s and announced the pending acquisitions of The Container Store and F9 Brands, as well as additional capabilities. 

In addition, the business also simplified assortments, improved SKU productivity, strengthened vendor partnerships, and evolved its store fleet. It also consolidated various functions into a single operating platform, reducing structural cost and improving speed.

“This is not simply about reducing cost. It is about building an operating model that is designed to scale,” said Lemonis.

“What you are seeing this quarter is the early proof of that model coming together.”

Narrowing loss

A better top line has translated into a strengthening bottom line. 

During the quarter, adjusted EBITDA improved by approximately $5 million. Net loss improved by approximately $24 million. 

This marks the sixth consecutive quarter of adjusted EBITDA year-over-year improvement. 

“Over the next nine months, as we continue to integrate these capabilities, we expect to remove more than $60 million of cost from the consolidated company while strengthening our ability to grow more efficiently,” Lemonis added.

In a separate announcement, the company said it has recruited Kyla Robinson as chief technology transformation officer. 

Kyla brings more than 15 years of experience leading digital commerce, product, and technology organizations, with her most recent role at Spanx. She will be responsible for building a unified technology and data platform that connects omnichannel retail experience, home services, product ecosystem, and financial capabilities.