Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Why The Redbubble (ASX:RBL) Share Price Has Been Punctured

The Redbubble Ltd (ASX: RBL) share price is down over 14% after giving its March 2019 quarter update.

Redbubble was founded in 2006, it owns and operates Redbubble.com and TeePublc.com, two global online market places where over 800,000 independent artists can sell their designs on products like apparel, stationery, bags, wall art and so on. It allows customers to shop through a wide range of options rather than just going to one art gallery at a time.

Here’s Why The Redbubble Share Price Has Been Pierced

Redbubble reported that in the third quarter of FY19 the company grew its marketplace revenue (being the product and shipping revenue less payments to artists) by 40.3% year on year thanks to the addition of TeePublic. On a constant currency basis the growth was 32.6%.

However, the business saw lower growth in the March 2019 quarter compared to the December 2018 quarter because of the continuing organic search issue.

Gross profit for the year to March 2019 was $71.7 million, which was 47.7% higher. Cash operating expenses only grew by 30.6% to $47.2 million. This increasing operating leverage allowed the company to reveal an operating EBITDA profit of $3.2 million (click here to learn what EBITDA means) – this was an improvement of $3.7 million compared to last year’s $0.5 million loss.

Looking at the performance of the Redbubble platform, product revenue from ‘authentic’ sellers grew by 36% in the third quarter and now represent 80% of Redbubble’s product revenue.

In the year to date, unique customers have increased by 21.1% year on year to 4.4 million and selling artists have increased by 41% to 334,000.

Management said that the TeePublic acquisition is proceeding well and is adding to the group performance.

To try to fix the organic search issues Redbubble management are trying to improve the speed of pages that attract high traffic and also the company is aiming to consolidate the content that Redbubble allows Google to index.

However, the company did say that it experienced its “normal seasonal” cash outflows in the third quarter of the financial year after the strong inflows during the second quarter. Total outflows were $29.6 million and it ended with cash of $29.1 million.

With the share price falling so much over the past six months, I think Redbubble could be one to watch because of its operating model. There is a lot of power in network effects. The fact that Redbubble is getting closer to a cash profit is a positive sign. I think Redbubble and the 2 rapid ASX growth shares in the free report below are worth watching over the next couple of years.

[ls_content_block id=”14947″ para=”paragraphs”]

[ls_content_block id=”18380″ para=”paragraphs”]

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Skip to content