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What changed in Bark, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Bark, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+268 added−265 removedSource: 10-K (2025-06-04) vs 10-K (2024-06-03)

Top changes in Bark, Inc.'s 2025 10-K

268 paragraphs added · 265 removed · 208 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeOur DTC business drives the majority of our revenues and represented 89.0% of total revenue in fiscal 2024. Our commerce business, which reflects the sale of BARK products in retail stores and other e-tailers, significantly broadens our customer reach and raises awareness for the BARK brand.
Biggest changeOur commerce business, which reflects the sale of BARK products in retail stores and other e-tailers, significantly broadens our customer reach and raises awareness for the BARK brand. Today, BARK products are sold in over 50,000 retail doors, including Target, Walmart, Kroger, Petco, and PetSmart. Additionally, we sell our products on other online platforms including Amazon and Chewy.
Supplements —Includes a variety of dog supplements such as hip and joint support, and skin and coat support. These products are often targeted at specific breeds that are prone to certain ailments. Kibble —We sell a variety of kibble, priced to compete with the mass premium category.
Supplements —Includes a variety of dog supplements such as hip and joint support, and skin and coat support. These products are often targeted at specific breeds that are prone to certain ailments. Kibble —We sell a variety of kibble, priced to compete with the premium category.
On a regular basis, we review all grants of equity for parity across gender and race to ensure that we are taking a consistent approach to compensation for all team members based on market data, role, and level. Manufacturing 7 Table of Contents BARK purchases substantially all of its merchandise directly from third-party manufacturers.
On a regular basis, we review all grants of equity for parity across gender and race to ensure that we are taking a consistent approach to compensation for all team members based on market data, role, and level. Manufacturing BARK purchases substantially all of its merchandise directly from third-party manufacturers.
Further, we could be subject to fines or other payments for any past failures to comply with these requirements. The continued growth of and demand for e-commerce is likely to result in more laws and regulations that impose additional compliance burdens on e-commerce companies.
Further, we could be subject to fines or other payments for any past failures to comply with these requirements. The 9 Table of Contents continued growth of and demand for e-commerce is likely to result in more laws and regulations that impose additional compliance burdens on e-commerce companies.
Our Key Products: Toys & Accessories (“toys”)— The majority of our revenue in the toys category is derived from BarkBox and Super Chewer, which are subscription products that feature monthly themed boxes of premium-quality BARK toys 4 Table of Contents and treats that are delivered directly to a dog’s home.
Our Key Products: Toys & Accessories (“toys”)— The majority of our revenue in the toys category is derived from BarkBox and Super Chewer, which are subscription products that feature monthly themed boxes of premium-quality BARK toys and treats that are delivered directly to a dog’s home.
With the introduction of innovative new products across kibble, toppers, supplements, and dental products, we have significantly increased our addressable market and the number of customers we can serve. In the near-term, one of our biggest opportunities is to grow our consumables presence in retail.
With the introduction of innovative new products across kibble, toppers, 6 Table of Contents supplements, and dental products, we have significantly increased our addressable market and the number of customers we can serve. In the near-term, one of our biggest opportunities is to grow our consumables presence in retail.
Treats — Includes treats and chews included in our BarkBox and Super Chewer boxes, as well as the sale of treats on our consumables website. Many of our treats feature monthly themes, similar to our toys. Today, BARK is one of the largest treat brands in the U.S. by revenue.
Treats — Includes treats and chews included in our BarkBox and Super Chewer boxes, as well as the sale of treats on our Bark.co. Many of our treats feature monthly themes, similar to our toys. Today, BARK is one of the largest treat brands in the U.S. by revenue.
BARK Air —Announced in April 2024, BARK Air is a first-of-its kind air travel experience tailored to dogs. The Company partnered with a jet charter company to begin offering premium flights for customers and their dogs. Interested parties can book flights at dogsflyfirst.com.
BARK Air —Announced in April 2024, BARK Air is a first-of-its kind air travel experience tailored to dogs. The Company is partnered with several charter companies offering premium flights for customers and their dogs. Interested parties can book flights at dogsflyfirst.com.
Our Strengths 5 Table of Contents Ever-Growing Data Drives Personalization at Scale: We know the names, age, breed, birthdays, play style, allergies, and more for over 6 million dogs. We believe that this is a key competitive advantage as it enables us to deliver highly personalized products and experiences for each and every dog that we serve.
Our Competitive Strengths Ever-Growing Data Drives Personalization at Scale: We know the names, age, breed, birthdays, play style, allergies, and more for millions of dogs. We believe that this is a key competitive advantage as it enables us to deliver highly personalized products and experiences for each and every dog that we serve.
To that end, our company culture is centered around service, creativity, and a high level of ambition to serve all dogs and their humans. At the end of fiscal 2024, BARK employed approximately 708 full-time and part-time employees, with 377 employees based in the U.S. and 331 employees based in the Philippines.
To that end, our company culture is centered around service, creativity, and a high level of ambition to serve all dogs and their humans. At the end of fiscal 2025, BARK employed approximately 691 full-time and part-time employees, with 300 employees based in the U.S. and 377 employees based in the Philippines.
Our charter partner is responsible for all aircraft, crew, maintenance, and insurance, allowing BARK to focus on creating a great travel experience for dogs and their people worldwide. We believe this initiative exemplifies the Company’s dog-first approach to curating the best products and services.
Our charter partners are responsible for all aircraft, pilots, maintenance, and insurance, allowing BARK to focus on creating a great travel experience for dogs and their people worldwide. We believe this initiative exemplifies the Company’s dog-first approach to curating the best products and services.
Competition The dog products industry is highly competitive, fragmented, and spread across four primary segments: • supermarkets, warehouse clubs, and mass merchants; • specialty pet store chains; • traditional or neighborhood pet stores; and 8 Table of Contents • subscription service businesses and e-tailers.
Competition The dog products industry is highly competitive, fragmented, and spread across four primary segments: • supermarkets, warehouse clubs, and mass merchants; • specialty pet store chains; • traditional or neighborhood pet stores; and • subscription service businesses and e-retailers.
By designing our own products, we have the opportunity to achieve higher price points, therefore expanding our gross margins. Omnichannel: While the majority of our revenues are driven by our DTC business, we derived $54 million, or 11.0% of our revenue from the sale of BARK products in retail stores and other e-tailers in fiscal 2024.
By designing our own products, we have the opportunity to achieve higher price points, therefore expanding our gross margins. Omnichannel: While the majority of our revenues are driven by our DTC business, we derived $68 million, or 14.1% of our revenue from the sale of BARK products in retail stores and other e-tailers in fiscal 2025.
Dogs are the most popular pet in the U.S.: According to the 2022-23 APPA Survey, dogs are the most popular pet in the U.S., with more than 65 million households having a dog as a member of their family. We believe we have an opportunity to significantly expand our customer base, both in the U.S. and globally.
Dogs are the most popular pet in the U.S.: According to the APPA, dogs are the most popular pet in the U.S., with approximately 68 million households having a dog as a member of their family. We believe we have an opportunity to significantly expand our customer base, both in the U.S. and globally.
We leverage an ever-growing 3 Table of Contents collection of first-party data, customer insights, and machine learning to deliver personalized products and experiences tailored to the needs of each and every dog we serve. Our products are sold Direct-to-Consumer (“DTC”) and through our network of retail partners, which currently spans over 40,000 doors nationwide.
We leverage an ever-growing collection of first-party data, customer insights, and machine learning to deliver personalized products and experiences tailored to the needs of each and every dog we serve. Our products are sold Direct-to-Consumer (“DTC”) and through our network of retail partners, which currently spans over 50,000 doors nationwide and online marketplaces including Amazon and Chewy.
Our Industry Large, growing, and resilient market for pet products: According to the American Pet Products Association (“APPA”), annual spend on pets in the U.S. was approximately $147 billion in 2023, an increase of over $10 billion, or approximately 7%, compared to 2022.
Our Industry Large, growing, and resilient market for pet products: According to the American Pet Products Association (“APPA”), annual spend on pets in the U.S. was approximately $152 billion in 2024, an increase of $3 billion, or approximately 3%, compared to 2023.
We currently sell our treats across 2,400 Target and PetSmart doors, and aim to expand our consumables presence across our retail footprint. We are also seeing healthy growth in our newer consumables categories across our DTC segment. While these product lines are relatively small for BARK today, we see significant a opportunity to grow these products, long-term.
We currently sell our treats across 2,400 Target and PetSmart doors, and aim to expand our consumables presence across our retail footprint. While these product lines are relatively small for BARK today, we see significant opportunity to grow these products, long-term.
The Company also began selling its treats in over 2,400 doors nationwide this year. Toppers —Includes meal-enhancing sprinkles, broths, and bites that are added to a dog’s food to enhance the flavor of their food. These toppers are often single ingredient proteins that can be easily added to a dog’s existing meal plan. Toppers are particularly beneficial for picky eaters.
Toppers —Includes meal-enhancing sprinkles, broths, and bites that are added to a dog’s meal to enhance the flavor of their food. These toppers are often single ingredient proteins that can be easily added to a dog’s existing meal plan. Toppers are particularly beneficial for picky eaters.
Since our founding in 2011, we have happily served millions of dogs and their people. We are a vertically integrated, omnichannel brand serving dogs across two key categories: toys & accessories and consumables. All of our products are designed, developed, and branded BARK.
Since our founding in 2011, we have happily served millions of dogs and their people. We are an omnichannel brand that designs and develops proprietary products for dogs across two key categories: toys & accessories and consumables. All of our products are designed and developed in-house, and 3 Table of Contents BARK branded.
Growth Opportunities We strive to be a dog parent’s partner from those first days with a puppy throughout their dog’s entire adult life. BARK seeks to be there every step of the way serving dogs with the best products and services. Our ambition is to grow BARK to be the world’s favorite dog brand.
We believe this platform will be an important enabler of future growth in our DTC segment. Growth Opportunities We strive to be a dog parent’s partner from those first days with a puppy throughout their dog’s entire adult life. BARK seeks to be there every step of the way serving dogs with the best products and services.
We are focused on several key areas that we believe will be significant drivers to our business, long-term. Growth across our consumables products: While we are one of the largest treat companies in the U.S. by revenue today, we have only just begun to tap into the broader consumables opportunity.
Growth across our consumables products: While we are one of the largest treat companies in the U.S. by revenue today, we have only just begun to tap into the broader consumables opportunity.
Though most of the team has worked remotely since March 2020, we currently use our offices in New York, New York and Columbus, Ohio for regular team collaboration, all hands meetings, workshops and more.
We leverage these data points to continuously evolve our policies and practices to meet employee needs and align with BARK team values. Though most of the team has worked remotely since March 2020, we currently use our offices in New York, New York and Columbus, Ohio for regular team collaboration, all hands meetings, workshops and more.
Our toys & accessories category also includes revenue derived from the sale of other products such as beds, leashes, apparel, and other accessories. This category generated approximately $284.7 million of revenue in fiscal 2024, down 7% compared to fiscal 2023.
This distribution channel allows us to reach new customers and introduce them to the BARK brand. Our toys & accessories category also includes revenue derived from the sale of other products such as beds, leashes, apparel, and other accessories. This category generated approximately $262.3 million of revenue in fiscal 2025, down 8% compared to fiscal 2024.
Unified Customer Experience Expected to Enhance Cross-Selling and Awareness: 6 Table of Contents Historically, BARK operated five siloed businesses and customer experiences – BarkBox, SuperChewer, BarkBright, BarkFood, and BarkShop. Each of these businesses had distinct websites, dashboards, and logins.
Unified Customer Experience Expected to Enhance Cross-Selling and Awareness: Historically, BARK operated five siloed businesses and customer experiences – BarkBox, SuperChewer, Bark Bright, BarkFood, and BarkShop. Each of these businesses had distinct websites, dashboards, and logins. We recently unified our brand under the Bark.co domain, which is run on Shopify.
More recently, we have entered exciting, and much larger categories in the consumables space, which include kibble, treats, toppers, supplements, and dental products. This expansion has significantly increased our total addressable market and the number of customers we can serve.
In addition to being one of the largest dog toy brands in the U.S. by revenue, we also play in exciting, and much larger categories in the consumables space, which include kibble, treats, toppers, supplements, and dental products. These categories have significantly increased our total addressable market and the number of customers we can serve.
The Company currently sells products in over 40,000 retail doors nationwide, including Target, Walmart, Kroger, Petco, and PetSmart. We believe that these partnerships significantly broaden our customer reach and raise awareness for the BARK brand. We believe that this business also serves to introduce first-time customers to BARK who later could become loyal subscribers of our DTC business.
The Company currently sells products in over 50,000 retail doors nationwide, including Target, Walmart, Kroger, Petco, and PetSmart. We also sell our products on other online platforms including Amazon and Chewy. We believe that these partnerships significantly broaden our customer reach and raise awareness for the BARK brand.
Vertically Integrated: All of our products are designed, developed, and branded BARK, which drives higher margins, compared to companies that primarily sell third-party products. We believe that our data and insights have enabled us to design and make superior products for dogs as well as to create new products that dogs and their dog parents love.
We believe that our data and insights have enabled us to design and make superior products for dogs as well as to create new products that dogs and their dog parents love.
Trademarks and Other Intellectual Property We believe that our rights to our intellectual property, including trademarks and domain names, as well as contractual provisions and restrictions on access to our proprietary technology, are important to our marketing efforts to develop brand recognition and differentiate our brand from competitors.
BARK manages its inventory levels by analyzing product sell-through, forecasting demand, analyzing product ratings, and placing orders with our manufacturers before BARK receives firm orders from customers to ensure sufficient availability. 8 Table of Contents Trademarks and Other Intellectual Property We believe that our rights to our intellectual property, including trademarks and domain names, as well as contractual provisions and restrictions on access to our proprietary technology, are important to our marketing efforts to develop brand recognition and differentiate our brand from competitors.
Today, BARK products are sold in over 40,000 retail doors, including Target, Walmart, Kroger, Petco, and PetSmart. This segment represented 11.0% of our total revenue in fiscal 2024. We see a significant opportunity to grow our presence in retail. Today, the majority of our commerce revenue consists of selling our toys in retail.
This segment represented 14.1% of our total revenue in fiscal 2025, and we see a significant opportunity to grow our presence in retail. Today, the majority of our commerce revenue consists of selling our toys in retail. Last year, the Company began selling its new treat offering in over 2,400 Target and PetSmart doors nationwide.
Customers have the option to subscribe to these products on a one month, six month, or twelve month basis. During the life of their subscription, we offer our customers incremental products via ATB, which allows us to cross-sell customers our full portfolio of products including kibble, treats, toppers, dental, and more.
During the life of their subscription, we offer our customers incremental products via ATB, which allows us to cross-sell customers across our full portfolio of products including kibble, treats, toppers, dental, and more. 4 Table of Contents We also sell toys through our network of retail partners. Today, the commerce segment accounts for 14% of total revenue.
Our employee population includes approximately 393 BARK Happy Ambassadors and their leadership, 76 engineers, data scientists, and technology staff, 59 designers and creative team members, 81 operations and fulfillment center employees, and 101 marketing, general, and administrative employees.
Our employee population includes approximately 426 BARK Happy Ambassadors and their leadership, 40 engineers, data scientists, information security, and technology staff, 59 operations employees, and 166 marketing, creative, general, and administrative employees. As of March 31, 2025, 69% of our employees, 30% of our management team, and 43% of our Board of Directors identified as female or nonbinary.
Recently, we began selling our new treat offering in over 2,400 Target and PetSmart doors nationwide. The Company anticipates further expanding its consumables presence in retail in the future.
Since then, the Company has been expanding its treat offering in retail and anticipates further expansion of its treat and consumables presence in retail in the future.
These logistics providers manage various distribution activities including product receipt, warehousing, assembly, certain limited product inspection activities, and coordinating outbound shipping. BARK manages its inventory levels by analyzing product sell-through, forecasting demand, analyzing product ratings, and placing orders with our manufacturers before BARK receives firm orders from customers to ensure sufficient availability.
These logistics providers manage various distribution activities including product receipt, warehousing, assembly, certain limited product inspection activities, and coordinating outbound shipping.
We are currently in the process of unifying our brand under the bark.co domain so all of our products are sold under one roof. This will improve the customer experience, raise awareness of our full suite of products, and enhance our cross-selling capabilities. We anticipate migrating all of our platforms to bark.co this fiscal year.
Now, all of our products are available under one roof, and on a modern technology solution. This will improve the customer experience, raise awareness of our full suite of products, and enhance our cross-selling capabilities. The new platform also enables us to offer important features like Shop Pay and Apple Pay.
We engage with employees through periodic surveys to measure employee engagement, receive feedback, and respond to employee concerns effectively. We leverage these data points to continuously evolve our policies and practices to meet employee needs and align with BARK team values.
Employee Engagement 7 Table of Contents Team communication is frequent and direct, allowing for a high level of transparency and feedback. We engage with employees through periodic surveys to measure employee engagement, receive feedback, and respond to employee concerns effectively.
BARK Bright eliminates the arduous task of brushing a dog’s teeth while still effectively fighting germs and bad breath. Our BARK Bright dental kit provides an innovative regimen for dog dental care. Overall, we see significant runway in our consumables category long-term, and anticipate the majority of our future growth may be driven by these product categories.
This category is currently included in our Direct to Consumer segment. 5 Table of Contents Overall, we see significant runway in our consumables category long-term, and anticipate the majority of our future to be driven by these product categories along with services, like BARK Air.
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An accelerating shift to digital and e-commerce: E-commerce sales continue to grow faster than the overall retail sales market and are increasingly taking significant share from brick-and-mortar retail. Sales of dog-related products have mirrored this trend as dog owners increasingly shift a greater share of their dog-related purchasing to online options and subscription-based offerings across all categories.
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Our Segments and Products We operate two business segments: DTC and commerce. Our DTC business drives the majority of our revenues today, representing 85.9% of total revenue in fiscal 2025.
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According to the market research firm Packaged Facts, an estimated 37% of all pet product sales occurred online in 2023. By 2028, Packaged Facts estimates roughly 44% of all U.S. pet sales will occur online. Our Segments and Products We operate two business segments: direct to consumer and commerce.
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While toys & accessories have driven the majority of revenues in this segment, we are increasingly focused on expanding our presence in consumables and services due to their larger addressable markets, less discretionary nature, and resilience to external pressures such as tariffs.
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Over the years, we have become increasingly more effective at cross-selling to customers. Total cross sell revenue was $38 million in fiscal 2024. We also sell toys through our network of retail partners. Today, the commerce segment accounts for 11% of total revenue. This distribution channel allows us to reach new customers and introduce them to the BARK brand.
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Customers have the option to subscribe to these products on a one month, three month, six month, or twelve month basis.
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While our kibble can be purchased on an individual basis, we often recommend meal plans consisting of a mix of kibble, toppers, and/or supplements based on the characteristics and personalities of each dog. For example, because German Shepherds are prone to hip issues, we often recommend hip and joint support supplements with the purchase of their kibble.
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While toys & accessories remain a core component of our offering and brand identity in fiscal 2026, we are actively reallocating resources toward our consumables and services categories as we expect toys to face headwinds due to macroeconomic factors, shifting consumer behavior, and newly imposed tariffs on imports from China, where the majority of our toys are currently sourced.
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If that dog is also a picky eater, we will recommend adding one of our toppers. This increases our average order value and margin profile. Dental —Also known as BARK Bright, this category includes a variety of chews and toothpastes aimed at improving your dog’s dental health.
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The Company also began selling its treats in over 2,400 doors nationwide in Spring of 2024. The Company has been expanding its treat offering among other partners, including Amazon, Chewy, and Meijer and anticipates further expansion in the year ahead.
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As of March 31, 2024, 68% of our employees, 38% of our management team, and 43% of our Board of Directors identified as female or nonbinary. Employee Engagement Team communication is frequent and direct, allowing for a high level of transparency and feedback.
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Our kibble can be purchased on an individual or autoship basis Dental —Also known as BARK Bright, this category includes a variety of chews and toothpastes aimed at improving your dog’s dental health. BARK Bright eliminates the arduous task of brushing a dog’s teeth while still effectively fighting germs and bad breath.
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Our BARK Bright dental kit provides an innovative regimen for dog dental care. Overall, we see significant runway in our consumables category in both our Direct to Consumer and commerce segments, long-term. As of fiscal 2025, consumables represent approximately one-third of total revenue and are sourced almost entirely from domestic partners, providing greater insulation from geopolitical risks and tariff impacts.
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In its first fiscal year, BARK Air generated $5.8 million of revenue with strong utilization rates and customer demand. As our flagship entry into the services category, BARK Air is part of a broader strategy to expand into premium, differentiated dog services.
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With new routes, expanded partnerships, and high early engagement, we believe BARK Air and future services represent a meaningful long-term growth opportunity.
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In-House Product Design and Development: All of our products are designed and developed in-house, and branded BARK, which helps drive our strong gross margins versus companies primarily selling third-party products.
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The Company also generates a similar contribution margin across its DTC and commerce segments. Additionally, in fiscal 2025, the Company migrated to Shopify, consolidating five previously siloed properties—BarkBox, Super Chewer, BARK Bright, BarkFood, and BarkShop—under one domain: Bark.co. This transition provides modern tools like Shop Pay and Apple Pay, simplifies cross-selling, and improves visibility into our full product suite.
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Our ambition is to grow BARK to be the world’s favorite dog brand. We are focused on several key areas that we believe will be significant drivers to our business, long-term.
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Expansion in our Commerce Segment In fiscal 2025, revenue from the sale of BARK products through our retail and e-commerce partners totaled $68 million, or 14.1% of our total revenue. This reflects a 27.2% increase compared to fiscal 2024.
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We expect this channel to contribute an increasingly significant portion of our revenue moving forward, driven by continued expansion of our product assortment and retail presence with existing partners, as well as the addition of new partners both domestically and internationally.
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Business Strategy The Company’s is focused on enhancing profitability, strengthening its operating model, and positioning the business for long-term growth and value creation. In fiscal 2025, the Company achieved its first full year of positive Adjusted EBITDA, driven by improvements in operational efficiency, gross margin, and cost structure.
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As part of a strategic shift, the Company is reducing its reliance on promotion-driven direct-to-consumer subscription models and reallocating resources toward categories and channels that offer scalability, consumer reach, and resilience—particularly consumables, services, and retail commerce.
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The Company is accelerating growth in its consumables business, which is primarily sourced in the United States and less exposed to global trade volatility, and is expanding its retail distribution footprint through partnerships with leading retailers.
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In addition, the Company is investing in new service offerings, such as BARK Air, and maintaining a lean operating model to support disciplined capital allocation. These strategic initiatives are intended to preserve profitability and position the business to deliver sustained long-term value.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur ability to leverage our competitive strengths and execute on our strategy is subject to numerous challenges and uncertainties including, but not limited to, the following: • costs or other issues with acquiring new customers and retaining existing customers; • adverse impacts on shipping and fulfillment services and costs; • changes in trends and consumer preferences; • interruptions in our business due to technology failures, cybersecurity breaches or labor shortages; • our ability to retain existing suppliers and attract new suppliers and scale our supply chain; • our ability to develop a unified, scalable, high-performance technology and fulfillment infrastructure; • our ability to hire and retain talented, experienced people at all levels of our organization; and • changes in the macro-economic environment, such as inflation, increasing interest rates, instability in the banking system or financial markets, changes in the labor markets, and political, economic and social instability, such as war in Israel and the Ukraine or pandemics such as COVID 19, in particular as such changes impact consumer discretionary spending.
Biggest changeOur past operating performance may not be indicative of our future operating performance, which depends on our ability to execute our strategy while successfully navigating numerous challenges and uncertainties including, but not limited to, the following: • our migration of current and future customers to our unified platform; • costs or other issues with acquiring new customers and retaining existing customers; • adverse impacts on shipping and fulfillment services and costs, including related to the imposition of current tariffs and the uncertainty relating to such tariff rates in the future, and shipping lane constraints and/or labor disputes; • changes in consumer trends and preferences and/or discretionary spending, which would negatively impact our revenue; • interruptions in our business due to technology failures, cybersecurity breaches or labor shortages; • our ability to retain existing suppliers and attract new suppliers and scale our supply chain; • our ability to develop a unified, scalable, high-performance technology and fulfillment infrastructure; • our ability to hire and retain talented, experienced people at all levels of our organization; and • the imposition of new or increased tariffs that disrupt our supply chain, or negatively impact our revenue and profitability; and • deterioration of the macro-economic environment resulting in disruptions in global trade (in particular due to the imposition of tariffs and uncertainty relating to such tariffs), inflation, increasing interest rates, instability in the banking system or financial markets, changes in the labor markets, and political, economic and social instability, such as wars, armed conflicts or pandemics, in particular as such changes impact our 10 Table of Contents revenue through reduced consumer discretionary spending, our cost structure or our supply chain.
If our estimates of the size of our addressable market are not accurate, our potential for future growth may be less than we currently anticipate, which could have a material adverse effect on our business, financial condition, and results of operations. We may not be able to compete effectively in the dog products and services retail industry.
If our estimates of the size of our addressable market are not accurate, our potential for future growth may be less than we currently anticipate, which could have a material adverse effect on our business, financial condition, and results of operations. We may not be able to compete effectively in the dog products and services industry.
If we fail to effectively meet the challenges described above our business and future operating results will be materially adversely affected. Risks Related to the Macro-Economic Environment We rely on consumer discretionary spending, which may be adversely affected by economic downturns and other macroeconomic conditions or trends. Our business depends on consumer discretionary spending.
If we fail to effectively meet the challenges described above our business and future operating results will be materially adversely affected. Risks Related to the Macro-Economic Environment We rely on consumer discretionary spending, which may be adversely affected by economic downturns and other macroeconomic conditions, events, or trends. Our business depends on consumer discretionary spending.
In the future, we could be required to raise capital through public or private financing or other arrangements. Such financing may not be available on acceptable terms, or at all, and our failure to raise capital when needed could harm our business.
In the future, we could be required to raise capital through public or private financing or other debt arrangements. Such capital may not be available on acceptable terms, or at all, and our failure to raise capital when needed could harm our business.
We rely on SaaS technologies from third parties in order to operate critical functions of our business, including financial management services, credit card processing, customer relationship management services, supply chain services and data storage services.
We rely on SaaS technologies from third parties in order to operate critical functions of our business, including site management, financial management services, credit card processing, customer relationship management services, supply chain services and data storage services.
We prepare our financial statements in accordance with U.S. GAAP, which requires our management to make estimates, judgments, and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes.
We prepare our financial statements in accordance with U.S. GAAP, which requires our management to make estimates, judgments, and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes.
Our business, financial condition and results of operations could be materially adversely affected if fees associated with lawsuits or other legal proceedings or a judgment, penalty or fine is not fully or is only partially covered by insurance. General Risk Related to Our Business Our estimates or judgments relating to our critical accounting policies could prove to be incorrect.
Our business, financial condition and results of operations could be materially adversely affected if fees associated with lawsuits or other legal proceedings or a judgment, penalty or fine is not fully or is only partially covered by insurance. General Risks Related to Our Business Our estimates or judgments relating to our critical accounting policies could prove to be incorrect.
If we fail to meet the challenges or navigate the uncertainties described above, as well as those described elsewhere in this “Risk Factors” section, our business, financial condition and results of operations will be materially adversely affected. We may fail to acquire new customers in a cost-effective manner.
If we fail to meet the challenges or navigate the uncertainties described above, as well as those described elsewhere in this “Risk Factors” section, our business, financial condition and results of operations will be materially adversely affected. We may fail to acquire and retain customers in a cost-effective manner.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The results of these estimates form the basis for making judgments about the carrying values of assets, liabilities, and equity as of the date of the financial statements, and the amount of revenue 19 Table of Contents and expenses, during the periods presented, that are not readily apparent from other sources.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The results of these estimates form the basis for making judgments about the carrying values of assets, liabilities, and equity as of the date of the financial statements, and the amount of revenue and expenses, during the periods presented, that are not readily apparent from other sources.
In addition, the stock market has recently experienced extreme price and volume fluctuations and companies have experienced fluctuations in their stock prices that have often been unrelated or disproportionate to their operating results. Under these circumstances, stockholders may sometimes institute securities class action litigation against such companies.
In addition, the stock market has experienced price and volume fluctuations and companies have experienced fluctuations in their stock prices that have often been unrelated or disproportionate to their operating results. Under these circumstances, stockholders may sometimes institute securities class action litigation against such companies.
We depend on these indirect sales channel partners to distribute and sell our products to dog parents, which subjects us to a number of challenges, including: • the sales and business practices, reputation or failure to comply with laws and regulations, of or by our sales channel partners, of which we may or may not be aware, may affect our business and reputation; • adverse changes in our relationships with our sales channel partners could impact sales of our products; • economic conditions, labor issues, natural disasters, regional or global pandemics, evolving consumer preferences, and purchasing patterns of our distribution partners, or competition between our sales channels, could result in sales channel disruption; • our sales channel partners, who also sell products offered by our competitors, and in the case of retailer house brands, may also be our competitors, which sales may compete with our own products; • certain of our sales channel partners could decide to de-emphasize the product categories that we offer, change their algorithmic logic, policies or procedures making our products harder for customers to find, or remove them from e-commerce sites altogether; and • building relationships with new channel partners or adapting to new distribution and marketing models in order to expand into new product categories and markets may require significant management attention and operational resources, and affect our accounting, including revenue recognition, gross margins, and the ability to make comparisons from period to period.
We depend on these indirect sales channel partners to distribute and sell our products to dog parents, which subjects us to a number of challenges, including: • the sales and business practices, reputation or failure to comply with laws and regulations, of or by our sales channel partners, of which we may or may not be aware, may affect our business and reputation; • adverse changes in our relationships with our sales channel partners could impact sales of our products; • economic conditions, labor issues, natural disasters, severe weather events, regional or global pandemics, evolving consumer preferences, and purchasing patterns of our distribution partners, or competition between our sales channels, which result in sales channel disruptions; • our sales channel partners, who also sell products offered by our competitors, and in the case of retailer house brands, may also be our competitors, which sales may compete with sales of our own products; • certain of our sales channel partners could decide to de-emphasize the product categories that we offer, change their algorithmic logic, policies or procedures making our products harder for customers to find, or remove them from sales channels altogether; and • building relationships with new channel partners or adapting to new distribution and marketing models in order to expand into new product categories and markets may require significant management attention and operational resources, and affect our accounting, including revenue recognition, gross margins, and the ability to make comparisons from period to period.
In the future, as we offer new payment options to customers, including by way of integrating emerging mobile and other payment methods, we may be subject to additional regulations, compliance requirements and fraud, if our customers re-use their login and password information across multiple websites, exposing us to breaches on other sites.
In the future, as we offer new payment options to customers, including by way of integrating emerging 15 Table of Contents mobile and other payment methods, we may be subject to additional regulations, compliance requirements and fraud, if our customers re-use their login and password information across multiple websites, exposing us to breaches on other sites.
For example, the State of California enacted the California Consumer Privacy Act of 2018 (the “CCPA”), which requires companies that 17 Table of Contents process information on California residents make new disclosures to customers about the collection of their data, use and sharing practices, and allow customers to opt out of certain data sharing with third parties and provides a new cause of action for data breaches.
For example, the State of California enacted the California Consumer Privacy Act of 2018 (the “CCPA”), which requires companies that process information on California residents make new disclosures to customers about the collection of their data, use and sharing practices, and allow customers to opt out of certain data sharing with third parties and provides a new cause of action for data breaches.
This regulation of the use of cookies and other current online tracking and advertising practices or the loss of our ability to make effective use of services that employ such technologies could limit our ability to acquire new customers on cost-effective terms, which could materially adversely affect our business, financial condition, and results of operations.
This regulation of the use of cookies and other current online tracking and advertising practices, and litigation related to the same, or the loss of our ability to make effective use of services that employ such technologies could limit our ability to acquire new customers on cost-effective terms, which could materially adversely affect our business, financial condition, and results of operations.
Any harm to our reputation or brand, being subject to regulatory action and incurring related fees, distraction of our management and loss of customers or suppliers could have a material adverse effect on our business, financial condition and results of operations. We are subject to product safety, labor, or other laws.
Any harm to our reputation or brand, being subject to regulatory action and incurring related fees, distraction of our management and 18 Table of Contents loss of customers or suppliers could have a material adverse effect on our business, financial condition and results of operations. We are subject to product safety, labor, or other laws.
Delaware law, our certificate of incorporation and bylaws may impede a merger, tender offer, or proxy contest. Our certificate of incorporation and amended and restated bylaws contain provisions that could depress the trading price of our common stock by impeding a change in control of BARK or changes in our management that our stockholders may deem advantageous.
Delaware law, our certificate of incorporation and bylaws may impede a merger, tender offer, or proxy contest. 22 Table of Contents Our certificate of incorporation and amended and restated bylaws contain provisions that could depress the trading price of our common stock by impeding a change in control of BARK or changes in our management that our stockholders may deem advantageous.
Our operations, including our manufacturing partners, are subject to regulation by the Occupational Safety and Health Administration, the Food 18 Table of Contents and Drug Administration, the Department of Agriculture and by various other federal, state, local and foreign authorities regarding the processing, packaging, storage, distribution, advertising, labeling and export of our products, including food safety standards.
Our operations, including our manufacturing partners, are subject to regulation by the Occupational Safety and Health Administration, the Food and Drug Administration, the Department of Agriculture and by various other federal, state, local and foreign authorities regarding the processing, packaging, storage, distribution, advertising, labeling and export of our products, including food safety standards.
Failure to implement in a timely manner appropriate internal systems, procedures and controls could materially and adversely affect our business, financial condition and results of operations. We may not be able to successfully optimize, operate and manage our fulfillment centers and shipping services.
Failure to implement in a timely manner appropriate internal systems, procedures and controls could materially and adversely affect our business, financial condition and results of operations. 14 Table of Contents We may not be able to successfully optimize, operate and manage our fulfillment centers and shipping services.
In addition, if our stock price does not meet the conversion price of the 2025 Convertible Notes, then we will have to repay the principal of the 2025 Convertible Notes in cash, which we may not have available. Our revolving credit facility also contains covenants requiring us to satisfy certain financial covenants.
In addition, if our stock price does not meet the conversion price of the 2025 Convertible Notes, then we will have to repay the principal of the 21 Table of Contents 2025 Convertible Notes in cash, which we may not have available. Our revolving credit facility also contains covenants requiring us to satisfy certain financial covenants.
The market price of our common stock may fluctuate significantly or decline in response to numerous factors, many of which are beyond our control, including: actual or anticipated fluctuations in our revenue and results of operations; financial projections we may provide to the public, any changes in these projections or our failure to meet these projections; failure of securities analysts to maintain coverage of BARK, changes in financial estimates or ratings by any securities analysts who follow BARK or our failure to meet the estimates or the expectations of investors; announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, or capital commitments; changes in operating performance and stock market valuations of other retail or technology companies generally, or those in our industry in particular; price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; trading volume of our common stock; the inclusion, 21 Table of Contents exclusion or removal of our common stock from any indices; changes in members of our Board of Directors or management; transactions in our common stock by directors, officers, affiliates and other major investors; lawsuits threatened or filed against us; changes in laws or regulations applicable to our business; changes in our capital structure, such as future issuances of debt or equity securities; short sales, hedging and other derivative transactions involving our capital stock; general economic conditions in the U.S. or global markets; other events or factors, such as the COVID-19 pandemic, the war in the Ukraine, increased inflation, bank failures, incidents of terrorism or responses to these events; and the other events or factors described in this “Risk Factors” section.
The market price of our common stock may fluctuate significantly or decline in response to numerous factors, many of which are beyond our control, including: actual or anticipated fluctuations in our revenue and results of operations; financial projections we may provide to the public, any changes in these projections or our failure to meet these projections; failure of securities analysts to maintain coverage of BARK, changes in financial estimates or ratings by any securities analysts who follow BARK or our failure to meet the estimates or the expectations of investors; announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, or capital commitments; changes in operating performance and stock market valuations of other retail or technology companies generally, or those in our industry in particular; price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; trading volume of our common stock; the inclusion, exclusion or removal of our common stock from any indices; changes in members of our Board of Directors or management; transactions in our common stock by directors, officers, affiliates and other major investors; lawsuits threatened or filed against us; changes in laws or regulations applicable to our business; changes in our capital structure, such as future issuances of debt or equity securities; short sales, hedging and other derivative transactions involving our capital stock; general economic conditions in the U.S. or global markets; other events or factors, such as a global pandemic, wars or other armed conflicts, inflation, bank failures, incidents of terrorism or responses to these events; and the other events or factors described in this “Risk Factors” section.
We are currently monitoring changes in the tax landscape, however, it is difficult to predict whether such changes could materially adversely affect our financial condition and results of operations. Future litigation could have a material adverse effect on our business.
We are currently monitoring changes in the tax landscape, however, it is difficult to predict whether such changes could materially adversely affect our financial condition and results of operation Current and future litigation could have a material adverse effect on our business.
In order to maintain effective internal control over financial reporting, we must perform system and process evaluations, document our controls and perform testing of our key controls over financial reporting to allow for management and our independent public accounting firm to report on the effectiveness of our internal control over financial reporting.
In order to maintain effective internal control over financial reporting, we must perform system and process evaluations, document our controls and perform testing of our key controls over financial reporting to allow for management and our independent public accounting firm to report on the effectiveness of our internal control over 20 Table of Contents financial reporting.
In addition, others may independently develop or otherwise acquire equivalent or superior technology. Our confidentiality agreements may not effectively prevent disclosure of our proprietary information, technologies and processes and may not provide an adequate remedy in the event of unauthorized disclosure of such information.
In addition, others may independently develop or otherwise acquire equivalent or superior technology. Our confidentiality agreements may not effectively prevent disclosure of our proprietary information, technologies and processes and may not provide an adequate remedy in 17 Table of Contents the event of unauthorized disclosure of such information.
We also have the ability to issue equity awards that are convertible into shares of our common stock under our 2021 Equity Incentive Plan and under our Employee Stock Purchase Plan, see Note 6 — Debt, and Note 9 — Stock-Based Compensation Plans, to our consolidated financial statements set forth in this quarterly report on Form 10-K.
We also have the ability to issue equity awards that are convertible into shares of our common stock under our 2021 Equity Incentive Plan and under our Employee Stock Purchase Plan, see Note 6 — Debt, and Note 8 — Stock-Based Compensation Plans, to our consolidated financial statements set forth in this Annual Report on Form 10-K.
To be successful, we must accurately predict and respond to evolving consumer trends, demands and preferences, including predicting monthly themes for our BarkBox and Super Chewer subscriptions that will resonate with customers as timely and clever. The development and introduction of new products and expansion into new offerings also involves considerable costs.
To be successful, we must accurately predict and respond to evolving consumer trends, demands and preferences, including predicting successful monthly themes for BarkBox and Super Chewer subscriptions that will resonate with our customers. The development and introduction of new products and expansion into new offerings and services also involves considerable costs.
Failure to maintain our high level of engagement and protect our brand and reputation with our customers would cause our revenue to decrease, which could have a material adverse effect on our business, financial condition and results of operations.
Failure to maintain our high level of engagement and protect our brand and reputation with our customers would cause our revenue to decrease and/or our costs to increase, which could have a material adverse effect on our business, financial condition and results of operations.
No market for the 2025 Convertible Notes exists and may not develop. Even if a market develops, it may not persist. We do not intend to apply for listing of the 2025 Convertible Notes on any securities exchange or other 23 Table of Contents market.
No market for the 2025 Convertible Notes exists and may not develop. Even if a market develops, it may not persist. We do not intend to apply for listing of the 2025 Convertible Notes on any securities exchange or other market.
We may not be able to accurately predict consumer trends, successfully introduce new products, improve existing products, or expand into new offerings.
We may not be able to accurately predict consumer trends, successfully introduce new products and services, improve existing products and services, or expand into new offerings.
If the costs of acquiring new customers exceeds our expectations, we may not be able to acquire the necessary number of customers who purchase products in volumes sufficient to grow our business and generate the scale necessary to achieve operational efficiency and/or our margins could decrease, which could have a material adverse effect on our business, financial condition and results of operations.
If the costs of acquiring or retaining our customers exceeds our expectations, we may not be able to acquire or retain the necessary number of customers to purchase products or services in volumes sufficient to grow our business and generate the scale necessary to achieve operational efficiency and/or our margins could decrease, which could have a material adverse effect on our business, financial condition, and results of operations.
We sell some of our products through a network of retailers and e-tailers (in addition to our direct sales channel). Our products are available through Amazon.com as well as in retail locations including Target, Petco, 11 Table of Contents PetSmart, Costco, Walmart, Kroger and CVS, and many others.
We sell some of our products through a network of retailers and e-retailers (in addition to our direct sales channel). Our products are available through Amazon.com as well as in retail locations including Target, Petco, PetSmart, Costco, Walmart, Kroger and CVS, and many others.
Our issuance of additional shares of common stock or other equity securities of equal or senior rank would dilute our existing shareholders and may cause the market price of our common stock to decline. Risks Related to the 2025 Convertible Notes Our obligation to redeem the 2025 Convertible Notes may not protect holders.
Our issuance of additional shares of common stock or other equity securities of equal or senior rank would dilute our existing shareholders and may cause the market price of our common stock to decline. 23 Table of Contents Risks Related to the 2025 Convertible Notes Our obligation to redeem the 2025 Convertible Notes may not protect holders of those notes.
The techniques used to obtain unauthorized access or to sabotage 16 Table of Contents systems change frequently and generally are not identified until they are launched against a target, and we, and our vendors, may be unable to anticipate these techniques or to implement adequate preventative measures.
The techniques used to obtain unauthorized access or to sabotage systems change frequently and generally are not identified until they are launched against a target, and we, and our vendors, may be unable to anticipate these techniques or to implement adequate preventative measures.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to determination of fair value of the Company’s allowance for uncollectible accounts receivable, excess and obsolete inventory reserve, stock-based compensation, stand-alone selling price of Direct to Consumer offerings, the fair value of right-of-use assets, and the valuation of embedded derivatives.
Significant assumptions and estimates used in preparing our condensed consolidated financial statements include those related to determination of fair value of the Company’s allowance for uncollectible accounts receivable, excess and obsolete inventory, stock-based compensation, stand-alone selling price of Direct to Consumer offerings, and the fair value of right-of-use assets.
We face a number of risks relating to these providers, including: • our suppliers, manufacturers or logistics partners could be impacted by a natural disaster, an epidemic or pandemic, or other interruptions at a particular location; • our manufacturers and suppliers are primarily located in Asia, which introduces risks related to geopolitical developments and differences in regulatory standards and legal systems; • our existing supply channels may not be able to satisfy a significant increase in demand for our products, or we may need to replace an existing manufacturer or supplier.
We face a number of risks relating to these providers, including: • our suppliers, manufacturers or logistics partners could be impacted by a natural disaster or severe weather events, an epidemic or pandemic, or other interruptions at a particular location; • our manufacturers and suppliers for our toys are primarily located in Asia, which introduces risks related to changes in trade policies, including the imposition of tariffs, geopolitical developments and differences in regulatory standards and legal systems; • our existing supply channels may not be able to satisfy a significant increase in demand for our products, or we may need to replace an existing manufacturer or supplier.
Certain of our key performance indicators are subject to inherent challenges in measurement, and real or perceived inaccuracies. We track certain key performance indicators, including metrics such as average order value and customer acquisition costs, with internal systems and tools.
Certain of our key performance indicators are subject to inherent challenges in measurement, and real or perceived inaccuracies. We track certain key performance indicators, including metrics such as total orders and average order value, with internal systems and tools.
Furthermore, any increases in consumer discretionary spending during times of crisis may be temporary, such as those related to government stimulus programs or remote-work environments, and consumer spending may decrease when those programs or circumstances end.
Furthermore, any increases in consumer discretionary spending during times of crisis may be temporary, such as those related to government stimulus programs or tax cuts, and consumer spending may decrease when those programs or circumstances end.
We have limited control over our suppliers, contract manufacturers, and logistics partners, which subjects us to the following risks, many of which materialized during the COVID-19 pandemic, including: failure to satisfy demand for our products; reduced control over delivery timing, product reliability, the manufacturing process and components used in our products; limited ability to develop comprehensive manufacturing specifications that take into account any materials shortages or substitutions; variance in the manufacturing capability of our third-party manufacturers; price increases; failure of a significant supplier, manufacturer, or logistics partner to perform its obligations for technical, market, or other reasons; misappropriation of our intellectual property; changes in local economic conditions in the jurisdictions where our suppliers, manufacturers, and logistics partners are located; the imposition of new laws and regulations, including those relating to labor conditions, quality and safety standards, imports, duties, tariffs, taxes, and other charges on imports, as well as trade restrictions and restrictions on currency exchange or the transfer of funds; and insufficient warranties and indemnities on components supplied to our manufacturers or performance by our partners.
Such disruptions could result in failure to satisfy demand for our products; reduced control over delivery timing, product reliability, the manufacturing process and components used in our products; limited ability to develop comprehensive manufacturing specifications that take into account any materials shortages or substitutions; variance in the manufacturing capability of our third-party manufacturers; price increases; failure of a significant supplier, manufacturer, or logistics partner to perform its obligations for technical, market, or other reasons; misappropriation of our intellectual property; changes in local economic conditions in the jurisdictions where our suppliers, manufacturers, and logistics partners are located; the imposition of new laws and regulations, including those relating to labor conditions, quality and safety standards, imports, duties, tariffs, taxes, and other charges on imports, as well as trade restrictions and restrictions on currency exchange or the transfer of funds; and insufficient warranties and indemnities on components supplied to our manufacturers or performance by our partners.
These provisions include: a classified board; removal of directors only for cause or a super majority vote; super majority vote required to amend of certain provisions of our certificate of incorporation and any provisions of our bylaws; issuance of “blank check” preferred stock authorized; stockholders may not call special stockholder meetings; stockholder action by written consent prohibited; indemnification of our director and officers; Board of Directors is expressly authorized to make, alter, or repeal our bylaws; and advance notice requirements for nominations for election to our Board of Directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings. 22 Table of Contents Substantially all disputes between BARK and our stockholders are subject to exclusive forum provisions.
These provisions include: a classified board; removal of directors only for cause or a super majority vote; super majority vote required to amend of certain provisions of our certificate of incorporation and any provisions of our bylaws; issuance of “blank check” preferred stock authorized; stockholders may not call special stockholder meetings; stockholder action by written consent prohibited; indemnification of our director and officers; Board of Directors is expressly authorized to make, alter, or repeal our bylaws; and advance notice requirements for nominations for election to our Board of Directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
In addition, our ability to receive inbound inventory efficiently and ship merchandise to customers may be negatively affected by factors beyond our and these providers’ control, including inclement weather, natural disasters, fire, flood, power loss, earthquakes, pandemics, acts of war or terrorism or other events specifically impacting our or 13 Table of Contents other shipping partners, such as labor disputes, financial difficulties, system failures and other disruptions to the operations of the shipping companies on which we rely.
In addition, our ability to receive inbound inventory efficiently and ship merchandise to customers may be negatively affected by factors beyond our and these providers’ control, including severe weather events, natural disasters, fire, flood, power loss, earthquakes, pandemics, acts of war or terrorism, potential trade wars, including current or potential future tariffs, or other events specifically impacting our or other shipping partners, such as labor disputes, financial difficulties, system failures and other disruptions to the operations of the shipping companies on which we rely.
Our omnichannel operations, such as offering our products through our websites, on third party websites and in traditional brick and mortar stores, create additional complexities in our ability to manage inventory levels, as well as certain operational issues, including timely shipping and refunds.
We may be unable to manage the complexities created by our omnichannel operations. Our omnichannel operations, such as offering our products through our websites, on third party websites and in traditional brick and mortar stores, create additional complexities in our ability to manage inventory levels, as well as certain operational issues, including timely shipping and refunds.
Any web or mobile platform interruption or inadequacy that causes performance issues or interruptions in the availability of our websites or mobile application could reduce consumer satisfaction and result in a reduction in the number of customers using our products and services, which could have a material adverse effect on our business, financial condition and results of operations.
Any web or mobile platform interruption or inadequacy that causes performance issues or interruptions in the availability of our websites or mobile application could reduce consumer satisfaction and result in a reduction in the number of customers using our products and services, which could have a material adverse effect on our business, financial condition and results of operations. 16 Table of Contents Our disaster recovery arrangements may be insufficient.
If our existing stockholders sell or indicate an intention to sell substantial amounts of our common stock in the public market, the trading price of our common stock could decline.
Sales of shares by existing stockholders may cause our stock price to decline. If our existing stockholders sell or indicate an intention to sell substantial amounts of our common stock in the public market, the trading price of our common stock could decline.
In addition, economic conditions in certain regions may be affected by natural disasters, such as hurricanes, tropical storms, earthquakes, and wildfires; other public health crises; and other major unforeseen events.
In addition, economic conditions in certain regions may be affected by natural disasters or severe weather events, such as hurricanes, tropical storms, earthquakes, and wildfires; public health crises; tariff and trade wars, and other major unforeseen events.
Cloud computing, in particular, is dependent upon having access to an Internet connection in order to retrieve data. If a natural disaster, pandemic (such as the COVID-19 pandemic), blackout or other unforeseen event were to occur that disrupted our ability to obtain an Internet connection, we may experience a slowdown or delay in our operations.
Cloud computing, in particular, is dependent upon having access to an Internet connection in order to retrieve data. If a natural disaster or severe weather events, global pandemic, blackout or other unforeseen event were to occur that disrupted our ability to obtain an Internet connection, we may experience a slowdown or delay in our operations.
Any new product or offering may not generate sufficient customer interest to become a profitable product or to cover the costs of its development and promotion and could result in a decrease in customer retention, a reduction in purchases or negatively affect our brand and reputation.
In addition, new products, offerings or services may not generate sufficient customer interest to become profitable or cover the costs of development and promotion, which could result in a decrease in customer retention, a reduction in purchases, and/or negatively affect our brand and reputation.
Some of the factors that may negatively influence consumer spending include high levels of unemployment; higher consumer debt levels; reductions in net worth, declines in asset values, and related market uncertainty; home foreclosures and reductions in home values; fluctuating interest rates and credit availability; bank failures; global pandemics, and the loosening of restrictions as the pandemic conditions improve; fluctuating fuel and other energy costs; fluctuating commodity prices; and the high rate of inflation and general uncertainty regarding the overall future political and economic environment.
Some of the factors that may negatively influence consumer spending include economic recession, inflation or stagflation, high levels of unemployment; increases in consumer debt levels; reductions in net worth, declines in asset values, and related market uncertainties; home foreclosures and reductions in home values; fluctuating interest rates and credit availability; bank failures; global disruptions, fluctuating fuel and other energy costs; fluctuating commodity prices; and general uncertainty regarding the overall current and future political and economic environment.
For example, in the consumables category, there are numerous brands and products that compete for shelf space and sales, with competition based primarily upon brand recognition and loyalty, product packaging, quality and innovation, taste, nutrition, breadth of product line, price and convenience.
As we expand our offerings and services (such as consumables and BARK Air), we will face additional competition. For example, in the consumables category, there are numerous brands and products that compete for shelf space and sales, with competition based primarily upon brand recognition and loyalty, product packaging, quality and innovation, taste, nutrition, breadth of product line, price and convenience.
In addition, our vendors, or other third parties with whom we do business may attempt to circumvent security measures in order to misappropriate personal information, confidential information, or other data, or may inadvertently release or compromise such data.
If our business partners work remotely, they may be more vulnerable to cyber-attacks. In addition, our vendors, or other third parties with whom we do business may attempt to circumvent security measures in order to misappropriate personal information, confidential information, or other data, or may inadvertently release or compromise such data.
If one or more of the analysts initiate research with an unfavorable rating or downgrade our common stock, provide a more favorable recommendation about our competitors, or publish inaccurate or unfavorable research about our business, the price of our common stock could decline. Our certificate of incorporation may prevent us from receiving the benefit of certain corporate opportunities.
If one or more of the analysts initiate research with an unfavorable rating or downgrade our common stock, provide a more favorable recommendation about our competitors, or publish inaccurate or unfavorable research about our business, the price of our common stock could decline.
Any decline in consumer discretionary spending could negatively impact our revenue, which could have a material adverse effect on our business, financial condition and results of operations. We may continue to be impacted by the COVID-19 global pandemic.
Any decline in consumer discretionary spending could negatively 12 Table of Contents impact our revenue, which could have a material adverse effect on our business, financial condition and results of operations. We may be impacted by global disruptions or disasters.
We may be unable to maintain and scale our technology. Our reputation and ability to acquire, retain and serve our customers depends on the reliable performance of our websites and mobile application and our cloud-based solutions. The operation of these systems, and the consolidation of our websites, is complex and could result in operational failures.
We may be unable to maintain and scale our technology. Our reputation and ability to acquire, retain and serve our customers depends on the reliable performance of our websites and mobile application and our cloud-based solutions.
Any of the above risks could delay delivery of our products to customers in a timely and cost effective manner, which could have a material adverse effect on our business, financial condition and results of operations. We face challenges due to limited control over our suppliers, contract manufacturers, and logistics partners.
Any of the above risks could delay delivery of our products to customers in a timely and cost-effective manner, which could have a material adverse effect on our business, financial condition and results of operations.
Third parties have from time to time claimed, and may claim in the future, that we have infringed their intellectual property rights.
Third parties have from time to time claimed, and may claim in the future, that we have infringed their intellectual property rights, including through the use of artificial intelligence (AI) technologies.
Effective intellectual property protection may not be available in every country and the protection of our intellectual property rights may require significant financial, managerial and operational expenditures.
Effective intellectual property protection may not be available in every country and the protection of our intellectual property rights may require significant financial, managerial and operational expenditures. Artificial intelligence (AI) technologies also present novel risks to the protection of our intellectual property rights.
As 12 Table of Contents a result, it is difficult to predict the magnitude or scope of the adverse impacts that these effects may have directly, or indirectly, on our business, operating results and financial condition in the future.
As a result, it is difficult to predict the magnitude or scope of the adverse impacts that these effects may have directly, or indirectly, on our business, operating results and financial condition. Changes in trade policy or the imposition of tariffs could affect our revenue and profitability.
The dog products and services retail industry, in particular on the Internet, is highly competitive and we expect this competition to continue to increase. We compete with pet product retail stores, supermarkets, warehouse clubs 14 Table of Contents and other mass and general retail and online merchandisers.
The dog products and services industry, in particular online, is highly competitive and we expect this competition to increase. We compete with pet product retail stores, supermarkets, warehouse clubs and other mass and general retail and online merchandisers. We also compete with a number of specialty dog supply stores and independent dog stores, catalog retailers and other specialty e-retailers.
We, or our vendors, may suffer a data compromise from hackers or other unauthorized parties who gain access to personal information or other data, including payment card data or confidential business information, which may not be discovered in a timely fashion. In addition, cyber-attacks such as ransomware attacks could lock us out of our information systems and disrupt our operations.
We, or our vendors, may suffer a data compromise from hackers or other unauthorized parties who gain access to personal information or other data, including payment card data or confidential business information, which may not be discovered in a timely fashion.
If we fail to retain talented senior management and other key personnel, or if we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business, financial condition, and results of operations could be materially adversely affected. We face challenges due to our reliance on third party sales channels to sell and distribute our products.
If we fail to retain talented senior leaders and other key employees, or if we cannot recruit such individuals, our business, financial condition, and results of operations could be materially adversely affected. We face challenges due to our reliance on third party sales channels to sell and distribute our products.
We also anticipate the need to add additional fulfillment center and shipping capacity as our business continues to grow. We may not be able to locate suitable facilities or services on commercially acceptable terms in accordance with our expansion plans, or recruit qualified managerial and operational supply personnel to support our expansion plans.
We may not be able to locate suitable facilities or services on commercially acceptable terms in accordance with our expansion plans, or recruit qualified managerial and operational supply personnel to support our expansion plans.
Changes to the terms of our shipping arrangements and delays or failures in delivery of our products may have a material adverse effect on our margins and profitability, which could adversely affect our business, financial condition and results of operations. We may be unable to manage the complexities created by our omnichannel operations.
Further, there may be disruptions and delays in national, regional and local shipping, which may negatively impact our customers’ experience. Changes to the terms of our shipping arrangements and delays or failures in delivery of our products may have a material adverse effect on our margins and profitability, which could adversely affect our business, financial condition and results of operations.
If we are unable to anticipate, identify, develop or market products, or create new offerings that respond to changes in customer requirements and preferences, or if our new product introductions, repositioned products, or new offerings fail to gain consumer acceptance, we may be unable to grow our business as anticipated, or our revenue, margins and profitability may decline or not improve, which could materially adversely affect our business, financial condition and results of operations.
If we are unable to anticipate, identify, develop or market products, or create new offerings or services that respond to 11 Table of Contents changes in customer requirements and preferences, or if our product introductions, repositions, or new offerings or services fail to gain consumer acceptance, we may be unable to grow our business as anticipated.
If we cannot raise funds on acceptable terms, we may be forced to raise funds on undesirable terms, or our business may contract or we may be unable to grow our business or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition, and results of operations.
We may be forced to raise capital on undesirable terms or be unable to grow our business or respond to competitive pressures, which could have a material adverse effect on our business, financial condition, and results of operations. Risks Relating to Ownership of Our Common Stock Our stock price may be volatile or decline regardless of our operating performance.
Also, the 2017 Tax Cuts and Jobs Act may limit our ability to use our substantial net operating losses to offset potential future taxable income, which is further dependent upon by our ability to generate taxable income before the expiration dates of the net operating losses, and we cannot predict with certainty when, or whether, we will generate sufficient taxable income to use all of our net operating losses.
We are further dependent on the ability to generate taxable income before the expiration dates of the net operating losses, and we cannot predict with certainty when, or whether, we will generate sufficient taxable income to use all of our net operating losses.
Limitations on our use of “cookies” may impact our ability to cost-effectively acquire new customers. 15 Table of Contents Federal and state governmental authorities continue to evaluate the privacy implications inherent in the use of third-party “cookies” and other methods of online tracking for behavioral advertising and other purposes.
Federal and state governmental authorities continue to evaluate and enact legislation regarding the privacy implications inherent in the use of third-party “cookies” and other methods of online tracking for behavioral advertising and other purposes.
As we offer new payment options to customers, we may be subject to additional regulations, compliance requirements, fraud and other risks. For certain payment methods, we pay interchange and other fees, which may increase over time and raise our operating costs and lower profitability.
For certain payment methods, we pay interchange and other fees, which may increase over time and raise our operating costs and lower profitability.
We do not currently have alternative or replacement providers and we do not generally maintain long-term supply contracts with any of these providers.
We rely on a limited number of contract manufacturers, suppliers and logistics providers to manufacture and transport our products. We do not currently have alternative or replacement providers and we do not generally maintain long-term supply contracts with any of these providers.
Current and future competitors may also make strategic acquisitions or establish cooperative relationships among themselves or with others. If we fail to compete effectively, or are required to offer promotions and other incentives or adopt more aggressive pricing strategies, our operating margins could decrease, which could materially adversely affect our business, financial condition and results of operations.
If we fail to compete effectively, are required to offer promotions and other incentives or adopt more aggressive pricing strategies, our operating margins could decrease, which could materially adversely affect our business, financial condition and results of operations. Risks Related to Information Technology and Cybersecurity We are subject to risks related to online payment methods.
If we fail to meet the challenges described above, our business and future operating results will be materially adversely affected. Shipping, which is subject to numerous risks, is a critical part of our business. We currently rely on third-party national, regional and local logistics providers to deliver our products.
The results of the supply chain disruptions described above, could have a material adverse effect on our business, financial condition and results of operations. Shipping, which is subject to numerous risks, is a critical part of our business. We currently rely on third-party national, regional and local logistics providers to deliver our products.
Risks Related to Information Technology and Cybersecurity We are subject to risks related to online payment methods. We currently accept payments using a variety of methods, including credit card, debit card, PayPal, Venmo, Apple Pay, Shop Pay and gift cards.
We currently accept payments using a variety of methods, including credit card, debit card, PayPal, Venmo, Apple Pay, Shop Pay and gift cards. As we offer new payment options to customers, we may be subject to additional regulations, compliance requirements, fraud and other risks.
Our growth depends, in part, on our ability to successfully introduce new products to our existing BarkBox and Super Chewer subscriptions and Toys & accessories and Consumables categories, and to improve and reposition our existing products to meet the requirements of our customers and the needs of their dogs.
Our business growth partly depends on our ability to successfully introduce new products and services to our existing categories, and to improve and reposition our existing products to continue to meet the requirements of our customers.
Many of our personnel continue to work remotely, which could have a negative impact on the execution of our business plans and operations. Natural disasters, power outages, connectivity issues, or other events that impact our employees’ ability to work remotely, could disrupt business for a substantial period of time.
Natural disasters, power outages, connectivity issues, or other events that impact our employees’ or our partners’ ability to work remotely, could disrupt business for a substantial period of time. Global disruptions or disasters or severe weather events, have had, and could have, unprecedented and unexpected effects on the global economy, civil society, labor markets, and certain industries.
We may fail to manage or integrate acquisitions of, or investments in, new or complementary businesses, facilities, technologies or products, or through strategic alliances.
Our future growth and operating performance must eventually offset our operating losses or we may not be able to achieve or sustain profitability. We may fail to manage or integrate acquisitions of, or investments in, new or complementary businesses, facilities, technologies or products, or through strategic alliances.
All of our employees are at-will employees, meaning that they may terminate their employment relationship with us at any time, and their knowledge of our business and industry could be extremely difficult to replace.
Such individuals are in high demand and we may incur significant costs to recruit and retain them. All of our employees, including our senior leaders, are at-will employees who could terminate their employment relationship with us at any time. Their knowledge of, and contributions to, our business could be extremely difficult to replace.
Data for retail sales of dog products is collected for most, but not all channels, and as a result, it is difficult to accurately estimate the size of the market and predict with certainty the rate at which the market for our products will grow, if at all.
As a result, it is difficult to accurately estimate the size of the market, and predict with certainty the rate at which the market for our products will grow (if at all). While our market size estimate is made in good faith and is based on assumptions and estimates we believe to be reasonable, this estimate may not be accurate.
We must be able to appropriately, effectively and efficiently allocate our marketing spend for multiple products, including: accurately identifying, targeting and reaching our audience of current and potential customers with our marketing messages; selecting the right marketplace, media and specific media vehicle in which to advertise; adapting quickly to changes in the algorithmic logic, privacy policies, and other procedures used by search engines, social media platforms and other third party platforms; identifying the most effective and efficient level of spending in each marketplace, media and specific media vehicle; determining the appropriate creative message and media mix for advertising, marketing and promotional expenditures; managing marketing costs, including creative and media expenses, in order to maintain acceptable customer acquisition costs; differentiating our products as compared to other products; creating greater brand awareness; driving traffic to our websites, and websites of our retail partners and adapting our marketing tactics as e-commerce, search, and social networking evolve.
We must appropriately, effectively and efficiently allocate our marketing spend for multiple products and services, including: selecting the right marketplace, media and specific media vehicle in which to advertise; identifying the most effective and efficient level of spending in each marketplace, media and specific media vehicle; determining the appropriate creative message and media mix for advertising, marketing and promotional expenditures; managing marketing costs, including creative and media expenses, in order to maintain acceptable customer acquisition costs.
Risk Related to Our Industry Our estimate of the size of our addressable market may prove to be inaccurate.
Risks Related to Our Industry Our estimate of the size of our addressable market may prove to be inaccurate. Data for retail sales of dog products is collected for most, but not all channels.
See also "Cautionary Note Regarding Forward-Looking Statements.” 9 Table of Contents Risks Related to Our Strategy Our future operating performance is subject to numerous challenges and uncertainties. Our past operating performance may not be indicative of our future operating performance, which will depend on our ability to leverage our competitive strengths and execute on our strategy.
See also "Cautionary Note Regarding Forward-Looking Statements.” Risks Related to Our Strategy Our ability to execute our strategy depends on successfully navigating numerous challenges and uncertainties.
In particular, we intend to continue to invest substantial resources to grow and diversify our product offerings and in marketing to acquire new 20 Table of Contents customers.
In particular, we intend to continue to invest substantial resources to grow and diversify our product offerings and in marketing to acquire new customers. Our operating expenses may also be adversely impacted by increased costs and delays in launching in new markets and expanding fulfillment center capacity.
Wayfair, Inc. required us to collect sales tax in many jurisdictions despite our lack of a physical presence in such jurisdictions.
Wayfair, Inc. required us 19 Table of Contents to collect sales tax in many jurisdictions despite our lack of a physical presence in such jurisdictions. Also, the 2017 Tax Cuts and Jobs Act may limit our ability to use our substantial net operating losses to offset potential future taxable income.
Risks Related to our Manufacturing, Inventory and Supply Chain Our business critically relies on a limited number of suppliers, manufacturers, and logistics partners. We rely on a limited number of contract manufacturers, suppliers and logistics providers to manufacture and transport our products.
Continued or expanded tariffs, retaliatory trade measures, or supply chain disruptions resulting from trade tensions could materially and adversely affect our business, operating results, and financial condition. Risks Related to our Manufacturing, Inventory and Supply Chain Our business critically relies on a limited number of suppliers, manufacturers, and logistics partners.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn order to mitigate data or security incidents that may originate from third-party vendors or suppliers, we conduct both privacy and information security assessments to properly identify, prioritize, assess and remediate any third-party risks, and require information security and privacy addenda to our contracts where applicable.
Biggest changeIn order to mitigate data or security incidents that may originate from third-party vendors or suppliers, we conduct both privacy and information security assessments to properly identify, prioritize, assess and remediate any third-party risks, and require information security and privacy addenda to our contracts where applicable. 24 Table of Contents The nature of our business exposes us to cybersecurity threats and attacks that can lead to the unauthorized acquisition or access, compromise, loss, misuse or theft of our data, including personal information, confidential information or intellectual property.
Our current Director of Information Security has 16 years of industry experience leading large-scale security initiatives, enhancing infrastructure defenses and instilling a culture of security awareness across all employee levels. Additionally, our Director of Information Security holds standard industry security certifications, including CISSP (Certified Information Systems Security Professional).
Our current Director of Information Security has 17 years of industry experience leading large-scale security initiatives, enhancing infrastructure defenses and instilling a culture of security awareness across all employee levels. Additionally, our Director of Information Security holds standard industry security certifications, including CISSP (Certified Information Systems Security Professional).
To date risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected our business strategy, results of operations, or financial condition. See Part 1, Item 1A, Risk Factors , in this Annual Report on Form 10-K for a discussion of cybersecurity risks.
To date risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected, nor do we believe they are reasonably likely to materially affect, our business strategy, results of operations, or financial condition. See Part 1, Item 1A, Risk Factors , in this Annual Report on Form 10-K for a discussion of cybersecurity risks.
At the management level, a management steering committee comprised of our Chief Financial Officer, Controller, and General Counsel is briefed quarterly by our Director of Information Security.
Our Audit Committee’s responsibilities include reviewing the Company’s cybersecurity and other information technology risks, controls and procedures, including the Company’s plans to mitigate cybersecurity risks and to respond to data breaches. At the management level, a management steering committee comprised of our Chief Financial Officer, Controller, and General Counsel is briefed quarterly by our Director of Information Security.
Removed
The nature of our business exposes us to cybersecurity threats and attacks that can lead to the unauthorized acquisition or access, compromise, loss, misuse or theft of our data, including personal information, confidential information or intellectual property.
Removed
Our Audit Committee’s responsibilities include reviewing the 24 Table of Contents Company’s cybersecurity and other information technology risks, controls and procedures, including the Company’s plans to mitigate cybersecurity risks and to respond to data breaches.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table sets forth the location, use and size of certain of our properties as of May 31, 2024: Location Use Ownership Status Approximate Area in Square Feet New York, New York Office Space Leased 5,500 New York, New York Office Space Leased 51,220 New York, New York Photo Studio Leased 1,850 Columbus, Ohio Warehouse and distribution Center Leased 97,934 Columbus, Ohio Office Space Leased 34,238 Hebron, Kentucky Warehouse and distribution Center Leased 201,600 Las Vegas, Nevada Warehouse and distribution Center Leased 400,593
Biggest changeThe following table sets forth the location, use and size of certain of our properties as of March 31, 2025: 25 Table of Contents Location Use Ownership Status Approximate Area in Square Feet New York, New York Office Space Leased 5,500 New York, New York Office Space Leased 51,220 Columbus, Ohio Warehouse and distribution Center Leased 97,934 Columbus, Ohio Office Space Leased 34,238 Hebron, Kentucky Warehouse and distribution Center Leased 201,600 Las Vegas, Nevada Warehouse and distribution Center Leased 400,593

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe complaint is brought against (a) certain officers and directors of Northern Star Acquisition Corp. at the time of its proposed acquisition of Legacy BARK, (b) Northern Star Sponsor, LLC, and (c) two of the founders of Legacy BARK.
Biggest changeThe operative complaint is brought against (a) certain officers and directors of Northern Star Acquisition Corp. at the time of its proposed acquisition of Legacy BARK, (b) Northern Star Sponsor, LLC, (c) two of the founders of Legacy BARK, and (d) Barkbox, Inc. and Bark, Inc.
ITEM 3. LEGAL PROCEEDINGS 25 Table of Contents On March 20, 2024, three alleged shareholders filed a putative class action complaint in the lawsuit styled Kenville v. Northern Star Sponsor LLC, et al., Case No. 2024-276, which is pending in the Delaware Court of Chancery.
ITEM 3. LEGAL PROCEEDINGS On March 20, 2024, three alleged shareholders filed a putative class action complaint in the lawsuit styled Kenville v. Northern Star Sponsor LLC, et al., Case No. 2024-276, which is pending in the Delaware Court of Chancery.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeFinancial Statements and Supplementary Data 49 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 35 Item 9A. Controls and Procedures 36 Item 9B. Other Information 36
Biggest changeFinancial Statements and Supplementary Data 49 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 36 Item 9A. Controls and Procedures 37 Item 9B. Other Information 37

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeA summary of our repurchases of common stock is as follows: Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value that May Yet be Purchased Under the Plans or Programs (in thousands) January 1-31, 2024 — $— — $— February 1-29, 2024 1,575,905 1.12 1,575,905 1,587 March 1-31, 2024 — — — — Total 1,575,905 $1.12 1,575,905 $1,587 27 Table of Contents Performance Graph The graph below compares the cumulative total stockholder return on our common stock with the cumulative total return on the Standard & Poor’s (“S&P”) 500 index and the S&P Retail Internet Select Industry index.
Biggest changeThe Company’s stock repurchase programs may be limited or terminated at any time without prior notice. 27 Table of Contents Performance Graph The graph below compares the cumulative total stockholder return on our common stock with the cumulative total return on the Standard & Poor’s (“S&P”) 500 index and the S&P Retail Internet Select Industry index.
The graph assumes an initial investment of $100 in our common stock at the market close on December 18, 2020, which was the first day on which our common stock commenced trading on its own through March 31, 2024 the last business day of our fiscal year.
The graph assumes an initial investment of $100 in our common stock at the market close on December 18, 2020, which was the first day on which our common stock commenced trading on its own through March 31, 2025 the last business day of our fiscal year.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information Our common stock and warrants to purchase common stock are traded on the New York Stock Exchange under the symbols “BARK” and “BARK WS,” respectively. Holders As of May 29, 2024 there were approximately 104 stockholders of record.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information Our common stock and warrants to purchase common stock are traded on the New York Stock Exchange under the symbols “BARK” and “BARK WS,” respectively. Holders As of May 29, 2025 there were approximately 78 stockholders of record.
Recent Sales of Unregistered Securities and Use of Proceeds None. Issuer Purchases of Equity Securities During the three months ended March 31, 2024, we repurchased $1.8 million of common stock, or approximately 1.6 million shares, under our repurchase program. As a result, $1.6 million remained available under the current authorization.
Recent Sales of Unregistered Securities and Use of Proceeds None. Issuer Purchases of Equity Securities During the three months ended March 31, 2025, we repurchased $10.5 million of common stock, or approximately 6.1 million shares, under our repurchase program. As a result, $1.8 million remained available under the current authorization.
Data for the S&P 500 and the S&P Retail Internet Select Industry index assume reinvestment of dividends. Total return equals stock price appreciation plus reinvestment of dividends. The stock price performance of the graph above is not necessarily indicative of future stock price performance.
Data for the S&P 500 and the S&P Consumer Discretionary Select index assume reinvestment of dividends. Total return equals stock price appreciation plus reinvestment of dividends. The stock price performance of the graph above is not necessarily indicative of future stock price performance.
Added
A summary of our repurchases of common stock for the three months ended March 31, 2025 is as follows: Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands) January 1-31, 2025 1,517,140 $1.98 1,517,140 $5,252 February 1-28, 2025 1,947,654 1.85 1,947,654 5,651 March 1-31, 2025 2,658,684 1.46 2,658,684 1,775 Total 6,123,478 $1.71 6,123,478 $1,775 (1) On August 17, 2023, June 3, 2024, and February 26, 2025 the Company respectively announced that its Board of Directors had authorized a stock repurchase program, pursuant to which the Company may repurchase, from time to time, up to an aggregate of $7.5 million, $15.0 million, and $4.0 million respectively, or $26.5 million in total, of BARK’s outstanding shares of common stock, exclusive of any fees, commissions or other expenses related to such repurchases, in open market transactions made in accordance with the provisions of Rule 10b-18 and/or Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, privately negotiated transactions or by other means in accordance with applicable securities laws.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFiscal Year Ended March 31, 2024 2023 2022 2024 vs 2023 2023 vs 2022 (in thousands) Consolidated Statement of Operation Data: Revenue Direct to Consumer $ 436,446 $ 471,994 $ 448,074 (7.5) % 5.3 % Commerce 53,738 63,321 59,332 (15.1) % 6.7 % Total revenue 490,184 535,315 507,406 (8.4) % 5.5 % Cost of revenue Direct to Consumer 157,578 186,666 187,991 (15.6) % (0.7) % Commerce 30,454 40,534 37,309 (24.9) % 8.6 % Total cost of revenue 188,032 227,200 225,300 (17.2) % 0.8 % Gross profit 302,152 308,115 282,106 (1.9) % 9.2 % Operating expenses: Advertising and marketing 79,282 68,807 74,417 15.2 % (7.5) % General and administrative 268,390 303,139 301,870 (11.5) % 0.4 % Total operating expenses 347,672 371,946 376,287 (6.5) % (1.2) % Loss from operations (45,520) (63,831) (94,181) (28.7) % (32.2) % Interest income 7,533 1,056 — 613.4 % N/M Interest expense (4,351) (5,428) (5,464) (19.8) % (0.7) % Other income, net 5,328 6,684 31,346 (20.3) % (78.7) % Net loss before income taxes (37,010) (61,519) (68,299) (39.8) % (9.9) % Provision for income taxes — — — 0.0 % 0.0 % Net loss $ (37,010) $ (61,519) $ (68,299) (39.8) % (9.9) % N/M means not meaningful. 33 Table of Contents Comparison of the Fiscal Years Ended March 31, 2024 and March 31, 2023 Revenue Fiscal Year Ended March 31, 2024 2023 $ Change % Change ( in thousands) Revenue Direct to Consumer 436,446 471,994 (35,548) (7.5) % Commerce 53,738 63,321 (9,583) (15.1) % Total revenue $ 490,184 $ 535,315 $ (45,131) (8.4) % Percentage of Revenue Direct to Consumer 89.0 % 88.2 % Commerce 11.0 % 11.8 % Direct to Consumer revenue decreased by $35.5 million, or 7.5% , for the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31, 2023.
Biggest changeFiscal Year Ended March 31, 2025 2024 2023 2025 vs 2024 2024 vs 2023 (in thousands) Consolidated Statement of Operation Data: Revenue Direct to Consumer $ 415,837 $ 436,446 $ 471,994 (4.7) % (7.5) % Commerce 68,345 53,738 63,321 27.2 % (15.1) % Total revenue 484,182 490,184 535,315 (1.2) % (8.4) % Cost of revenue Direct to Consumer 145,011 157,578 186,666 (8.0) % (15.6) % Commerce 37,183 30,454 40,534 22.1 % (24.9) % Total cost of revenue 182,194 188,032 227,200 (3.1) % (17.2) % Gross profit 301,988 302,152 308,115 (0.1) % (1.9) % Operating expenses: Advertising and marketing 83,756 79,282 68,807 5.6 % 15.2 % General and administrative 253,380 268,390 303,139 (5.6) % (11.5) % Total operating expenses 337,136 347,672 371,946 (3.0) % (6.5) % Loss from operations (35,148) (45,520) (63,831) (22.8) % (28.7) % Interest income 4,926 7,533 1,056 (34.6) % N/M Interest expense (2,788) (4,351) (5,428) (35.9) % (19.8) % Other income, net 132 5,328 6,684 (97.5) % (20.3) % Net loss before income taxes (32,878) (37,010) (61,519) (11.2) % (39.8) % Provision for income taxes — — — 0.0 % 0.0 % Net loss $ (32,878) $ (37,010) $ (61,519) (11.2) % (39.8) % N/M means not meaningful. 34 Table of Contents Comparison of the Fiscal Years Ended March 31, 2025 and March 31, 2024 Revenue Fiscal Year Ended March 31, 2025 2024 $ Change % Change ( in thousands) Revenue Direct to Consumer 415,837 436,446 (20,609) (4.7) % Commerce 68,345 53,738 14,607 27.2 % Total revenue $ 484,182 $ 490,184 $ (6,002) (1.2) % Percentage of Revenue Direct to Consumer 85.9 % 89.0 % Commerce 14.1 % 11.0 % Direct to Consumer revenue decreased by $20.6 million, or 4.7% , for the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024.
The increase in gross margin is primarily attributable to lower inbound freight and product cost improvements. 34 Table of Contents Operating Expenses General and Administrative Expense Fiscal Year Ended March 31, 2024 2023 $ Change % Change ( in thousands) Other general and administrative 128,576 146,135 (17,559) (12.0) % Shipping and fulfillment 139,814 157,004 (17,190) (10.9) % Total General and administrative $ 268,390 $ 303,139 $ (34,749) (11.5) % Percentage of revenue 54.8 % 56.6 % General and administrative expense decreased by $34.7 million, or 11.5%, f or the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31, 2023.
The increase in gross margin is primarily attributable to lower inbound freight and product cost improvements. 38 Table of Contents Operating Expenses General and Administrative Expense Fiscal Year Ended March 31, 2024 2023 $ Change % Change ( in thousands) Other general and administrative 128,576 146,135 (17,559) (12.0) % Shipping and fulfillment 139,814 157,004 (17,190) (10.9) % Total General and administrative $ 268,390 $ 303,139 $ (34,749) (11.5) % Percentage of revenue 54.8 % 56.6 % General and administrative expense decreased by $34.7 million, or 11.5%, f or the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31, 2023.
If a Change of Control (as defined in the Indenture) of the Company occurs at any time after the date of the Agreement and prior to the December 1, 2025 maturity date of the Notes, the Holders are also entitled to receive an additional cash “true-up” payment from the Company, totaling, in the aggregate for all Holders, either (i) $11.3 million in the case that the Company elects to redeem all of the Notes outstanding at the time of such Change of Control or (ii) $4.5 million in the case that the Holders elect to require the Company to repurchase all of the 2025 Convertible Notes outstanding at the time of such Change of Control any other case, in each case, in accordance with the terms and conditions specified in the Agreement.
If a Change of Control (as defined in the Indenture) of the Company occurs at any time after the date of the Agreement and prior to the December 1, 2025 maturity date of the Notes, the Holders are also entitled to receive an additional cash “true-up” payment from the Company, totaling, in the aggregate for all Holders, either (i) $11.3 million in the case that the Company elects to redeem all of the Notes outstanding at the time of such Change of Control or (ii) $4.5 million in the case that the Holders elect to require the Company to repurchase all of the 2025 Convertible Notes outstanding at the time of such Change of Control, in each case, in accordance with the terms and conditions specified in the Agreement.
Deferred revenue is recognized as revenue upon the delivery of the box or product. Inventories Inventories consist principally of finished goods, and represent products available for sale and are accounted for using the first-in, first-out (“FIFO”) method and valued at the lower of cost or net realizable value. Inventory costs consist of product and inbound shipping and handling costs.
Deferred revenue is recognized as revenue upon the delivery of the box or product. Inventories Inventories consist principally of finished goods, and represent products available for sale and are accounted for using the first-in, first-out (“FIFO”) method and valued at the lower of cost or net realizable value. Inventory costs consist of product, duties and inbound shipping and handling costs.
Additionally, as a result of our cost cutting initiatives announced in February of fiscal year 2023 and July of fiscal year 2024, compensation expense decreased $8.7 million due to a decrease in headcount, and consulting and legal fees decreased of $5.1 million.
Additionally, as a result of our cost cutting initiatives announced in February of fiscal year 2023 and July of fiscal year 2024, compensation expense decreased $8.7 million due to a decrease in headcount, and consulting and legal fees decreased by $5.1 million.
This increase is due to the interest earned on our money market account and interest-bearing checking accounts. 35 Table of Contents Interest Expense Fiscal Year Ended March 31, 2024 2023 $ Change % Change ( in thousands) Interest expense $ (4,351) $ (5,428) $ 1,077 (19.8) % Percentage of revenue (0.9) % (1.0) % Interest expense decreased by $1.1 million, or 19.8% , for the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31, 2023.
This increase is due to the interest earned on our money market account and interest-bearing checking accounts. 39 Table of Contents Interest Expense Fiscal Year Ended March 31, 2024 2023 $ Change % Change ( in thousands) Interest expense $ (4,351) $ (5,428) $ 1,077 (19.8) % Percentage of revenue (0.9) % (1.0) % Interest expense decreased by $1.1 million, or 19.8% , for the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31, 2023.
We review current business trends and forecasts, and inventory aging to determine adjustments which we estimate will be needed to liquidate existing excess inventories and record inventories at either the lower of cost or net realizable value or the lower of cost or market, as applicable. We believe that all inventory write-downs required at March 31, 2024, have been recorded.
We review current business trends and forecasts, and inventory aging to determine adjustments which we estimate will be needed to liquidate existing excess inventories and record inventories at either the lower of cost or net realizable value or the lower of cost or market, as applicable. We believe that all inventory write-downs required at March 31, 2025, have been recorded.
Because of these limitations, when evaluating our performance, you should consider the Non-GAAP Measures alongside other financial measures, including our net loss and other results stated in accordance with U.S. GAAP. 40 Table of Contents The following table presents a reconciliation of Adjusted net loss to net loss, the most directly comparable financial measure stated in accordance with U.S.
Because of these limitations, when evaluating our performance, you should consider the Non-GAAP Measures alongside other financial measures, including our net loss and other results stated in accordance with U.S. GAAP. 41 Table of Contents The following table presents a reconciliation of Adjusted net loss to net loss, the most directly comparable financial measure stated in accordance with U.S.
We are required to comply with certain financial and non-financial covenants related to our borrowing agreements, which we are in compliance with as of March 31, 2024 and expect to be in compliance with during the next 12 months. Our material cash requirements include our lease arrangements for corporate offices, warehouses and certain equipment.
We are required to comply with certain financial and non-financial covenants related to our borrowing agreements, which we are in compliance with as of March 31, 2025 and expect to be in compliance with during the next 12 months. Our material cash requirements include our lease arrangements for corporate offices, warehouses and certain equipment.
Other Income, Net Other income, net, primarily consists of changes in the fair value of our warrant liabilities and loss on extinguishment of debt. 32 Table of Contents Results of Operations We operate in two reportable segments to reflect the way our CODM reviews and assesses the performance of the business.
Other Income, Net Other income, net, primarily consists of changes in the fair value of our warrant liabilities and loss on extinguishment of debt. 33 Table of Contents Results of Operations We operate in two reportable segments to reflect the way our CODM reviews and assesses the performance of the business.
See Note 2, “Summary of Significant Accounting Policies,” in our audited consolidated financial statements for the fiscal years ended March 31, 2024, 2023, and 2022 included elsewhere in this Annual Report on Form 10-K.
See Note 2, “Summary of Significant Accounting Policies,” in our audited consolidated financial statements for the fiscal years ended March 31, 2025, 2024, and 2023 included elsewhere in this Annual Report on Form 10-K.
As of March 31, 2024, the effective interest rate is 6.60%. The accrued interest of $2.1 million and $4.4 million was paid-in-kind through an increase of the outstanding principal on the 2025 Convertible Notes on December 1, 2023 and 2022, respectively.
As of March 31, 2025, the effective interest rate is 6.60%. The accrued interest of $2.2 million and $2.1 million was paid-in-kind through an increase of the outstanding principal on the 2025 Convertible Notes on December 1, 2024 and 2023, respectively.
Management determined that the probability that the contingent events will occur was near zero at inception and has remained near zero as of March 31, 2024. Therefore, the Company did not record a derivative liability related to these features as of March 31, 2024.
Management determined that the probability that the contingent events will occur was near zero at inception and has remained near zero as of March 31, 2025. Therefore, the Company did not record a derivative liability related to these features as of March 31, 2025.
These key financial and operating metrics should be read in conjunction with the following discussion of our results of operations and financial condition together with our consolidated financial statements and the related notes and other financial information included elsewhere in this Annual Report on Form 10-K may not be comparable to similarly titled performance indicators used by other companies.
These key financial and operating metrics should be read in conjunction with the following discussion of our results of operations and financial condition together with our consolidated financial statements and the related notes and 30 Table of Contents other financial information included elsewhere in this Annual Report on Form 10-K may not be comparable to similarly titled performance indicators used by other companies.
The audited consolidated financial statements as of March 31, 2024 and 2023 and for the fiscal years ended March 31, 2024, 2023 and 2022, respectively, present the financial position and results of operations and cash flows of BARK, Inc. and its wholly-owned subsidiaries.
The audited consolidated financial statements as of March 31, 2025 and 2024 and for the fiscal years ended March 31, 2025, 2024 and 2023, respectively, present the financial position and results of operations and cash flows of BARK, Inc. and its wholly-owned subsidiaries.
The non-cash charges primarily consisted of $14.8 million for stock based compensation, $9.4 million for depreciation and amortization, and $4.9 million of non-cash lease expense. The increase in our net operating assets and liabilities was driven by a reduction in inventory of $33.5 million and proceeds from tenant improvement allowances of $7.4 million.
The non-cash charges primarily consisted of $14.8 million for stock based compensation, $9.4 million for depreciation and amortization, and $4.9 million of non-cash lease expense. The increase in our net operating assets and liabilities was 46 Table of Contents driven by a reduction in inventory of $33.5 million and proceeds from tenant improvement allowances of $7.4 million.
Recent Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 — Summary of Significant Accounting Policies in our audited consolidated financial statements contained in this Annual Report on Form 10-K.
Recent Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 — Summary of Significant Accounting Policies in our audited consolidated financial statements contained in this Annual Report on Form 10-K. 48 Table of Contents
Cash flows provided by (used in) Financing Activities For the fiscal year ended March 31, 2024, net cash used in financing activities was $49.6 million, primarily due to the partial payment of long-term debt of $42.3 million and payments to repurchase common stock of $6.2 million.
For the fiscal year ended March 31, 2024, net cash used in financing activities was $49.6 million, primarily due to the partial payment of long-term debt of $42.3 million and payments to repurchase common stock of $6.2 million.
The recognition of revenue is determined through application of the following five-step model: • Identification of the contract(s) with customers, as applicable; • Identification of the performance obligation(s) in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligation(s) in the contract; and • Recognition of revenue when or as the performance obligation(s) is satisfied.
The recognition of revenue is determined through application of the following five-step model: • Identification of the contract(s) with customers, as applicable; 47 Table of Contents • Identification of the performance obligation(s) in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligation(s) in the contract; and • Recognition of revenue when or as the performance obligation(s) is satisfied.
The fair value calculation includes Level 3 inputs including the estimated fair value of the 43 Table of Contents Company’s common stock and assumptions regarding the probability that the contingent call or put will be exercised or an event of default will occur.
The fair value calculation includes Level 3 inputs including the estimated fair value of the Company’s common stock and assumptions regarding the probability that the contingent call or put will be exercised or an event of default will occur.
Revenue Recognition 46 Table of Contents Our primary sources of revenue are from sales of toys and accessories and consumables through our Direct to Consumer and Commerce segments. We recognize revenue upon delivery of products and services to our customer, as applicable.
Revenue Recognition Our primary sources of revenue are from sales of toys & accessories and consumables through our Direct to Consumer and Commerce segments. We recognize revenue upon delivery of products and services to our customer, as applicable.
Since our founding in 2011, we have happily served millions of dogs and their people. We are a vertically integrated, omnichannel brand serving dogs across two key categories: toys & accessories and consumables. All of our products are designed, developed, and branded by BARK.
Since our founding in 2011, we have happily served millions of dogs and their people. We are an omnichannel brand serving dogs across two key categories: toys & accessories and consumables. All of our products are designed, developed, and branded by BARK.
For the fiscal year ended March 31, 2023, and 2022, net cash used in investing activities was $21.1 million and $21.2 million, respectively , primarily due to capital expenditures for warehouse machinery, leasehold improvements, equipment, and software implementations.
For the fiscal year ended March 31, 2024, and 2023, net cash used in investing activities was $8.8 million and $21.1 million, respectively , primarily due to capital expenditures for warehouse machinery, leasehold improvements, equipment, and software implementations.
General and Administrative General and administrative expenses consists primarily of compensation and benefit expenses, including stock-based compensation, fulfillment and shipping costs, which represent costs incurred in operating and staffing fulfillment and customer service centers, including costs attributable to receiving, inspecting, picking, packaging and preparing customer orders for shipment, outbound freight costs associated with shipping orders to customers, and responding to inquiries from customers.
Operating Expenses Operating expenses consist of general and administrative and advertising and marketing expenses. 32 Table of Contents General and Administrative General and administrative expenses consists primarily of compensation and benefit expenses, including stock-based compensation, fulfillment and shipping costs, which represent costs incurred in operating and staffing fulfillment and customer service centers, including costs attributable to receiving, inspecting, picking, packaging and preparing customer orders for shipment, outbound freight costs associated with shipping orders to customers, and responding to inquiries from customers.
As of March 31, 2024, we had fixed lease payment obligations of $47.9 million, with $5.3 million payable within 12 months. 2025 Convertible Notes On November 27, 2020, the Company issued $75.0 million aggregate principal amount of 2025 Convertible Notes (the “2025 Convertible Notes”) to Magnetar Capital, LLC (“Magnetar”) under an indenture, dated as of November 27, 2020, between Legacy BARK and U.S.
As of March 31, 2025, we had fixed lease payment obligations of $42.6 million, with $5.8 million payable within 12 months. 2025 Convertible Notes On November 27, 2020, the Company issued $75.0 million aggregate principal amount of 2025 Convertible Notes (the “2025 Convertible Notes”) to Magnetar Capital, LLC (“Magnetar”) under an indenture, dated as of November 27, 2020, between Legacy BARK and U.S.
We leverage an ever-growing collection of first-party data, customer insights, and machine learning to deliver personalized products and experiences tailored to the needs of each and every dog we serve. Our products are sold direct-to-consumer (“DTC”) and through our network of retail partners, which currently spans over 40,000 doors nationwide.
We leverage an ever-growing collection of first-party data, customer insights, and machine learning to deliver personalized products and experiences tailored to the needs of each and every dog we serve. Our products are sold direct-to-consumer (“DTC”) and through our network of retail partners, which currently spans over 50,000 doors nationwide and online marketplaces including Amazon and Chewy.
If market conditions were to change, including as a result of the current war in the Ukraine and its broader macroeconomic implications or the COVID-19 pandemic and the supply chain and logistics disruptions globally, it is possible that the required level of inventory reserves may need to be adjusted.
If market conditions were to change, including as a result of the current war in the Ukraine and its broader macroeconomic implications or the COVID-19 pandemic and the supply chain, logistics disruptions globally, and potential changes to trade policy, including the imposition of new or increased tariffs it is possible that the required level of inventory reserves may need to be adjusted.
As of March 31, 2024 and March 31, 2023, the Company had $40.6 million and $83.5 million, respectively, of outstanding borrowings under the note purchase agreement governing the purchase and sale of the 2025 Convertible Notes agreement.
As of March 31, 2025 and March 31, 2024, the Company had $42.9 million and $40.6 million, respectively, of outstanding borrowings under the note purchase agreement governing the purchase and sale of the 2025 Convertible Notes agreement.
On November 2, 2023, the Company repurchased $45.0 million of the $83.5 million of outstanding aggregate principal amount of 5.50% Convertible Secured Notes due 2025 (the “2025 Convertible Notes”) from entities affiliated with Magnetar Financial, LLC (collectively, the “Holders”), pursuant to the terms and conditions of a negotiated notes purchase agreement (the “Agreement”) among the Company and the Holders.
The Company will assess the probability of occurrence quarterly during the term of the 2025 Convertible Notes. 44 Table of Contents On November 2, 2023, the Company repurchased $45.0 million of the $83.5 million of outstanding aggregate principal amount of 5.50% Convertible Secured Notes due 2025 (the “2025 Convertible Notes”) from entities affiliated with Magnetar Financial, LLC (collectively, the “Holders”), pursuant to the terms and conditions of a negotiated notes purchase agreement (the “Agreement”) among the Company and the Holders.
Factors Affecting Our Performance We believe that our performance and future success depend on several factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section of this Annual Report on Form 10-K titled “ Risk Factors .” Investments in growth Our ability to increase the number of total orders and cross category purchasing is a key factor in our future growth and will be driven by our marketing and from the development of new products, primarily in the consumables space.
Factors Affecting Our Performance We believe that our performance and future success depend on several factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section of this Annual Report on Form 10-K titled “ Risk Factors .” Investments in growth Our ability to increase the number of customers. total orders, and cross category purchasing is a key factor in our future DTC growth and will be driven by our marketing efforts and ability to continue to expand within the toys and consumables categories.
The following table summarizes our cash flows for the fiscal years ended March 31, 2024, 2023 and 2022: Fiscal Year Ended March 31 2024 2023 2022 (in thousands) Net cash provided by (used in) operating activities $ 6,060 $ 4,694 $ (172,338) Net cash used in investing activities (8,831) (21,145) (21,172) Net cash provided by (used in) financing activities (49,615) (2,099) 355,458 Effect of exchange rate changes on cash 24 (62) — Net increase (decrease) in cash and restricted cash $ (52,362) $ (18,612) $ 161,948 Cash flows provided by (used in) Operating Activities Net cash flows in operating activities represent the cash receipts and disbursements related to our activities other than investing and financing activities.
The following table summarizes our cash flows for the fiscal years ended March 31, 2025, 2024 and 2023: Fiscal Year Ended March 31 2025 2024 2023 (in thousands) Net cash provided by (used in) operating activities $ (7,079) $ 6,060 $ 4,694 Net cash used in investing activities (6,157) (8,831) (21,145) Net cash provided by (used in) financing activities (19,870) (49,615) (2,099) Effect of exchange rate changes on cash (69) 24 (62) Net increase (decrease) in cash and restricted cash $ (33,174) $ (52,362) $ (18,612) Cash flows provided by (used in) Operating Activities Net cash flows in operating activities represent the cash receipts and disbursements related to our activities other than investing and financing activities.
The Credit Facility also contains affirmative and negative covenants customary for financings of this type, including, among other things, limitations or prohibitions on repurchasing common shares, declaring and paying dividends and other distributions, making payments in respect of subordinated debt or our 2025 Convertible Notes, incurring indebtedness, making loans and investments, incurring liens, or entering into mergers, asset sales and transactions with affiliates. 44 Table of Contents As of March 31, 2024 and March 31, 2023, there were no outstanding borrowings under the Credit Facility.
The Credit Facility also contains affirmative and negative covenants customary for financings of this type, including, among other things, limitations or prohibitions on repurchasing common shares, declaring and paying dividends and other distributions, making payments in respect of subordinated debt or our 2025 Convertible Notes, incurring indebtedness, making loans and investments, incurring liens, or entering into mergers, asset sales and transactions with affiliates.
As a result, we expect to continue to focus on long-term growth through investments in product offerings and the dog and dog parent experience. We are working to enhance our offerings and expand the breadth of the products and offerings especially in consumables.
As a result, we expect to continue to focus on long-term growth through investments in product offerings and the dog and dog parent experience. We are working to enhance our offerings and expand the 29 Table of Contents breadth of the products and offerings especially in consumables. We expect to make additional investments in marketing to acquire new DTC customers.
GAAP, for each of the periods indicated: Free Cash Flow Fiscal Year Ended March 31 2024 2023 2022 Free cash flow reconciliation: Net cash provided by (used in) operating activities $ 6,060 $ 4,694 $ (172,338) Capital expenditures (8,831) (21,320) (21,172) Free cash flow $ (2,771) $ (16,626) $ (193,510) Liquidity and Capital Resources As of March 31, 2024, we had cash and cash equivalents of approximately $125.5 million.
GAAP, for each of the periods indicated: Free Cash Flow Fiscal Year Ended March 31 2025 2024 2023 Free cash flow reconciliation: Net cash provided by (used in) operating activities $ (7,079) $ 6,060 $ 4,694 Capital expenditures (6,157) (8,831) (21,320) Free cash flow $ (13,236) $ (2,771) $ (16,626) Liquidity and Capital Resources As of March 31, 2025, we had cash and cash equivalents of approximately $94.0 million.
Interested parties can book flights at dogsflyfirst.com. Our charter partner is responsible for all aircraft, crew, maintenance, and insurance, allowing BARK to focus on creating a great travel experience for dogs and their people worldwide. We believe this initiative exemplifies the Company’s dog-first approach to curating the best products and services.
Our charter partners are responsible for all aircraft, pilots, maintenance, and insurance, allowing BARK to focus on creating a great travel experience for dogs and their people worldwide. We believe this initiative exemplifies the Company’s dog-first approach to curating the best products and services.
We believe that these costs are discrete and non-recurring in nature, as they relate to a one-time unification of our product offerings on our new commerce platform.
We believe that these costs are discrete and non-recurring in nature, as they relate to a one-time unification of our product offerings on our new commerce platform. As such, they are not normal, recurring operating expenses and are not reflective of ongoing trends in the cost of doing business.
Cash flows used in Investing Activities For the fiscal year ended March 31, 2024, net cash used in investing activities was $8.8 million, primarily due to capital expenditures for software implementations and other capital expenditures.
Cash flows used in Investing Activities For the fiscal year ended March 31, 2025, net cash used in investing activities was $6.2 million, primarily due to capital expenditures for warehouse equipment and software implementation.
We expect to make additional investments in marketing to acquire new customers. 29 Table of Contents Expansion of new offerings Another key factor in our future performance is our ability to increase our average order value (“AOV”), which involves introducing new products into our portfolio.
Expansion of new offerings Another key factor in our future performance is our ability to increase our average order value (“AOV”), which involves introducing new products into our portfolio.
The results of these estimates form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
Western Alliance Bank—Line of Credit and Term Loan In October 2017, the Company entered into a loan and security agreement and issued a warrant to purchase preferred stock (“Initial Western Alliance Warrant”) to Western Alliance Bank (“Western Alliance”), which provides for a revolving line of credit (as amended, the “Credit Facility”) in an aggregate principal amount of up to $35.0 million, subject to borrowing base limitations derived from advance rates derived from the Company’s eligible subscription revenues and eligible accounts receivable.
Western Alliance Bank—Line of Credit and Term Loan In October 2017, the Company entered into a loan and security agreement and issued a warrant to purchase preferred stock (“Initial Western Alliance Warrant”) to Western Alliance Bank (“Western Alliance”), which provides for a revolving line of credit (as amended, the “Credit Facility”) in an aggregate principal amount of up to $35.0 million, including a $10.0 million sublimit for letters of credit of which $9.2 million has been issued.
GAAP, and the calculation of net loss margin, Adjusted net loss margin and Adjusted net loss per common share for the periods presented: Adjusted Net Loss Fiscal Year Ended March 31, 2024 2023 2022 Net loss $ (37,010) $ (61,519) $ (68,299) Stock-based compensation expense 12,931 14,811 17,861 Change in fair value of warrants and derivatives (2,738) (5,350) (33,196) Sales and use tax (income) expense (1) (487) (365) 648 Restructuring 1,660 1,763 86 (Gain) loss on extinguishment of debt (1,828) — 2,024 Duplicate headquarters rent 93 1,747 — Impairment of assets (2) 3,079 2,065 — Transaction costs (3) — — 6,053 Demurrage fees (4) — — 2,610 Technology transformation (5) 684 — — Other Items (6) 3,594 1,784 4,544 Adjusted net loss $ (20,022) $ (45,064) $ (67,669) Net loss margin (7.55) % (11.49) % (13.46) % Adjusted net loss margin (4.08) % (8.42) % (13.34) % Adjusted net loss per common share - basic and diluted $ (0.11) $ (0.26) $ (0.43) Weighted average common shares used to compute adjusted net loss per share attributable to common stockholders - basic and diluted 177,260,581 176,717,509 156,201,601 41 Table of Contents The following table presents a reconciliation of Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with U.S.
GAAP, and the calculation of net loss margin, Adjusted net loss margin and Adjusted net loss per common share for the periods presented: Adjusted Net Loss Fiscal Year Ended March 31, 2025 2024 2023 Net loss $ (32,878) $ (37,010) $ (61,519) Stock-based compensation expense 12,735 12,931 14,811 Change in fair value of warrants and derivatives 521 (2,738) (5,350) Sales and use tax income (1) (2,417) (487) (365) Restructuring 3,829 1,660 1,763 Gain on extinguishment of debt — (1,828) — Litigation expenses (2) 1,839 175 — Warehouse restructuring costs 4,738 814 — Impairment of assets 3,599 3,079 2,065 Technology modernization (3) 2,400 684 — Other items (4) 1,316 2,698 3,531 Adjusted net loss $ (4,318) $ (20,022) $ (45,064) Net loss margin (6.79) % (7.55) % (11.49) % Adjusted net loss margin (0.89) % (4.08) % (8.42) % Adjusted net loss per common share - basic and diluted $ (0.02) $ (0.11) $ (0.26) Weighted average common shares used to compute adjusted net loss per share attributable to common stockholders - basic and diluted 174,399,565 177,260,581 176,717,509 42 Table of Contents The following table presents a reconciliation of Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with U.S.
The preparation of these financial statements requires us to make estimate and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities.
The preparation of these financial statements requires us to make estimate and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. We also make estimates and assumptions on revenue generated and reported expenses incurred during the reporting periods.
GAAP, and the calculation of net loss margin and Adjusted EBITDA margin for the periods presented: Adjusted EBITDA Fiscal Year Ended March 31 2024 2023 2022 (in thousands) Net loss $ (37,010) $ (61,519) $ (68,299) Interest income (7,533) (1,056) — Interest expense 4,351 5,428 5,464 Depreciation and amortization expense 12,602 9,427 4,403 Stock-based compensation expense 12,931 14,811 17,861 Change in fair value of warrants and derivatives (2,738) (5,350) (33,196) Sales and use tax (income) expense (1) (487) (365) 648 Restructuring 1,660 1,763 86 (Gain) loss on extinguishment of debt (1,828) — 2,024 Duplicate headquarters rent 93 1,747 — Impairment of assets (2) 3,079 2,065 — Transaction costs (3) — — 6,053 Demurrage fees (4) — — 2,610 Technology transformation (5) 684 — — Other items (6) 3,594 1,784 4,544 Adjusted EBITDA $ (10,602) $ (31,265) $ (57,802) Net loss margin (7.55) % (11.49) % (13.46) % Adjusted EBITDA margin (2.16) % (5.84) % (11.39) % (1) Sales and use tax (income) expense relates to recording a liability for sales and use tax we did not collect from our customers.
GAAP, and the calculation of net loss margin and Adjusted EBITDA margin for the periods presented: Adjusted EBITDA Fiscal Year Ended March 31 2025 2024 2023 (in thousands) Net loss $ (32,878) $ (37,010) $ (61,519) Interest income (4,926) (7,533) (1,056) Interest expense 2,788 4,351 5,428 Depreciation and amortization expense 11,222 12,602 9,427 Stock-based compensation expense 12,735 12,931 14,811 Change in fair value of warrants and derivatives 521 (2,738) (5,350) Cloud computing amortization 594 — — Sales and use tax income (1) (2,417) (487) (365) Restructuring 3,829 1,660 1,763 Gain on extinguishment of debt — (1,828) — Litigation expenses (2) 1,839 175 — Warehouse restructuring costs 4,738 814 — Impairment of assets 3,599 3,079 2,065 Technology modernization (3) 2,400 684 — Other items (4) 1,316 2,698 3,531 Adjusted EBITDA $ 5,360 $ (10,602) $ (31,265) Net loss margin (6.79) % (7.55) % (11.49) % Adjusted EBITDA margin 1.11 % (2.16) % (5.84) % (1) Sales and use tax (income) expense relates to recording a liability for sales and use tax we did not collect from our customers.
For the fiscal year ended March 31, 2022, net cash used in operating activities was $172.3 million. The $172.3 million of net cash used in operating activities consisted of net loss of $68.3 million adjusted for non-cash charges totaling $7.6 million and a net decrease of $111.6 million in our net operating assets and liabilities.
For the fiscal year ended March 31, 2025, net cash used in operating activities was $7.1 million. The $7.1 million of net cash used in by operating activities consisted of net loss of $32.9 million adjusted for non-cash charges totaling $36.9 million and a ne t increase of $11.1 million in our net operating assets and liabilities.
We calculate Adjusted EBITDA as net loss, adjusted to exclude: (1) interest income, (2) interest expense (3) depreciation and amortization expense, (4) stock-based compensation expense, (5) change in fair value of warrants and derivatives, (6) sales and use tax (income) expense, (7) restructuring charges related to reduction in force 39 Table of Contents payments, (8) (gain) loss on extinguishment of debt, (9) duplicate rent expense incurred during the relocation of our corporate headquarters, (10) impairment of assets (11) transaction costs (12) demurrage fees related to freight, (13) technology transformation and (14) other items (as defined below).
We calculate Adjusted EBITDA as net loss, adjusted to exclude: (1) interest income, (2) interest expense (3) depreciation and amortization expense, (4) stock-based compensation expense, (5) change in fair value of warrants and derivatives, (6) capitalized cloud computing amortization, (7) sales and use tax income, (8) restructuring charges related to reduction in force payments, (9) gain on extinguishment of debt, (10) litigation expenses (consisting of legal and related fees for a specific proceeding that is outside of our ordinary course of business), (11) warehouse 40 Table of Contents restructuring costs, (12) non-cash impairment of previously capitalized software and cloud computing implementation costs, (13) technology modernization costs, and (14) other items (as defined below).
The decrease in other income, net was primarily due to the $2.6 million decrease of income related to the changes in fair value of our warrant liabilities, offset by the gain on extinguishment of debt for $1.8 million. 36 Table of Contents Comparison of the Fiscal Years Ended March 31, 2023 and March 31, 2022 Revenue Fiscal Year Ended March 31, 2023 2022 $ Change % Change ( in thousands) Revenue Direct to Consumer $ 471,994 $ 448,074 $ 23,920 5.3 % Commerce 63,321 59,332 3,989 6.7 % Total revenue $ 535,315 $ 507,406 $ 27,909 5.5 % Percentage of Revenue Direct to Consumer 88.2 % 88.3 % Commerce 11.8 % 11.7 % Direct to Consumer revenue increased by $23.9 million, or 5.3%, for the fiscal year ended March 31, 2023 compared to the fiscal year ended March 31, 2022.
The decrease in other income, net was primarily due to the gain on extinguishment of debt in prior year of $1.8 million, as well as a decrease in the change of the fair value of our warrant liabilities of $3.2 million. 37 Table of Contents Comparison of the Fiscal Years Ended March 31, 2024 and March 31, 2023 Revenue Fiscal Year Ended March 31, 2024 2023 $ Change % Change ( in thousands) Revenue Direct to Consumer 436,446 471,994 (35,548) (7.5) % Commerce 53,738 63,321 (9,583) (15.1) % Total revenue $ 490,184 $ 535,315 $ (45,131) (8.4) % Percentage of Revenue Direct to Consumer 89.0 % 88.2 % Commerce 11.0 % 11.8 % Direct to Consumer revenue decreased by $35.5 million, or 7.5% , for the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31, 2023.
More recently, we have entered exciting, and much larger categories in the consumables space, which include kibble, treats, toppers, supplements, and dental products. This expansion has significantly increased our total addressable market and the number of customers we can serve.
In addition to being one of the largest dog toy brands in the U.S. by revenue, we also play in exciting, and much larger categories in the consumables space, which include kibble, treats, toppers, supplements, and dental products. These categories have significantly increased our total addressable market and the number of customers we can serve.
We calculate Adjusted Net Loss as net loss, adjusted to exclude: (1) stock-based compensation expense, (2) change in fair value of warrants and derivatives, (3) sales and use tax (income) expense, (4) restructuring charges related to reduction in force payments, (5) (gain) loss on extinguishment of debt, (6) duplicate rent expense incurred as a result of relocating our corporate headquarters, (7) asset impairment charges, (8) transaction costs associated with the Merger, (9) demurrage fees related to freight, (10) technology transformations and (11) other items (as defined below).
We calculate Adjusted Net Loss as net loss, adjusted to exclude: (1) stock-based compensation expense, (2) change in fair value of warrants and derivatives, (3) sales and use tax income, (4) restructuring charges related to reduction in force payments, (5) gain on extinguishment of debt, (6) litigation expenses (consisting of legal and related fees for a specific proceeding that is outside of our ordinary course of business), (7) warehouse restructuring costs, (8) non-cash impairment of previously capitalized software and cloud computing implementation costs, (9) technology modernization costs, and (10) other items (as defined below).
Interest Income Fiscal Year Ended March 31, 2023 2022 $ Change % Change ( in thousands) Interest income $ 1,056 $ — $ 1,056 N/M Percentage of revenue 0.2 % — % Interest income increased by $1.1 million for the fiscal year ended March 31, 2023 compared to the fiscal year ended March 31, 2022.
Interest Income Fiscal Year Ended March 31, 2025 2024 $ Change % Change ( in thousands) Interest income $ 4,926 $ 7,533 $ (2,607) (34.6) % Percentage of revenue 1.0 % 1.5 % Interest income decreased by $2.6 million for the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024.
Revenue related to BARK.co is recognized at a point in time, as control is transferred to the customer upon each delivery. Treats — Includes treats and chews included in our BarkBox and Super Chewer boxes, as well as the sale of treats on our consumables website. Many of our treats feature monthly themes, similar to our toys.
Treats — Includes treats and chews included in our BarkBox and Super Chewer boxes, as well as the sale of treats on our Bark.co. Many of our treats feature monthly themes, similar to our toys. Today, BARK is one of the largest treat brands in the U.S. by revenue.
For the fiscal year ended March 31, 2023, other items comprised of executive transition costs of $1.7 million and tax penalties of $0.1 million.
For the fiscal year ended March 31, 2024, other items comprised of non-recurring retention payments to management of $1.4 million, executive transition costs of $1.3 million, tax penalties of less than $0.1 million, and duplicate headquarters rent of less than $0.1 million.
These include all orders across all of our product categories, regardless of whether they are purchased on a subscription, auto-ship, or one-off basis. 30 Table of Contents Average Order Value Average Order Value (“AOV”) is Direct to Consumer revenue for the period divided by Total Orders for the same period.
Total Orders We define Total Orders as the total number of orders shipped in a given period. These include all orders across all of our product categories, regardless of whether they are purchased on a subscription, auto-ship, or one-off basis.
The following table presents a reconciliation of Free Cash Flow to Net cash provided by (used in) operating activities, the most directly comparable financial measure prepared in accordance with U.S.
For fiscal year ended March 31, 2023, other items is comprised of executive transition costs of $1.7 million, duplicate headquarters rent of $1.7 million, and tax penalties of $0.1 million. 43 Table of Contents The following table presents a reconciliation of Free Cash Flow to Net cash provided by (used in) operating activities, the most directly comparable financial measure prepared in accordance with U.S.
The decrease in other income (expense), net was primarily due to the $27.8 million decrease of income related to the changes in fair value of our warrant liabilities, offset by an increase in other income of $1.1 million.
The decrease in other income, net was primarily due to the $2.6 million decrease of income related to the changes in fair value of our warrant liabilities, offset by the gain on extinguishment of debt for $1.8 million. Non-GAAP Financial Measures We report our financial results in accordance with U.S. GAAP.
We also sell toys through our Commerce segment which is a network of retail partners and online major market places. This distribution channel allows us to reach new customers and introduce them to the BARK brand.
We also sell toys through our network of retail partners. Today, the commerce segment accounts for 14% of total revenue. This distribution channel allows us to reach new customers and introduce them to the BARK brand. Our toys & accessories category also includes revenue derived from the sale of other products such as beds, leashes, apparel, and other accessories.
During the life of their subscription, we offer customers incremental products via ATB, which allows us to cross-sell customers into our full portfolio of products, including kibble, treats, toppers, dental and more. ATB revenue is recognized at a point in time as control is transferred to the customer upon delivery of goods to the subscriber.
Customers have the option to subscribe to these products on a one month, three month, six month, or twelve month basis. During the life of their subscription, we offer our customers incremental products via ATB, which allows us to cross-sell customers across our full portfolio of products including kibble, treats, toppers, dental, and more.
These toppers are often single ingredient proteins that can be easily added to a dog’s existing meal plan. Toppers are particularly beneficial for picky eaters. Supplements —Includes a variety of dog supplements such as hip and joint support, and skin and coat support. These products are often targeted at specific breeds that are prone to certain ailments.
Toppers —Includes meal-enhancing sprinkles, broths, and bites that are added to a dog’s meal to enhance the flavor of their food. These toppers are often single ingredient proteins that can be easily added to a dog’s existing meal plan. Toppers are particularly beneficial for picky eaters.
Commerce revenue increased by $4.0 million, or 6.7%, for the fiscal year ended March 31, 2023 compared to the fiscal year ended March 31, 2022. This increase was primarily driven by the addition of new retail partners since March 31, 2022, as well as volume increases amongst existing retail partners during the period.
Commerce revenue increased by $14.6 million, or 27.2% , for the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024. This increase was primarily driven by sales volume from existing and new customers .
Advertising and Marketing Fiscal Year Ended March 31, 2023 2022 $ Change % Change ( in thousands) Advertising and marketing $ 68,807 $ 74,417 $ (5,610) (7.5) % Percentage of revenue 12.9 % 14.7 % Advertising and marketing expense decreased by $5.6 million, or 7.5%, for the fiscal year ended March 31, 2023 compared to the fiscal year ended March 31, 2022.
Advertising and Marketing Fiscal Year Ended March 31, 2025 2024 $ Change % Change ( in thousands) Advertising and marketing $ 83,756 $ 79,282 $ 4,474 5.6 % Percentage of revenue 17.3 % 16.2 % Advertising and marketing expense increased by $4.5 million, or 5.6%, for the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024.
The Credit Facility has been amended several times, most recently in December 2023. After giving effect to this most recent amendment, the maturity date of the Credit Facility is December 13, 2024. Certain of the Company’s obligations to Western Alliance and under the Credit Facility are guaranteed by certain of its subsidiaries and secured by substantially all of their assets.
Certain of the Company’s obligations to Western Alliance and under the Credit Facility are guaranteed by certain of its subsidiaries and secured by substantially all of their assets. The Company is evaluating alternative options or further renewal of this Credit Facility.
For the fiscal year ended March 31, 2022, net cash provided by financing activities was $355.5 million, primarily due to proceeds of $227.1 million proceeds from the Merger and proceeds from the PIPE of $200.0 million.
Cash flows provided by (used in) Financing Activities For the fiscal year ended March 31, 2025, net cash used in financing activities was $19.9 million, primarily due to payments to repurchase common stock of $18.5 million.
Gross profit as a percentage of revenue increased to 57.6% for the fiscal year ended March 31, 2023 compared to 55.6% for the fiscal year ended March 31, 2022.
The decrease in Direct to Consumer gross profit is primarily attributable to a decrease in revenue. The increase in Commerce gross profit is primarily attributable to an increase in revenue. Gross profit as a percentage of revenue increased 70 basis points for the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024.
Increases in freight costs and supply chain disruptions may continue and could impact our business, in particular as a result of global conditions that are created or driven by market factors or international events, such as increased inflation, war in Israel and the Ukraine and rising tensions between the U.S. and China.
Increases in cost of goods, freight costs and supply chain disruptions may continue and could impact our business, in particular as a result of the imposition of tariffs and the uncertainty surrounding such tariffs and other global conditions.
Fiscal Year Ended March 31, 2024 2023 Total Orders (in thousands) 13,924 14,888 Average Order Value $31.34 $31.70 Direct to Consumer Gross Profit (in thousands) $278,868 $285,328 Direct to Consumer Gross Margin 63.9% 60.5% Total Orders We define Total Orders as the total number of orders shipped in a given period.
Fiscal Year Ended March 31, 2025 2024 Total Orders (in thousands) 13,210 13,924 Average Order Value $31.04 $31.34 Direct to Consumer Gross Profit (in thousands) (1) $271,012 $278,868 Direct to Consumer Gross Margin (1) 66.1% 63.9% (1) Direct to Consumer Gross Profit and Direct to Consumer Gross Margin does not include the revenue or cost of goods sold from BARK Air.
Over the past several years, the Company has expanded into new and larger consumables markets such as kibble, toppers, supplements and dental products. To sell these products, the Company recently launched a new website, www.bark.co, which contains the majority of its consumables portfolio, all of which can be purchased on a recurring, auto-ship, or one-off basis.
Over the past several years, the Company has expanded into new and larger consumables markets such as kibble, toppers, supplements and dental products. The Company sells its consumables products both DTC (through Bark.co) and through its retail footprint.
Other income (expense), net decreased by $24.7 million for the fiscal year ended March 31, 2023 compared to the fiscal year ended March 31, 2022.
Other Income, net Fiscal Year Ended March 31, 2025 2024 $ Change % Change ( in thousands) Other income, net 132 5,328 $ (5,196) (97.5) % Percentage of revenue — % 1.1 % Other income, net decreased by $5.2 million for the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024.
Overall, we see significant runway in our consumables category long-term, and anticipate the majority of our future growth may be driven by these product categories. BARK Air —A first-of-its kind air travel experience tailored to dogs. The Company partnered with a jet charter company to begin offering premium flights for customers and their dogs.
BARK Air —Announced in April 2024, BARK Air is a first-of-its kind air travel experience tailored to dogs. The Company is partnered with several charter companies offering premium flights for customers and their dogs. Interested parties can book flights at dogsflyfirst.com.
For fiscal year ended March 31, 2022, other items is comprised of executive transition costs of $1.9 million, costs related to unrealized business ventures of $1.8 million, SOX implementation fees of $0.7 million, and loss on exercise of warrants of $0.1 million.
(4) For the fiscal year ended March 31, 2025, other items is comprised of executive transition costs of $0.8 million, costs associated with the share repurchase program of $0.4 million, and duplicate headquarters rent of less than $0.1 million.
Kibble —We sell a variety of kibble, priced to compete with the mass premium category. While our kibble can be purchased on an individual basis, we entered this market with a breed-based approach that recommends meal plans 31 Table of Contents consisting of a mix of kibble, toppers, and supplements based on the characteristics and personalities of various dog breeds.
Supplements —Includes a variety of dog supplements such as hip and joint support, and skin and coat support. These products are often targeted at specific breeds that are prone to certain ailments. Kibble —We sell a variety of kibble, priced to compete with the premium category. Our kibble can be purchased on an individual or autoship basis.
Cash Flows Comparison of the Fiscal Years Ended March 31, 2024, 2023 and 2022.
As of March 31, 2025 and March 31, 2024, there were no outstanding borrowings under the Credit Facility. As of March 31, 2025 and March 31, 2024, the Company was compliant with its financial covenants. 45 Table of Contents Cash Flows Comparison of the Fiscal Years Ended March 31, 2025, 2024 and 2023.
The increase in Direct to Consumer gross profit is primarily attributable to higher subscription AOV, lower costs from our suppliers and a decrease in inventory write-down expenditures. 37 Table of Contents Operating Expenses General and Administrative Expense Fiscal Year Ended March 31, 2023 2022 $ Change % Change ( in thousands) General and administrative $ 303,139 $ 301,870 $ 1,269 0.4 % Percentage of revenue 56.6 % 59.5 % General and administrative expense increased by $1.3 million, or 0.4%, for the fiscal year ended March 31, 2023 compared to the fiscal year ended March 31, 2022.
The increase in gross margin is primarily attributable to lower inbound freight and product cost improvements. 35 Table of Contents Operating Expenses General and Administrative Expense Fiscal Year Ended March 31, 2025 2024 $ Change % Change ( in thousands) Other general and administrative 114,257 128,576 (14,319) (11.1) % Shipping and fulfillment 139,123 139,814 (691) (0.5) % Total General and administrative $ 253,380 $ 268,390 $ (15,010) (5.6) % Percentage of revenue 52.3 % 54.8 % General and administrative expense decreased by $15.0 million, or 5.6%, f or the fiscal year ended March 31, 2025 compared to the fiscal year ended March 31, 2024.
Subsequently, as certain of these liabilities are waived by tax authorities or the applicable statute of limitations expires, the related accrued liability is reversed. (2) For the fiscal year ended March 31, 2024 impairment of assets is the non-cash impairment of previously capitalized software and prepaid software licenses.
Subsequently, as certain of these liabilities are waived by tax authorities or the applicable statute of limitations expires, the related accrued liability is reversed. (2) Litigation expenses related to a shareholder class action complaint, see Item 3. Legal Proceedings. (3) Includes consulting fees related to technology transformation activities, and payroll costs for employees that dedicate significant time to this project.
Cost of Revenue Cost of revenue primarily consists of the purchase price of inventory sold, inbound freight costs associated with inventory, shipping supply costs, and inventory shrinkage costs. Operating Expenses Operating expenses consist of general and administrative and advertising and marketing expenses.
Overall, we see significant runway in our consumables category long-term, and anticipate the majority of our future to be driven by these product categories along with services, like BARK Air. Cost of Revenue Cost of revenue primarily consists of the purchase price of inventory sold, duties, inbound freight costs associated with inventory, shipping supply costs, and inventory shrinkage costs.
Additionally, accounts payable and accrued expenses increased by $13.5 million related to increased expenditures to support general business growth, as well as the timing of payments, other liabilities of $12.6 million, prepaid expenses and other current assets of $1.1 million, and accounts receivable of $1.1 million. 45 Table of Contents The decrease in our net operating assets and liabilities was partially offset by the change in deferred revenue of $4.4 million.
The increase in our net operating assets and liabilities was primarily driven by an increase in inventory of $5.5 million, a reduction in our operating lease liabilities of $5.3 million, and a reduction in deferred revenue of $4.7 million, offset by an increase of accounts payable and accrued expenses of $11.7 million.
Online marketplaces revenue is recognized upon delivery of goods to the end customer. Our toys category also includes revenue derived from the sale of other products such as beds, leashes, apparel, and other miscellaneous products. Consumables— The majority of our consumables revenue today is derived from the treats and chews that are included in our BarkBox and Super Chewer boxes.
The allocation between Toys & Accessories and Consumables includes estimates and was determined utilizing data on stand-alone selling prices that the Company charges for similar offerings, and also reflects historical pricing practices. 31 Table of Contents Consumables— The majority of our consumables revenue today is derived from the treats and chews that are included in our BarkBox and Super Chewer boxes.
Removed
Customers have the option to subscribe to these products on a one month, six month, or twelve month basis. Subscription revenue is recognized at a point in time as control is transferred to the subscriber upon delivery of each monthly box.
Added
Expansion within new and existing retail channels Our commerce segment continues to be an important growth driver for the business and our ability to expand our product assortment within both new and existing retail partners remains a focus area. This expansion may also require increased investments in trade marketing, merchandising support, and logistics capabilities.
Removed
Commerce revenue derived from our retail partners is recognized net of estimates for sales returns, discounts, markdowns and allowances, after the goods are shipped, or when the retail customer picks up the goods directly from one of our distribution points and control of the goods is transferred to the customer.
Added
If we are unable to successfully grow our retail presence or maintain strong partnerships, our ability to reach new customers and drive incremental revenue may be limited.
Removed
Today, BARK is one of the largest treat brands in the U.S. by revenue. The Company recently began selling its treats through 2,400 Target and PetSmart doors nationwide and anticipates further retail distribution in the future. Toppers —Includes meal-enhancing sprinkles, broths and bites that are added to a dog’s food to enhance the flavor of their food.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeWe are primarily exposed to changes in short-term interest rates with respect to our cost of borrowing under our Western Alliance Agreement. As of March 31, 2024 there are no outstanding borrowings under the Credit Facility. We monitor our cost of borrowing under our facility, taking into account our funding requirements, and our expectations for short-term rates in the future.
Biggest changeWe are primarily exposed to changes in short-term interest rates with respect to our cost of borrowing under our Western Alliance Agreement. As of March 31, 2025 there were no outstanding borrowings under the Credit Facility. We monitor our cost of borrowing under our facility, taking into account our funding requirements, and our expectations for short-term rates in the future.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Risk As of March 31, 2024, we had cash and cash equivalents of approximately $125.5 million consisting of bank deposits and money market accounts.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Risk As of March 31, 2025, we had cash and cash equivalents of approximately $94.0 million consisting of bank deposits and money market accounts.

Other BARK 10-K year-over-year comparisons