Annie Mitchell: Sure. Achieving adjusted EBITDA profitability does remain our north star. And we anticipate that it may take longer than initially communicated. We believe the transformation work that we’ve done to date and will continue to do in 2024, is positioning the business to achieve top line growth in 2025. But this year, the deliberate strategic actions that we’re taking around international and US store closures. We’ll only see a partial year impact from these due to timing happening over the course of the year. And in 2025, we will benefit from a full year of profitability improvement, setting us up to drive long-term profitable growth supported by the new product and marketing coming online later this year and as we ramp up into 2025.
Tom Nikic: All right. Understood and I guess as we think out to 2025, I mean, I guess there should still be some amount of headwind from or a top line headwind from store closures and the international distributor transitions, right, as they kind of, you know, wrap around.
Annie Mitchell: That is correct. When we do the quarterly comp year-over-year, we will continue to have non-comp impacts as we go into 2025. But remember, these strategic actions are being made because they will be impactful and positive on the bottom line. And so that’s what we’re focusing on as we go into 2025 is improving adjusted EBITDA.
Tom Nikic: Understood. Thank you very much and best of luck this year.
Annie Mitchell: Thank you.
Operator: Thank you. One moment for our next question. Our next question comes from the line of Dana Telsey with Telsey Advisory Group. Your line is now open.
Dana Telsey: Hi. Good afternoon, everyone. As you think about your store base in the closing of 10 to 15, what is the right number of stores that you should have and by eliminating these stores, what’s the revenue impact and what’s the cost impact that you see as a result? Thank you.
Annie Mitchell: Thanks, Dana. The overall impact to the top line this year is 7 million to 9 million. That is largely based on about a half — average of a half year convention with the door closures. So we do expect the top line to have some non-comp impact as we go in to 2025. In terms of the cost savings, we believe that this change this year, again, largely a partial impact, will be a range of positive 3 million to 5 million from closing these retail doors. And again, that’s approximately on a half-year convention. Again, some are closed, some have already closed, and then some will continue to close over the course of Q2 and into a few into Q3. Does that help, Dana?
Dana Telsey: Yes. And what’s the go-forward number of stores that you should have from the existing base after that? What are you looking to retain in terms of stores?
Joseph Zwillinger: Dana, I think it’s hard to put a number on that because as the base of customers who are aware of us and are purchasing our product expands. I think there’s really big white space for the number of stores that could potentially exist. So we need to revitalize momentum and get some relevance with those new consumers we meet and then we can start thinking about building stores again. I think the most important aspect there is just maintaining balance, and we should, and we expect to have a lot of weapons at our disposal, including a much more robust wholesale offering. We have introduced products on Amazon, which has been really successful for us, alongside our DTC channel. So as we see the marketplace develop, it’s going to be mostly about balance going forward, and the right number of stores should reveal itself as the business scales and we regain momentum and that’ll be a geographic specific decision and one we want to maintain and drive great omni-channel purchase but do it in a very balanced way.
Dana Telsey: Thank you.
Operator: Thank you. This concludes the Q&A portion. I’ll now turn the call back over to Joe Vernachio for closing remarks.
Joe Vernachio: Thank you, everyone, for joining us today. I’m incredibly energized by the opportunity ahead of us at Allbirds and I’m really personally excited to get to meet and spend time with our analysts and investors in the coming months. Thank you very much.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect. Everyone have a wonderful day.
