QVC Group Reports First Quarter 2025 Financial Results

ENGLEWOOD, Colo.--(BUSINESS WIRE)--May 07, 2025-- 

QVC Group, Inc. ("QVC Group") (Nasdaq: QVCGA, QVCGB, QVCGP) today reported first quarter 2025 results(1) .

"In the first quarter we faced a challenging market backdrop. While the impacts are being felt across retail, we are particularly challenged as linear television viewership continued to decline, and tariff volatility strongly impacted consumer sentiment in discretionary retail," said David Rawlinson, President and CEO of QVC Group. "We continue to execute on our long-term strategy and are working to remain agile as we navigate these current headwinds. In particular, we believe social shopping is a transformative opportunity and are moving quickly to be a leader here. QVC's agreement with TikTok is a first of its kind partnership for 24/7 content creation and is one example of the innovation we will continue to deploy to reinvent our business."

First quarter 2025 headlines(2) :

   -- QVC Group revenue decreased 10% in both US Dollars and constant 
      currency(3) 
 
   -- Generated operating income of $14 million 
 
   -- Adjusted OIBDA(4) decreased 32% in US Dollars and decreased 31% in 
      constant currency 
 
   -- QxH revenue decreased 11% 
 
   -- QVC International revenue decreased 6% in US Dollars and decreased 4% in 
      constant currency 
 
   -- Cornerstone revenue decreased 13% 

Discussion of Results

Unless otherwise noted, the following discussion compares financial information for the three months ended March 31, 2025 to the same period in 2024.

 
 
                  FIRST QUARTER 2025 FINANCIAL RESULTS 
------------------------------------------------------------------------ 
                                                          % Change 
                                                          Constant 
(amounts in millions)      1Q24     1Q25   % Change      Currency(a) 
                         ------   ------   --------      ----------- 
Revenue 
   QxH                   $1,539   $1,368       (11)% 
   QVC International        572      537        (6)%             (4)% 
   Cornerstone              231      200       (13)% 
                          -----    -----   -------- 
   Total QVC Group 
    Revenue               2,342    2,105       (10)%            (10)% 
                          =====    =====   ======== 
 
Operating Income 
(Loss) 
   QxH(b)                $   94   $    -         NM 
   QVC International(c)      63       29       (54)%            (51)% 
   Cornerstone               (3)     (11)     (267)% 
   Unallocated 
    corporate cost           (9)      (4)        56% 
                          -----    -----   -------- 
   Total QVC Group 
    Operating Income 
    (Loss)                  145       14       (90)%            (89)% 
                          =====    =====   ======== 
 
Adjusted OIBDA (Loss) 
   QxH(b)                $  185   $  122       (34)% 
   QVC International(c)      75       63       (16)%            (13)% 
   Cornerstone                6       (4)        NM 
   Unallocated 
    corporate cost           (7)      (4)        43% 
                          -----    -----   --------      ----------- 
   Total QVC Group 
    Adjusted OIBDA       $  259   $  177       (32)%            (31)% 
                          =====    =====   ========      =========== 
 
 
a)    For a definition of constant currency financial metrics, see the 
      accompanying schedules. 
b)    In the first quarter of 2025, QxH recorded $36 million of restructuring 
      charges related to a reorganization plan. This is included in operating 
      income and excluded from Adjusted OIBDA. See Reconciling Schedule 2. 
c)    In the first quarter of 2025, QVC International recorded $21 million of 
      restructuring charges related to a reorganization plan. In the first 
      quarter of 2024, QVC International recorded a $1 million gain related to 
      the sale leaseback of a German property. These items are included in 
      operating income and excluded from Adjusted OIBDA. See Reconciling 
      Schedule 2. 
 

QxH

QxH revenue declined primarily due to a 10% decrease in units shipped, 2% decline in average selling price and lower shipping and handling revenue, partially offset by favorable returns. QxH reported sales declines across all categories.

Operating income and Adjusted OIBDA margin(4) decreased mainly due to higher fulfillment costs and sales deleverage, partially offset by lower selling, general, and administrative expenses, favorable commission rates and higher product margins. Operating income was also impacted by a $36 million restructuring charge related to the reorganization announced in March that was excluded from Adjusted OIBDA. Fulfillment pressure was driven by higher freight rates and labor costs. Product margins increased primarily due to mix shift to higher-margin products and favorable return rates. Operating expenses decreased due to favorable commission rates. Selling, general and administrative expenses declined primarily due to lower costs from technology outsourcing from our new IT managed services contract partially offset by sales deleverage.

QVC International

US Dollar denominated results were negatively impacted by exchange rate fluctuations due to the US Dollar weakening 1% against the British pound and 3% against the Euro, partially offset by the US Dollar strengthening 3% against the Japanese Yen. The financial metrics presented in this press release also provide a comparison of the percentage change in QVC International's results in constant currency (where applicable) to the comparable figures calculated in accordance with US GAAP for the first quarter of 2024.

QVC International's constant currency revenue declined due to a 4% decrease in units shipped and a 1% decrease in average selling price. QVC International reported constant currency revenue declines across home, beauty and apparel with growth in jewelry and electronics.

Operating income decreased in the first quarter mainly due to a $21 million restructuring charge related to the reorganization announced in March that was excluded from Adjusted OIBDA. Adjusted OIBDA margin decreased due to sales deleverage and higher fulfillment costs partially offset by higher product margins, lower operating expenses, and lower selling, general and administrative expenses. Fulfillment expense increased due to higher variable wage rates in Europe. Product margins increased primarily due to favorable returns. Operating expenses decreased due to lower commissions. Selling, general, and administrative expenses decreased due to lower costs from technology outsourcing.

Cornerstone

Cornerstone revenue decreased due to continued softness in interior furniture, outdoor furniture, and decor in the home sector and for apparel at Garnet Hill.

Operating income and Adjusted OIBDA margin decreased primarily due to sales deleverage and higher administrative costs related to the previously announced transformation plan, partially offset by lower fulfilment and supply chain costs.

 
 
                   FIRST QUARTER 2025 SUPPLEMENTAL METRICS 
------------------------------------------------------------------------------ 
 
(amounts in millions                                            % Change 
unless otherwise                                                Constant 
noted)                    1Q24        1Q25      % Change       Currency(a) 
                        ------      ------      --------       ----------- 
QxH 
   Cost of Goods Sold 
    % of Revenue          65.4%       67.5%          210  bps 
   Operating Income 
    Margin (%)(b)          6.1%        0.0%        (610)  bps 
   Adjusted OIBDA 
    Margin (%)(b)         12.0%        8.9%        (310)  bps 
   Average Selling 
    Price               $53.60      $52.63           (2)% 
   Units Sold                                       (10)% 
   Return Rate(c)         15.4%       15.3%         (10)  bps 
   eCommerce 
    Revenue(d)          $  958      $  867           (9)% 
   eCommerce % of 
    Total Revenue         62.2%       63.4%          120  bps 
   Mobile % of 
    eCommerce 
    Revenue(e)            69.8%       71.3%          150  bps 
   LTM Total 
    Customers(f)           8.0         7.4           (8)% 
 
QVC International 
   Cost of Goods Sold 
    % of Revenue          64.0%       64.8%           80  bps 
   Operating Income 
    Margin (%)(g)         11.0%        5.4%        (560)  bps 
   Adjusted OIBDA 
    Margin (%)(g)         13.1%       11.7%        (140)  bps 
   Average Selling 
    Price                                            (3)%              (1)% 
   Units Sold                                        (4)% 
   Return Rate(c)         19.2%       18.3%         (90)  bps 
   eCommerce 
    Revenue(d)          $  294      $  283           (4)%              (1)% 
   eCommerce % of 
    Total Revenue         51.4%       52.7%          130  bps 
   Mobile % of 
    eCommerce 
    Revenue(e)            68.8%       76.7%          790  bps 
   LTM Total 
    Customers(f)           4.1         4.0           (2)% 
 
Cornerstone 
   Cost of Goods Sold 
    % of Revenue          59.7%       57.5%        (220)  bps 
   Operating Income 
    Margin (%)           (1.3)%      (5.5)%        (420)  bps 
   Adjusted OIBDA 
    Margin (%)             2.6%      (2.0)%           NM 
   eCommerce 
    Revenue(d)          $  175      $  150          (14)% 
   eCommerce % of 
    Total Revenue         75.8%       75.0%         (80)  bps 
 
 
a)    For a definition of constant currency financial metrics, see the 
      accompanying schedules. 
b)    In the first quarter of 2025, QxH recorded $36 million of restructuring 
      charges related to a reorganization plan. This item is included in 
      operating income and excluded from Adjusted OIBDA. See Reconciling 
      Schedule 2. 
c)    Measured as returned sales over gross shipped sales in US Dollars. 
d)    Based on net revenue. 
e)    Based on gross US Dollar orders. 

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