Overstock to Retain Retail Arm, Support Blockchain and Crypto Ventures
The CEO of retail giant Overstock.com, Patrick Byrne, noted the potential profitability of the firm’s retail arm in its Q4 2018 earnings conference call on March 18.
Byrne’s statements indicate that Overstock may not be divesting from its retail wing as soon as was previously indicated. Last year, Byrne reportedly told The Wall Street Journal that Overstock would sell off its retail wing sometime in early 2019.
During the section of the conference call devoted to retail, Byrne said that “this is going to be a year of explosive growth,” and that the retail wing would “spit out cash.”
The CEO predicted that the firm was going to “do $115 million dollars better than last year.” Of that $115 million dollar amount, Byrne says that $33 million will come from improvements in expense management and retail tech, while $82 million will come from planned improvements in retail contribution.
When asked why the process of the retail sale was taking so long, Byrne said that there there is no fixed timeline:
“Selling a company is like a souffle. You can’t yell at the souffle, you can’t ask the souffle when it’s ready. The souffle is ready when it’s ready.”
Overstock execs including Byrne noted that the firm has turned from a purely retail enterprise into a blockchain portfolio company through its subsidiaries Medici Ventures and tZERO.
The firm outlined a strategy of creating “Government-as-a-Service” through the deployment of blockchain technology in voting, land registry, capital markets, commerce, identity and money. Within each category, the firm noted recent projects it has supported and developed as part of its goals.
The income provided by its retail wing could be useful for supporting its foray into blockchain technology and crypto currencies. In a recent report to the United States Securities and Exchange Commission, the firm stated:
“We have incurred significant losses recently, and we have utilized a significant amount of cash in funding of our Medici and tZERO initiatives. We also have plans for Medici and tZERO that will require significant additional funding, and we do not currently expect to make any distribution to stockholders even if we sell the retail business.”
However, Byrne remained unfazed by the losses in the March 18 conference call, saying, “Our blockchain projects are some of the most significant and cutting edge in the world, and we are just reaching the point where our products are being introduced to the public. In particular, tZERO brought live a security token trading platform.”