Q4 2023 Qurate Retail Group Inc Earnings Call

February 28, 2024

[music].

Operator: Ladies and gentlemen, welcome to the Curate Retail Inc. 2023 Year-End Earnings Call. During the presentation, all participants will be in a listen-only mode.

Operator: Ladies and gentlemen, welcome to the Qurate Retail, Inc. 2023 year-end earnings call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. At that time, if you have a question, please press *1 on your telephone. As a reminder, this conference will be recorded 28 February. I would now like to turn the call over to Shane Kleinstein, Senior Vice President, Investor Relations. Please go ahead.

Ladies and gentlemen.

Welcome to the Q right retail, Inc, but he twenty-three Jordan earnings call.

During the presentation, all participants will be in a listen only mode.

Operator: Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press star 1 on your telephone. As a reminder, this conference will be recorded on February 28th. I would now like to turn the call over to Shane Kleinstein, Senior Vice President, Investor Relations. Please go ahead.

Afterwards, we will conduct a question and answer session.

That time, if you have a question. Please press star one on your telephone.

As a reminder, this conference being recorded February 28.

I would now like to turn the call Oh, what does she blankstein senior.

Senior Vice President Investor Relations. Please go ahead.

Jason Bazinet: Thank you and good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Form 10-K filed by our company and QVC with the SEC. These forward-looking statements speak only as of the date of this call, and Qurate Retail expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Qurate Retail's expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based. Please note that we have published slides to accompany the earnings release.

Shane Kleinstein: Thank you and good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Form 10-K filed by our company and QVC with the SEC. These forward-looking statements speak only as of the date of this call, and Qurate Retail expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Qurate Retail's expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based. Please note that we have published slides to accompany the earnings release.

Shane Kleinstein: Thank you and good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Form 10-K filed by our company and QDC with the SEC. These forward-looking statements speak only as of the date of this call, and Curate Retail expressly disclaims any obligation or undertaking to make any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectations with regard thereto, or any change in Please note that we have published slides to accompany the earnings release.

Thank you and good morning, before we begin we'd like to remind everyone that this call includes certain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.

Actual events or results could differ materially due to a number of risks and uncertainties, including pension in the most recent Form 10-K filed by our company in Q D C with the SEC.

These forward looking statements speak only as of the date of this call and retail expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward looking statements contained herein to reflect any change in terms of expectations with regard there to or any change in events conditions or circumstances on which any such statement is based.

Please note that we have published slides to accompany the earnings release.

Jason Bazinet: On today's call, we will discuss certain non-GAAP financial measures, including Adjusted OIBDA, Adjusted OIBDA margin, free cash flow, and constant currency. Information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary note and schedules one through three, can be found in the earnings press release issued today or our earnings presentation, which are available on our website. Today, speaking on the earnings call, we have Qurate Retail President and CEO David Rawlinson, Qurate Retail Group CFO Bill Wafford, and Qurate Retail Executive Chairman Greg Maffei. Now I'll turn the call over to David Rawlinson.

Shane Kleinstein: On today's call, we will discuss certain non-GAAP financial measures, including Adjusted OIBDA, Adjusted OIBDA margin, free cash flow, and constant currency. Information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary note and schedules one through three, can be found in the earnings press release issued today or our earnings presentation, which are available on our website. Today, speaking on the earnings call, we have Qurate Retail President and CEO David Rawlinson, Qurate Retail Group CFO Bill Wafford, and Qurate Retail Executive Chairman Greg Maffei. Now I'll turn the call over to David Rawlinson.

Shane Kleinstein: On today's call, we will discuss certain non-GAAP financial measures, including adjusted OEBDA, adjusted OEBDA margin, free cash flow, and constant currency. Information regarding the Comparable Gap Metrics, along with required definitions and reconciliations, including Preliminary Note and Schedules 1 through 3, can be found in the earnings press release issued today or our earnings presentation, which is available on our website. Today speaking on the earnings call, we have Curate Retail President and CEO David Rollinson, Curate Retail Group CFO Bill Wofford, and Curate Retail Executive Chairman Greg Maffei. Now I'll turn the call over to David Rollinson.

On today's call, we will address we will discuss certain non-GAAP financial measures, including adjusted OIBDA, adjusted OIBDA margin free cash flow and constant currency.

Information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary note and schedules one through three can be found in the earnings press release issued today or our earnings presentation, which are available on our website.

Today speaking on the earnings call, we have cured retail president and CEO, David Rawlinson here at retail group's CFO Bill Wafford anchored retail executive Chairman, Greg Maffei now I'll turn the call over to David Rawlinson.

Okay.

David Rollinson: Thank you, Shane, and good morning to everyone. Thank you for joining us today and for your interest in Curate Retail. 2023 was a transformative year for Curate with a number of key achievements. In mid-2022, we were facing substantial challenges across the business and announced Project Athens to improve our execution, reinvigorate our core value proposition, and return to significant OEBDA and free cash flow generation. We implemented initiatives to refresh our assortment, sharpen our pricing, enhance our programming, improve our productivity, and reduce our cost to serve. I'm thrilled to say that the initiatives we put into action have yielded strong, positive results, as evidenced by the adjusted OIDA growth we experienced in the second half of 2023 and the free cash flow generation over the year. We are encouraged by these results and look forward to continuing the momentum into 2024. Let me share several highlights from 2023.

David Rawlinson: Thank you, Shane, and good morning to everyone. Thank you for joining us today and for your interest in Qurate Retail. 2023 was a transformative year for Qurate Retail with a number of key achievements. In mid-2022, we were facing substantial challenges across the business and announced Project Athens to improve our execution, reinvigorate our core value proposition, and return to significant OIBDA and free cash flow generation. We implemented initiatives to refresh our assortment, sharpen our pricing, enhance our programming, improve our productivity, and reduce our cost to serve. I'm thrilled to say that the initiatives we put into action have yielded strong, positive results, as evidenced by the adjusted OIBDA growth we experienced in the second half of 2023 and the free cash flow generation over the year. We are encouraged by these results and look forward to continuing the momentum into 2024.

Thank you Sandy and good morning to everyone. Thank you for joining us today and for your interest in Q&A retail.

2023 was a transformative year for cure rate with a number of key achievements.

In mid 2022.

We were facing substantial challenges across the business and announced project assets to improve our execution reinvigorate our core value proposition and return to significant OIBDA and free cash flow generation.

Yeah.

We have implemented initiatives to refresh our assortment and sharpen our pricing enhance our programming improve productivity and reduce our cost to serve I'm.

I am thrilled to say that the initiatives, we put into action have yielded strong positive results as evidenced by the adjusted OIBDA growth, we experienced in the second half of 2023 and the free cash flow generation over the year. We are encouraged by these results and look forward to continuing the momentum into 2024.

David Rawlinson: Let me share several highlights from 2023. First, as anticipated, we generated strong Adjusted OIBDA growth in the second half of the year, with Q4 Adjusted OIBDA of 73%, as reported. This was primarily due to meaningful Gross Margin expansion of more than 200 basis points in 2023, with Gross Margin expansion for the last three consecutive quarters. We substantially improved our merchandise assortment with higher quality products, which resulted in higher average selling prices and product margins. Fulfillment expense was favorable as a result of renegotiating ocean shipping and in-market freight rates and executing a number of productivity enhancements. We reduced our inventory balance 22% year-over-year, making room for a fresher assortment and newer products, which benefited inventory obsolescence expense for the year. We also took down administrative costs at each of our businesses.

Let me share several highlights from 2023.

David Rollinson: First, as anticipated, we generated strong adjusted OEBDA growth in the second half of the year, with Q4 adjusted OEBDA of 73%, as reported. This was primarily due to meaningful gross margin expansion of more than 200 basis points in 2023, with gross margin expansion for the last three consecutive quarters. We substantially improved our merchandise assortment with higher quality products, which resulted in higher average selling prices and product margins. Fulfillment expense was favorable as a result of renegotiating ocean shipping and in-market freight rates and executing a number of productivity enhancements. We reduced our inventory balance 22% year-over-year, making room for a fresher assortment and newer products, which benefited inventory obsolescence expense for the year. We also took down administrative costs at each of our businesses. Second, we divested Zulily in May, delivering on Pillar 4 Project Athens to optimize our portfolio. Zulily had negatively impacted our profitability and cash profile with a $97 million adjusted OEBDA loss in 2022.

First as anticipated we generated strong adjusted OIBDA growth in the second half of the year with Q4, adjusted OIBDA up 73% as reported this was primarily due to meaningful gross margin expansion of more than 200 basis points in 2023 with gross margin expansion for the last three.

Consecutive quarters, we substantially improved our merchandise assortment with higher quality products, which resulted in higher average selling prices and product margins fulfillment expense was favorable as a result of renegotiating ocean shipping and end market freight rates and executing a number of productivity.

<unk> enhancements, we reduced our inventory balance 22% year over year, making room for a fresher assortment and newer products, which benefited inventory obsolescence expense for the year. We also took down administrative costs at each of our businesses.

David Rawlinson: Second, we divested Zulily and May, delivering on pillar four, Project Athens, to optimize our portfolio. Zulily had negatively impacted our profitability and cash profile, with a $97 million Adjusted OIBDA loss in 2022. The divestiture simplifies our portfolio and benefits our go-forward liquidity while allowing management to focus on our remaining businesses. Third, we increased free cash flow $586 million in 2023. In the first half of the year, this was mainly driven by working capital improvements from accounts payable and inventory reduction actions. In the back half of the year, our free cash flow generation was from significant Adjusted OIBDA growth. Finally, we reduced gross debt by approximately $1 billion in 2023, fortifying our balance sheet. This proves the business's ability to deliver on our commitments. We have fundamentally improved our execution capability through our transformation initiatives.

Second we divested Xu William MA delivery home pillar for project Athens to optimize our portfolio. So literally had negatively impacted our profitability and cash profile with a $97 million adjusted OIBDA loss in 2022 divestiture simplifies our portfolio and benefits.

David Rollinson: The divestiture simplifies our portfolio and benefits our go-forward liquidity while allowing management to focus on our remaining business. We increased free cash flow by $586 million in 2023. In the first half of the year, this was mainly driven by working capital improvements from accounts payable and inventory reduction actions. In the back half of the year, our free cash flow generation was from significant adjusted OEBDOT growth.

Our go forward liquidity, while allowing management to focus on our remaining businesses third we.

We increased free cash flow $586 million in 2023, and the first half of the year. This was mainly driven by working capital improvements from accounts payable and inventory reduction actions in the back half of the year, our free cash flow generation was significant for us from significant.

That OIBDA growth.

David Rollinson: Finally, we reduced gross debt by approximately $1 billion in 2023, fortifying our balance sheet. This proves the business's ability to deliver on our commitments. We have fundamentally improved our execution capability through our transformation initiatives. As we enter 2024, we have confidence in our ability to sustain momentum in creating a more streamlined, profitable, cash-producing, and relevant company. Taking a closer look at fourth-quarter performance, we built on continued momentum coming out of Q3 with strong adjusted OEBDI growth and gross margin expansion of 550 basis points. At QXH, revenue declined 4%, and units declined as we compared significant inventory liquidation sales from last year and from continued industry softness in consumer electronics.

Finally, we reduced gross debt by approximately $1 billion in 2023, fortifying our balance sheet.

This proves the businesses ability to deliver on our commitments, we have fundamentally improved our execution capability through our transformation initiatives as we enter 2024, we have confidence in our ability to sustain momentum and creating a more streamlined profitable cash producing.

David Rawlinson: As we enter 2024, we have confidence in our ability to sustain momentum in creating a more streamlined, profitable, cash-producing, and relevant company. Taking a closer look at Q4 performance, we built on continued momentum coming out of Q3, with strong Adjusted OIBDA growth and gross margin expansion of 550 basis points. At QXH, revenue declined 4%. Units declined as we comped significant inventory liquidation sales from last year and from continued industry softness in consumer electronics. We also made deliberate choices to drive higher average selling prices and gross margins and to shift category mix. This reduced revenue, but the resulting revenue had higher initial margins, which offset lower volume. In the US, similar to our retail peers, we did see customers start their shopping later in the holiday season. However, when the shopping did kick off, we had strong sell-throughs and key events, which drove sales.

And relevant company.

Taking a closer look at fourth quarter performance. We built on continued momentum coming out of Q3 with strong adjusted OIBDA growth and gross margin expansion.

550 basis points.

H revenue declined 4% unit declines as we Comped significant inventory liquidation sales from last year and from continued industry softness in consumer electronics.

David Rollinson: We also made deliberate choices to drop higher average selling prices and gross margins and to shift categories. This reduced revenue, but the resulting revenue had higher initial margins, which offset lower volume. In the U.S., similar to our retail peers, we did see customers start their shopping later in the holiday season.

We also made deliberate choices to drive higher average selling prices and gross margins and to shift the category mix. This reduced revenue, but the resulting revenue had higher initial margins, which offset lower volume.

And the U S similar to our retail peers, we did see customers start their shopping later in the holiday season. However, when the shopping Dk call. We had strong sell throughs in key events, which drove sales. We are pleased that <unk> grew market share as topline performance largely outpace discretionary.

David Rollinson: However, when the shopping did kick off, we had strong sell-throughs and key events that drove sales. We are pleased that QXH grew market share as top-line performance largely outpaced discretionary retail for the second consecutive quarter. Throughout the year, we have maintained focus on obtaining new, higher-quality inventory that would excite our customers and provide them with value. We reinvigorated our programming and honed the special relationship our customers have with hosts, which led to continued high engagement, growing total linear minutes viewed by 15% compared to the prior year. Moving to QVC International, we are proud to report QVC International grew cost-to-currency revenue and adjusted OIDA dot for the second consecutive quarter in Q4. We experienced particular strength in the UK as inflation in Europe is stabilizing. Adjusted OIDA dot growth was driven by improved product margins, rate efficiencies, and inventory management. Bill will provide more details.

David Rawlinson: We are pleased that QxH grew market share as top-line performance largely outpaced discretionary retail for the second consecutive quarter. Throughout the year, we have maintained focus on obtaining new, higher quality inventory that would excite our customers and provide them with value. We reinvigorated our programming and honed the special relationship our customers have with HSN, which led to continued high engagement, growing total linear minutes viewed 15% compared to the prior year. Moving to QVC International, we are proud to report QVC International constant currency revenue and adjusted OIBDA for the second consecutive quarter in Q4. We experienced particular strength in the UK as inflation in Europe is stabilizing. Adjusted OIBDA growth was driven by improved product margins, freight efficiencies, and inventory management. Bill will provide more details.

Retail for the second consecutive quarter.

Throughout the year, we have maintained focus on obtaining new higher quality inventory that would excite our customers and provide them with value.

We reinvigorated our programming and honed the special relationship our customers have with hose, which led to continued high engagement growing total linear minutes viewed 15% compared to the prior year.

Moving to QVC International we are proud to report QVC International grew constant currency revenue and adjusted OIBDA for the second consecutive quarter in Q4, we experienced particular strength in the U K as inflation in Europe is stabilizing.

Adjusted OIBDA growth was driven by improved product margins, great efficiencies and inventory management.

Bill will provide more details as we've said previously QVC international is executing a series of initiatives that are on track to deliver substantial adjusted OIBDA improvement reaching run rate through 2025. These initiatives include workforce reductions taken in Europe and in the second half of 2023.

David Rawlinson: As we've said previously, QVC International is executing a series of initiatives that are on track to deliver substantial Adjusted OIBDA improvement, reaching run rate through 2025. These initiatives include workforce reductions taken in Europe in the second half of 2023, as well as steps to optimize the organizational structure, drive margin opportunities, and improve broadcast and content strategies. One of the key initiatives in 2023 was the launch of Integrated Experience. It aims to turn QVC International into a seamless, integrated, and immersive digital experience. In the UK, our initial focus is gardening, and in Germany, food and kitchen. Both have shown positive customer engagement and driven increased sales in their respective categories, and we believe we can scale to other category segments and markets over time.

David Rollinson: As we've said previously, QVC International is executing a series of initiatives that are on track to deliver substantial adjusted OEBDI improvement, reaching run rate through 2025. These initiatives include workforce reductions taken in Europe in the second half of 2023, as well as steps to optimize the organizational structure, draw margin opportunities, and One of the key initiatives in 2023 was the launch of the Integrated Experience. It aims to turn QVC International into a seamless, integrated, and immersive digital experience. In the U.K., our initial focus is gardening, and in Germany, food and kitchen.

As well as steps to optimize the organizational structure drive margin opportunities and improve broadcast and content strategies. One of the key initiatives. In 2023 was the launch of integrated experience. It aims to turn at QVC international into a seamless integrated and diversity.

Digital experience.

In the U K, our initial focus is a gardening and in Germany, food and kitchen, both have shown positive customer engagement and driven increase sales in their respective categories and we believe we can scale to other category segments and markets overtime.

David Rollinson: Both have shown positive customer engagement and driven increased sales in their respective categories, and we believe we can scale to other category segments and markets over time. At Cornerstone, our businesses are focused on furniture and home décor, both of which are driven by new housing starts and household moves. However, with housing starts and home sales at historically depressed rates, Cornerstone's top line has been persistently impacted.

David Rawlinson: At Cornerstone, our businesses are focused on furniture and home decor, both of which are driven by new housing starts and household moves. With housing starts and home sales at historically depressed rates, Cornerstone's top line has been persistently impacted. In this difficult environment, we maintained our focus on cost management and generated substantial adjusted OIBDA growth in the fourth quarter. The improvement was primarily due to favorable supply chain costs as well as lower catalog and personnel expenses. Expanding physical retail presence has been a successful tool for driving sales, deeper customer engagement, and better access to design services and improved conversion. We opened two new retail stores in Columbus, Ohio, and Denver, Colorado, and relocated one in Q4. Back in the US, we saw strong performance in our streaming services, QVC+ and HSN+ in Q4 and throughout the year.

At cornerstone our businesses are focused on furniture and home decor, both of which are driven by new housing starts and household moves with housing starts and home sales at historically depressed rates cornerstones topline has been persistently impacted in this difficult environment, we maintained our focus on cost management.

David Rollinson: In this difficult environment, we maintained our focus on cost management and generated substantial adjusted order die growth in the fourth quarter. The improvement was primarily due to favorable supply chain costs as well as lower catalog and personnel expenses. Expanding our physical retail presence has been a successful tool for driving sales, deeper customer engagement, and better access to design services and improved conversion. We opened two new retail stores in Columbus, Ohio, and Denver, Colorado, and relocated one in Q4. Back in the U.S., we saw strong performance on our streaming services, QVC+, NHSN+, and Q4 and throughout the year. Total minutes viewed on our own platforms and fast channels increased 23% to 3.6 billion, representing 5% of our total U.S. minutes viewed in 2023.

<unk> and generate a substantial adjusted OIBDA growth in the fourth quarter.

The improvement was primarily due to favorable supply chain costs as well as lower catalog and personnel expenses.

Banding physical retail presence has been a successful tool for driving sales deeper customer engagement and better access to design services and improved conversion. We opened two new retail stores in Columbus, Ohio, and Denver, Colorado and relocated one in Q4.

Back in the U S. We saw strong performance in our streaming services QVC, plus and HSN plus in Q4 and throughout the year total minutes viewed on our own platforms and bass channels increased 23% to $3 6 billion representing <unk>.

David Rawlinson: Total minutes viewed on our own platforms and fast channels increased 23% to 3.6 billion, representing 5% of our total US minutes viewed in 2023. We see real opportunity in our streaming business. There's still a small percent of our overall revenue base. Streaming revenue grew more than 50% in 2023. We see similar growth rates continuing into 2024 as the business begins to scale. Let me now address our customer count. As I will describe, we have seen substantial stabilization in our customer count and encouraging signs of customer behavior. We believe that we have the customers we need to execute on Project Athens. Consistent with historical averages, QXH existing customers made up half of total customer count that generated 90% of 2023 sales. They purchased 31 items in 2023 and spent $1,600 on average.

5% of our total U S minutes viewed in 2023, we see real opportunity in our streaming business. There is still a small percent of our overall revenue base screening revenue grew more than 50% in 2023, we see similar growth rates continuing into 2024.

David Rollinson: We see real opportunity in our streaming business. So, still a small percent of our overall revenue base, streaming revenue grew more than 50% in 2023. We see similar growth rates continuing into 2024 as the business begins to scale. Let me now address our customer count. As I will describe, we have seen substantial stabilization in our customer count and encouraging signs of customer behavior. We believe that we have the customers we need to execute on Project App. Consistent with historical averages, QXH existing customers made up half of the total customer count that generated 90% of 2023 sales. They purchased 31 items in 2023 and spent $1,600 on average.

As the business begins to scale.

Let me now address our customer count as I will describe we have seen substantial stabilization in our customer count and encouraging signs of customer behavior. We believe that we have the customers we need to execute on project assets.

Consistent with historical averages.

H existing customers made up half of total customer count we generated 90% of 2023 sales. They purchased 31 items in 2023 and spent six to $800 on average the script of engagement is even more evident in our best customers at QVC U S.

David Rollinson: The strength of engagement is even more evident in our best customers at QVC-US, who are defined as purchasing at least 20 times a year. They were 17% of the count but generated 76% of the sales in 2023. They purchased, on average, 76 items in the year and increased their average spend 9% year-on-year to $3,900.

David Rawlinson: The strength of engagement is even more evident in our best customers at QVC US, who are defined as purchasing at least 20 times a year. They were 17% of the count but generated 76% of the sales in 2023. They purchased on average 76 items in the year and increased their average spend 9% year-over-year to $3,900. We substantially moderated the rate of decline in the customer file as we progressed through 2023. We've moderated the sequential decline of our trailing 12-month count to down less than 100,000 from Q3, compared to down nearly 400,000 from the same period last year. Lastly, we began acquiring more new customers. New customers grew for the second consecutive quarter in Q4, with growth accelerating to 21%. We are utilizing several channels to incentivize additional purchases among our new customers.

Who were defined as purchasing at least 20 times a year they were 17% of the town, which generated 76% of the sales in 2023. They purchased on average 76 items in the year and increase their average spend 9% year on year to $3900.

Yes.

David Rollinson: We substantially moderated the rate of decline in the customer file as we progressed through 2023. We've moderated the sequential decline of our trailing 12 month count to down less than 100,000 from Q3, compared to down nearly 400,000 from the same period last year. Lastly, we began acquiring more new customers. New customers grew for the second consecutive quarter in Q4, with growth accelerating to 21%. We are utilizing several channels to incentivize additional purchases among our new customers. To share just a few examples, we are sending welcome emails to introduce our hosts, top deals, and frequently purchased items.

We substantially moderated the rate of decline in the customer file as we progressed through 2023, we've moderated the sequential decline of our trailing 12 months count so down less than 100000 from Q3 compared to down nearly 400000 from the same peer.

Last year.

Lastly, we began acquiring more new customers new test customers grew for the second consecutive quarter in Q4 with growth accelerating to 21%.

We are utilizing several channels to incentivize additional purchases among our new customers to share just a few examples we are sending welcome E mails to introduce our host type deals and frequently purchased items, we are leveraging improved analytics to expose new customers to personalize content brands and categories.

David Rawlinson: To share just a few examples, we are sending welcome emails to introduce our hosts, top deals, and frequently purchased items. We are leveraging improved analytics to expose new customers to personalized content, brands, and categories based on their interactions with us. We have developed a next purchase direct email piece that features our top national brands and various ways to watch and engage with QVC. Rather than growing the file with expensive-to-obtain and hard-to-retain transient customers, for now, we are concentrating on stabilizing our customer file, retaining our best customers, and returning to new customer growth year over year that will contribute to customer file growth over time. We believe this is the prudent and profitable path and gives us the stability we need to continue to deliver on Project Athens in 2024. We also believe it sets us up nicely for customer file growth in 2025.

David Rollinson: We are leveraging improved analytics to expose new customers to personalized content, brands, and categories based on their interactions with us. And we have developed a next purchase direct email piece that features our top national brands and various ways to watch and engage with QVC. Rather than growing the file with expensive to obtain and hard to retain transient customers, for now, we are concentrating on stabilizing our customer file, retaining our best customers, and returning to new customer growth year over year that will contribute to customer file growth over time. We believe this is the prudent and profitable path and gives us the ability we need to continue to deliver on Project Athens in 2024.

Based on their interactions with us and we have developed a next purchase direct E mail piece that features our top national brands at various ways to watch and engaged with QVC.

Okay.

Rather than growing the file was expensive to obtain and hard to retain transient customers for now we are concentrating on stabilizing our customer file retaining our best customers and returning to new customer growth year over year that will contribute to customer file growth over time, we will.

Please this is the prudent and profitable path and gives us the stability we need to continue to deliver on project assets. In 2024. We also believe it sets us up nicely for our customer file growth in 2025.

David Rollinson: We also believe it sets us up nicely for customer file growth in 2025. Now I would like to touch again on why Curate's business model is differentiated across retail and the value we bring to customers, vendors, and celebrities. Starting with vendors.

David Rawlinson: Now, I would like to touch again on why Qurate's business model is differentiated across retail and the value we bring to customers, vendors, and celebrities. Starting with vendors, our platform continues to be very attractive to both new and existing vendors. We move meaningful volume and provide a scaled platform to connect with customers on a personal level and share product stories. We had impressive sell-through rates in Q4 across a range of price points and, in particular, on higher-end products where we were able to demonstrate compelling value for unique products. For example, at QVC, we offered FireLight lab-grown diamonds from 2 carats to 9 carats, ranging in price from $1,300 to $5,000. The entire collection was well-received, selling out across sizes and products, including a sold-out 9-carat tennis bracelet.

Now I would like to touch again, I'll walk through rates business model is differentiated across retail and the value, we bring to customers vendors and celebrities.

Starting with vendors our platform continues to be very attractive to both new and existing vendors, we move meaningful volume and provide a scaled platform to connect with customers on a personal level and share product stories, we had impressive sell through rates in Q4 across a range of price points and in part.

David Rollinson: Our platform continues to be very attractive to both new and existing vendors. We move meaningful volumes and provide a scalable platform to connect with customers on a personal level and share product stories. We had impressive sell-through rates in Q4 across a range of price points, and in particular on higher-end products, where we were able to demonstrate compelling value for unique products. For example, at QVC, we offered firelight lab-grown diamonds from 2 carats to 9 carats, ranging in price from $1,300 to $5,000.

Particularly on higher end products, where we were able to demonstrate compelling value oriented products. For example that QVC. We offered by your light lab grown diamonds from two carats to non carrots, ranging in price from $3500 to $5000. The entire collection was well risk.

David Rollinson: The entire collection was well-received, selling out across sizes and products, including a sold-out 9-carat Pimice bracelet. We also sold $5.7 million in a Ninja Woodfire Electric Smoker and Outdoor Grill, moving 19,000 units, priced at $300 apiece, at HSBEN. We sold out of a Daymac e-bike with a price point in excess of $1,000 over Black Friday weekend.

Selling out selling out across sizes and products, including a sold out non care at Timmins bracelet.

David Rawlinson: We also sold $5.7 million of a Ninja Woodfire electric smoker and outdoor grill, moving 19,000 units, priced at $300 apiece. At HSN, we sold out of a Daymak e-bike with a price point in excess of $1,000 over Black Friday weekend. In home decor, we sold $6 million of a Barefoot Dreams luxury throw on Cyber Monday. In beauty, we sold 40,000 units of an Elemis cream in one day and 114,000 units of a Beekman & Philosophy gift set in two days. The scale of this platform is very difficult to replicate and attractive to existing and new vendors. We debuted a new brand in tights, Sheertex, selling $2.4 million in just a couple of hours. We introduced a new leather handbag and luggage brand, Hulken, that sold $340,000 in 11 minutes. QVC and HSN have always been a home for celebrities, engaging personalities, and entrepreneurs.

We also sold $5 7 million.

Of a ninja with buyer electric smoker, and outdoor grill, moving 19000 units priced at $300 a piece at.

At HSN, we sold out of a day, Matt <unk> with a price point in excess of $1000 over Black Friday weekend and home decor, we sold $6 million of the <unk>.

David Rollinson: At Home Decor, we sold $6 million of a Barefoot Dreams luxury throw on Cyber Monday. In Beauty, we sold 40,000 units of an Elemis cream in one day and 114,000 units of a Beatman and Philosophy gift set in two days. The scale of this platform is very difficult to replicate and attractive to existing and new vendors.

But dreams luxury throw on cyber Monday, and beauty, we sold 40000 units of an element cream and one day and 114000 units.

At velocity gift set in two days.

Scale of this platform is very difficult to replicate and attractive to existing and new vendors. We debuted a new brands and types share tax selling $2 4 million and just a couple of hours, we introduced the new leather handbag and luggage brand wholesale that sold $340000 of 11 minutes.

David Rollinson: We debuted a new brand in tights, Sheertex, selling 2.4 million in just a couple of hours. We introduced a new leather handbag and luggage brand, Hulkin, that sold $340,000 in 11 minutes. QVC and HSN have always been a home for celebrities, engaging personalities, and entrepreneurs. We welcomed many familiar and new faces in the fourth quarter, with a great pipeline planned for 2024. At QVC, Laurence Dorian launched Beautiful, an exclusive fashion collection of dresses, outwear, and accessories. In connection with the launch, we conducted a satellite media tour with a nationally syndicated segment on Extra. At HSN, we teamed up with legendary singer Dolly Parton for the pre-sales of her debut rock album, Rockstar. Iconic singer Chaka Khan launched her own perfume.

QVC and HSN have always been a homecare celebrities engaging personalities and entrepreneurs, we welcome many familiar and new faces in the fourth quarter with a great pipeline planned for 2024 at QVC, Lawrence, Oregon launched a beautiful and exclusive.

David Rawlinson: We welcome many familiar and new faces in the fourth quarter with a great pipeline planned for 2024. At QVC, Lawrence Zarian launched Beautiful, an exclusive fashion collection of dresses, outerwear, and accessories. In connection with the launch, we conducted a satellite media tour with a nationally syndicated segment on Extra. At HSN, we teamed up with legendary singer Dolly Parton for the presale of her debut rock album, Rockstar. Iconic singer Chaka Khan launched her own perfume. Singer Katharine McPhee debuted her jewelry line, Radiance, by Absolute. Erin Andrews launched her sportswear line. Wolfgang Puck celebrated his 25th year with HSN with a new cookware line. During his time with HSN, he has generated more than $600 million in sales. Numerous other celebrities have teamed up with us recently, and our 2024 celebrity lineup is fantastic. In January, Scarlett Johansson debuted a new beauty line called Outset.

Cash and collection of dresses outerwear and accessories in connection with the launch we conducted a satellite media tour with a nationally syndicated segment an extra at HSN, we teamed up with legendary singer Dolly Parton for the pre sales start her debut rock album Rockstar.

Iconic singer charter Con launched their own perfume senior Katherine Mcbee debuted her jewelry line radiance for absolute Erin Andrews launched or sportswear line Wolfgang puck celebrated its 25th year with HSN with the new Copa Airlines do.

David Rollinson: Singer Katharine McPhee debuted her jewelry line, Radiance, by Absolute. Erin Andrews launched her sportswear line. Wolfgang Puck celebrated his 25th year with HSN and a new cookware line. During his time with HSN, he generated more than $600 million in sales. Numerous other celebrities have teamed up with us recently, and our 2024 celebrity lineup is fantastic. In January, Scarlett Johansson debuted a new beauty line called Outset. Actress Christina Ricci came on air as the new brand ambassador for Lancer Skin Care.

During his time with HSN, he has generated more than $600 million in sales <unk>.

<unk> other celebrities has teamed up with US recently and our 2020 for celebrity lineup is fantastic and January Scarlett Johansen debuted a new beauty line called outset.

David Rawlinson: Actress Christina Ricci came on air as the new brand ambassador for Lancer Skincare. In March, self-taught cake artist and social media influencer Yolanda Gampp, who has 4.5 million YouTube subscribers and 2.8 million Instagram followers, will introduce a new bakeware line. Many other celebrities will join us this year, and we look forward to sharing more on future calls. And finally, we continue to provide value to customers through compelling product values, exposure to their favorite hosts and celebrities, and importantly, our engaging programming. Our programming is enhanced by destination and must-see events, especially around the holiday season. We hosted a 49-hour nonstop holiday party across channels and platforms with fun holiday shopping and special pop-in personalities. 680,000 customers shopped the weekend, including more than 40,000 new customers. The event generated 81 million views across social platforms.

Actress Christine Christine Christina Ricky came on air as the New brand Ambassador for Lancer, Skincare and March self type cake artist and social media Influencer, Yolanda gap, who has $4 5 million Youtube subscribers and $2 8 million Instagram followers.

David Rollinson: In March, self-taught cake artist and social media influencer Yolanda Gamp, who has 4.5 million YouTube subscribers and 2.8 million Instagram followers, will introduce a new bakeware line. Many other celebrities will join us this year, and we look forward to sharing more on future calls. And finally, we continue to provide value to customers through compelling product values, exposure to their favorite hosts and celebrities, and importantly, our engaging program. Our programming is enhanced by destination and must-see events, especially around the holiday season. We hosted a 49-hour nonstop holiday party across channels and platforms with fun holiday shopping and special pop-in personalities. 680,000 customers shopped the weekend, including more than 40,000 new customers. The event generated 81 million views across social platforms. It featured several live streams, including The Holiday Guide to Get-Togethers with Jenny Garth, Holiday Head to Head to Stoat to..., holiday head-to-toe style with experts, Sandra Lee's hot chocolate cocktails, and holiday recipes in 30 minutes with Fabio Bavani.

We will introduce a new bakeware alone. Many other celebrities will join US this year and we look forward to sharing more on future calls.

And finally, we continue to provide value to customers through compelling product values exposure to their favorite host and celebrities and importantly.

Engaging programming.

Our programming is enhanced by destination and must be events, especially around the holiday season, we hosted a 49 hour non-stop holiday party across channels and platforms with fund holiday shopping and special pop and personalities 680000 customers shop, the weekend, including more than <unk>.

40000, new customers the event generated 81 million views across social platforms. It features several livestreams, including holiday God to get Togethers with Ginnie GARP holiday head to head sorry holiday head to stope.

David Rawlinson: It featured several live streams, including Holiday Guide to Get Together with Jennie Garth, Holiday Head to Sorry, Holiday Head to Toast Style with experts, Sandra Lee's Hot Chocolate Cocktails, and Holiday Recipes in 30 Minutes with Fabio Viviani. We have also appeared on other powerful platforms to fuel engagement. QVC hosts presented gift ideas on popular talk shows, including The Drew Barrymore Show and The Tamron Hall Show, to promote our holiday giftathon. We remain excited about the value proposition that makes QVC and HSN unique and will continue leveraging this model as we expand across platforms. Finally, I want to discuss an organizational change we announced yesterday. I'm pleased to announce that Stacy Bowe will be taking over as the president of HSN.

Holiday head to toe style with experts Sandra leaves hot chocolate cocktails and holiday recipes and 30 minutes with Fabio Pavan.

David Rollinson: We have also appeared on other powerful platforms to fuel engagement. QVC hosts presented gift ideas on popular talk shows, including the Drew Barrymore Show and the Tamron Hall Show, to promote our holiday gift-a-thon. We remain excited about the value proposition that makes QVC and HSN unique, and we'll continue leveraging this model as we expand across platforms. Finally, I want to discuss an organizational change we announced yesterday. I'm pleased to announce that Stacey Bowe will be taking over as President of HSN.

We are also appeared on other powerful platforms to fuel engagement QVC host presented gift ideas on popular talk shows, including the drew Barrymore show and the tamarin Harsha to promote our holiday gift that we remain excited about the value proposition that makes QVC and HSN unique.

And we will continue leveraging this model as we expand across platforms.

Finally.

I wanted to discuss an organizational change we announced yesterday I am pleased to announce that Stacy Bo will be taking over as the president of HSN safety has been serving as the chief merchant at QVC U S. Since joining the company in 2022 and has been one of the driving forces behind the improvement at QVC, including rapid.

Bill Wofford: Stacey has been serving as the Chief Merchant at QVC U.S. since joining the company in 2022 and has been one of the driving forces behind the improvement at QVC, including rapidly recalibrating our buying program, improving our inventory levels, and bringing freshness and newness to the assortment. Prior to QVC, Stacey had a decorated career at G3 Apparel Group, and I would like to thank Rob Mueller for his 23 years of extraordinary contributions to the company, including serving for the last two years as president of HSN. In summary, our business reached an inflection point in the third quarter of 2023. We have made substantial progress in stabilizing revenue and growing cash flow and profitability. We look forward to continuing to drive improved results in 2024 while preparing the business for its future of multi-platform growth. Now I'll turn the call over to Bill to discuss the financial results of each of our businesses in more detail. Thank you, David, and good morning, everyone.

David Rawlinson: Stacy has been serving as the chief merchant at QVC US since joining the company in 2022 and has been one of the driving forces behind the improvement at QVC, including rapidly recalibrating our buying program, improving our inventory levels, and bringing freshness and newness to the assortment. Prior to QVC, Stacy had a decorated career at G-III Apparel Group and Macy's. I would like to thank Rob Muller for his distinguished 23 years of extraordinary contributions to the company, including serving for the last two years as president of HSN. In summary, our business reached an inflection point in Q3 of 2023. We have made substantial progress in stabilizing revenue and growing cash flow and profitability. We look forward to continuing to drive improved results in 2024 while preparing the business for its future of multi-platform growth.

Recalibrating, our buying program, improving our inventory levels and bring a freshness and newness to the assortment prior to QVC safety had a decorated career at G. III apparel group in Macy's I would like to thank Rob Muller for his distinguished 23 years of extraordinary contributions to the <unk>.

Company, including serving for the last two years as president of HSN.

In summary, our business reached an inflection point in the third quarter of 2023, we have made substantial progress in stabilizing revenue and growing cash flow and profitability. We look forward to continuing to drive improved results in 2024, while preparing the business for its future.

A multi platform growth now I'll turn the call to bill to discuss the financial results of each of our businesses in more detail.

David Rawlinson: Now, I'll turn the call to Bill to discuss the financial results of each of our businesses in more detail.

Shane Kleinstein: Thank you, David, and good morning, everyone. Unless otherwise noted, my comments compare financial performance for the three months ended December 31, 2023, to the same period in 2022. Starting with QXH, revenue declined 4%, primarily on lower unit volume. These pressures were partially offset by 3% growth in average selling price. As David mentioned, lower unit volume was in part a result of comping to liquidation sales in Q4 2022 to actively reduce inventory. While this negatively impacted revenue, it was accretive to profitability. Second, we saw higher returns in the fourth quarter, which are normalizing to pre-pandemic levels across the industry after an extended low period during the pandemic. From a category perspective, QXH experienced growth in apparel and jewelry. These gains were offset by a decline mainly in electronics, which accounted for 64% of QXH's revenue decrease.

Bill Wafford: Thank you, David, and good morning, everyone. Unless otherwise noted, my comments compare financial performance for the three months ended December 31, 2023, to the same period in 2022. Starting with QXH, revenue declined 4%, primarily on lower unit volume. These pressures were partially offset by 3% growth in average selling price. As David mentioned, lower unit volume was in part a result of comping to liquidation sales in Q4 2022 to actively reduce inventory. While this negatively impacted revenue, it was accretive to profitability. Second, we saw higher returns in the fourth quarter, which are normalizing to pre-pandemic levels across the industry after an extended low period during the pandemic. From a category perspective, QXH experienced growth in apparel and jewelry. These gains were offset by a decline mainly in electronics, which accounted for 64% of QXH's revenue decrease.

Thank you David and good morning, everyone.

Bill Wofford: Unless otherwise noted, my comments compare financial performance for the three months ended December 31, 2023 to the same period in 2022. Starting with QXH, revenue declined 4%, primarily due to lower unit volume. These pressures were partially offset by 3% growth in average selling price. As David mentioned, lower unit volume was in part a result of comping the liquidation sales in Q4 2022 to actively reduce inventory. While this negatively impacted revenue, it was accretive to profitability. Second, we saw higher returns in the fourth quarter, which are normalizing to pre-pandemic levels across the industry after an extended low period during the pandemic. From a category perspective, QXH experienced growth in apparel and jewelry. However, these gains were offset by a decline mainly in electronics, which accounted for 64% of QXH's revenue decrease.

Unless otherwise noted my comments compare financial performance for the three months ended December 31, 2023 to the same period in 2022 <unk>.

Starting with <unk> X H revenue declined 4% primarily on lower unit volume. These pressures were partially offset by a 3% growth in average selling price.

As David mentioned lower unit volume was in part a result of Comping. The liquidation sales in Q4 2022 to actively reduce inventory.

While this negatively impacted revenue it was accretive to profitability.

We saw higher returns in the fourth quarter, which are normalizing to pre pandemic levels across the industry. After an extended low period during the pandemic.

From a category perspective, <unk> experienced growth in apparel and jewelry. These gains were offset by a decline mainly in electronics, which accounted for 64% of <unk> revenue decrease.

Shane Kleinstein: The decline in electronics is primarily driven by category softness across the industry due to lack of innovation, as well as a strategic pullback in the category as our merchandise team focuses on higher-margin categories. Apparel grew 3% due to strength in classic and contemporary apparel. Jewelry grew 8%, mainly on the strength of fine jewelry. Home revenue decreased 2%, mainly due to lower demand for home improvement and floor care, partially offset by growth in cleaning and fitness. Beauty declined 1%, mainly due to lower demand for bath and body, as well as our strategic decision to dedicate more airtime to launching and growing smaller brands in order to diversify our assortment. This was partially offset by strong performance in beauty devices. Accessories declined 3%, primarily due to lower demand for loungewear, partially offset by strength in fashion accessories and footwear.

Bill Wafford: The decline in electronics is primarily driven by category softness across the industry due to lack of innovation, as well as a strategic pullback in the category as our merchandise team focuses on higher-margin categories. Apparel grew 3% due to strength in classic and contemporary apparel. Jewelry grew 8%, mainly on the strength of fine jewelry. Home revenue decreased 2%, mainly due to lower demand for home improvement and floor care, partially offset by growth in cleaning and fitness. Beauty declined 1%, mainly due to lower demand for bath and body, as well as our strategic decision to dedicate more airtime to launching and growing smaller brands in order to diversify our assortment. This was partially offset by strong performance in beauty devices. Accessories declined 3%, primarily due to lower demand for loungewear, partially offset by strength in fashion accessories and footwear.

Bill Wofford: The decline in electronics was primarily driven by category softness across the industry due to a lack of innovation, as well as a strategic pullback in the category as our merchandise team focuses on the higher-margin category, apparel, which grew 3% due to strength in classic and contemporary apparel. Jewelry grew 8%, mainly on the strength of fine jewelry. Home revenue decreased 2%, mainly due to lower demand for home improvement and floor care, partially offset by growth in cleaning and fitness.

The decline in electronics is primarily driven by category softness across the industry due to the lack of innovation as well as the strategic pullback in the category as our merchandise team focuses on higher margin categories.

Apparel grew 3% due to strength in classic and contemporary apparel.

Jewelry grew 8% mainly on the strength of fine jewelry.

Home revenue decreased 2%, mainly due to lower demand for home improvement and floor care, partially offset by growth in cleaning and fitness.

Bill Wofford: Beauty declined 1%, mainly due to lower demand for bath and body, as well as our strategic decision to dedicate more air time to launching and growing smaller brands in order to diversify our assortment. This was partially offset by strong performance in beauty devices. Accessories declined 3%, primarily due to lower demand for loungewear, partially offset by strength in fashion accessories and footwear.

Beauty declined 1%, mainly due to lower demand for Bath and body as well as our strategic decision to dedicate more airtime launching and growing smaller brands in order to diversify our assortment. This was partially offset by strong performance in BD devices.

Accessories declined 3%, primarily due to lower demand for loans were partially offset by strength in fashion accessories and footwear.

Bill Wofford: Adjusted Orbital Margin increased 360 basis points, with gross margin expansion of 450 basis points, primarily driven by favorable product margins, fulfillment, and inventory obsolescence expenses. Product margins increased 215 basis points, driven by mix shift to higher-margin products and fewer clearance actions due to improved inventory health. Fulfillment expenses improved 155 basis points due to improved efficiency and path factor from Project Athens initiatives, less detention and demerge costs, and favorable rates from our new parcel carrier contract that went into effect in late July. Inventory obsolescence declined, reflecting enhanced merchandising source assortment and comping 2022's Q4 inventory reduction. SG&A was unfavorable by approximately 75 basis points, primarily due to sales due to leverage on administrative and marketing expenses.

Shane Kleinstein: Adjusted OIBDA margin increased 360 basis points, with gross margin expansion at 450 basis points, primarily driven by favorable product margins, fulfillment, and inventory obsolescence expense. Product margins increased 215 basis points, driven by mix shift to higher-margin products and fewer clearance actions due to improved inventory health. Fulfillment expenses improved 155 basis points due to improved efficiency and pack factor from Project Athens initiatives, less detention and demurrage costs, and favorable rates from our new parcel carrier contract that went into effect in late July. Inventory obsolescence declined, reflecting enhanced merchandise and assortment and comping 2022's Q4 inventory reductions. SG&A was unfavorable by approximately 75 basis points, primarily due to sales deleverage on administrative and marketing expenses. Bad debt expense accounted for approximately 20 basis points of pressure due to provision adjustments, while our overall bad debt rates remain low at well under 2% of revenue.

Bill Wafford: Adjusted OIBDA margin increased 360 basis points, with gross margin expansion at 450 basis points, primarily driven by favorable product margins, fulfillment, and inventory obsolescence expense. Product margins increased 215 basis points, driven by mix shift to higher-margin products and fewer clearance actions due to improved inventory health. Fulfillment expenses improved 155 basis points due to improved efficiency and pack factor from Project Athens initiatives, less detention and demurrage costs, and favorable rates from our new parcel carrier contract that went into effect in late July. Inventory obsolescence declined, reflecting enhanced merchandise and assortment and comping 2022's Q4 inventory reductions. SG&A was unfavorable by approximately 75 basis points, primarily due to sales deleverage on administrative and marketing expenses. Bad debt expense accounted for approximately 20 basis points of pressure due to provision adjustments, while our overall bad debt rates remain low at well under 2% of revenue.

Adjusted OIBDA margin increased 360 basis points with gross margin expansion of 450 basis points, primarily driven by favorable product margins fulfillment and inventory obsolescence expense.

Product margins increased 215 basis points, driven by mix shift to higher margin products and fewer clearance actions due to improved inventory health.

Fulfillment expenses improved 155 basis points due to improved efficiency.

And Pat factor from project Athans initiatives, less detention and demurrage costs and favorable rates from our new parcel carrier contract that went into effect in late July.

Inventory obsolescence declined reflecting enhanced merchandising assortment and Comping 2020, twos Q4 inventory reductions.

SG&A was unfavorable by approximately 75 basis points, primarily due to sales deleverage on administrative and marketing expenses.

Bill Wofford: Bad debt expense accounted for approximately 20 basis points of pressure due to provisional adjustments, while our overall bad debt rates remain low at well under 2% of revenue. Before moving on to QVC International, as noted in our earnings release, we conducted an annual impairment assessment and recognized a $326 million non-cash goodwill impairment charge at QXH. This is included in operating income, but excluded from adjusted oil.

Bad debt expense accounted for approximately 20 basis points of pressure due to provisional adjustments, while our overall bad debts or bad debt rates remained low at well under 2% of revenue.

Shane Kleinstein: Before moving on to QVC International, as noted in our earnings release, we conducted an annual impairment assessment and recognized a $326 million non-cash goodwill impairment charge at QxH. This is included in operating income but excluded from Adjusted OIBDA. Moving to QVC International, my comments will focus on constant currency results. Revenue grew slightly, reflecting a 1% increase in average selling price, offset by a 1% decrease in unit volume. QVC UK better performance up low double digits with sales gains in all but one category and particular strength in home. Japan was down slightly, and Germany declined mid-single digits. From a category perspective, QVC International experienced growth mainly in home and beauty, with declines in apparel and accessories. Adjusted OIBDA increased 2%, and Adjusted OIBDA margin was flat. Gross margin increased 100 basis points, mainly due to improved product margins in the UK and Germany.

Bill Wafford: Before moving on to QVC International, as noted in our earnings release, we conducted an annual impairment assessment and recognized a $326 million non-cash goodwill impairment charge at QxH. This is included in operating income but excluded from Adjusted OIBDA. Moving to QVC International, my comments will focus on constant currency results. Revenue grew slightly, reflecting a 1% increase in average selling price, offset by a 1% decrease in unit volume. QVC UK better performance up low double digits with sales gains in all but one category and particular strength in home. Japan was down slightly, and Germany declined mid-single digits. From a category perspective, QVC International experienced growth mainly in home and beauty, with declines in apparel and accessories. Adjusted OIBDA increased 2%, and Adjusted OIBDA margin was flat. Gross margin increased 100 basis points, mainly due to improved product margins in the UK and Germany.

Before moving on to QVC International as noted in our earnings release, we conducted an annual impairment assessment and recognized a $326 million noncash goodwill impairment charge <unk> X. H. This is included in operating income, but excluded from adjusted OIBDA.

Bill Wofford: Moving to QVC International, my comments will focus on constant currency results. Revenue grew slightly, reflecting a 1% increase in average selling price, offset by a 1% decrease in unit volume. QVC UK Letter Performance was up low double digits with sales gains in all but one category and particular strength in homes. Japan was down slightly, and Germany declined mid-single digit.

Moving to QVC International My comments will focus on constant currency results.

Revenue grew slightly reflecting a 1% increase in average selling price offset by a 1% decrease in unit volume.

QVC U K letter performance up low double digits with sales gains in all but one category and particular strength in home <unk>.

Japan was down slightly in Germany declined mid single digits.

Bill Wofford: From a category perspective, QVC International experienced growth mainly in home and beauty, with declines in apparel and accessories. Adjusted OEBDA increased 2%, and adjusted OEBDA margin was flat. Gross margin increased 100 basis points, mainly due to improved product margins in the UK and Germany. QVC International also benefited from fewer inventory clearance actions due to healthier inventories compared to last year, lower supply chain costs from ocean containers in Europe, and a mixed shift to higher-margin products, including PCP. Fulfillment was unfavorable primarily due to $4 million of rent from the sale meet leaseback transactions in January and increased labor costs. SG&A was unfavorable due to higher administrative costs from outside services related to transformation actions and management incentive crudels, partially offset by lower marketing expenses.

From a category perspective, QVC international experience growth, mainly in home and beauty with declines in apparel and accessories.

Adjusted OIBDA increased 2% and adjusted OIBDA margin was flat.

Gross margin increased 100 basis points, mainly due to improved product margins in the UK and Germany.

Shane Kleinstein: QVC International benefited from fewer inventory clearance actions due to healthier inventories compared to last year, lower supply chain costs from ocean containers in Europe, and a shift to higher-margin products, including beauty. Fulfillment was unfavorable, primarily due to $4 million of rent from the sale-leaseback transactions in January and increased labor costs. SG&A was unfavorable due to higher administrative costs from outside services related to transformation actions and management incentive rules, partially offset by lower marketing expense. QVC International is executing a series of transformation initiatives that are on track to deliver substantial Adjusted OIBDA improvement, reaching run-rate through 2025. Moving to Cornerstone, revenue declined 12% in the quarter. We experienced soft demand in most home categories, as well as in apparel at Garnet Hill. Despite the decline in revenue, Cornerstone diligently managed costs and significantly grew Adjusted OIBDA.

Bill Wafford: QVC International benefited from fewer inventory clearance actions due to healthier inventories compared to last year, lower supply chain costs from ocean containers in Europe, and a shift to higher-margin products, including beauty. Fulfillment was unfavorable, primarily due to $4 million of rent from the sale-leaseback transactions in January and increased labor costs. SG&A was unfavorable due to higher administrative costs from outside services related to transformation actions and management incentive rules, partially offset by lower marketing expense. QVC International is executing a series of transformation initiatives that are on track to deliver substantial Adjusted OIBDA improvement, reaching run-rate through 2025. Moving to Cornerstone, revenue declined 12% in the quarter. We experienced soft demand in most home categories, as well as in apparel at Garnet Hill. Despite the decline in revenue, Cornerstone diligently managed costs and significantly grew Adjusted OIBDA.

<unk> international benefited from fewer inventory clearance actions due to healthier inventories compared to last year lower supply chain costs from ocean containers in Europe, and a mix shift to higher margin products, including PC.

Fulfillment was unfavorable primarily due to $4 million of rent from the sale leaseback transactions in January and increased labor costs.

SG&A was unfavorable due to higher administrative costs from outside services related to transformation actions and management incentive accruals, partially offset by lower marketing expense.

Bill Wofford: QVC International is executing a series of transformation initiatives that are on track to deliver substantial adjusted OIVD improvement reaching run rate through 2025. Moving to Cornerstone. However, revenue declined 12% in the quarter.

We see international is executing a series of transformation in this initiatives that are on track to deliver substantial adjusted OIBDA improvement reaching run rate through 2025.

Moving to cornerstone.

Revenue declined 12% in the quarter.

Bill Wofford: We experienced soft demand in most home categories, as well as in apparel at Garnet Hill, despite the decline in revenue. Cornerstone diligently managed costs and significantly grew adjusted. Growth was primarily driven by decreased supply chain costs from lower ocean shipping rates and less detention and demurrage costs. These gains were partially offset by promotional activity and de-leverage of marketing expenses, which turned into cash flow in the balance sheet. Full year Capital Expenditures were $230 million.

We experienced soft demand and most home categories as well as in apparel at Garnet Hill.

Despite despite the decline in revenue.

Cornerstone diligently manage costs and significantly grew adjusted OIBDA.

Shane Kleinstein: Growth was primarily driven by decreased supply chain costs from lower ocean shipping rates and less detention and demurrage costs. These gains were partially offset by promotional activity and de-leverage of marketing expense. Turning to cash flow and the balance sheet, full-year capital expenditures were $230 million. For 2024, we anticipate capital expenditures to be approximately $235 to $250 million. We spent $113 million on renewals of our TV distribution contracts in 2023. Our TV distribution payments can fluctuate year-over-year depending on renewal cycles, though we continue to expect the two-year average to be approximately $100 million. Free Cash Flow for 2023 was $577 million versus a use of $9 million last year. The year-over-year improvement was attributable to increased cash flow from operations, driven by working capital improvements in the front half of the year and higher earnings in the back half of the year.

Bill Wafford: Growth was primarily driven by decreased supply chain costs from lower ocean shipping rates and less detention and demurrage costs. These gains were partially offset by promotional activity and de-leverage of marketing expense. Turning to cash flow and the balance sheet, full-year capital expenditures were $230 million. For 2024, we anticipate capital expenditures to be approximately $235 to $250 million. We spent $113 million on renewals of our TV distribution contracts in 2023. Our TV distribution payments can fluctuate year-over-year depending on renewal cycles, though we continue to expect the two-year average to be approximately $100 million. Free Cash Flow for 2023 was $577 million versus a use of $9 million last year. The year-over-year improvement was attributable to increased cash flow from operations, driven by working capital improvements in the front half of the year and higher earnings in the back half of the year.

Growth was primarily driven by decreased supply chain costs from lower ocean shipping rates and less detention and demurrage costs.

These gains were partially offset by promotional activity and deleverage of marketing expense.

Turning to cash flow and the balance sheet.

Full year capital expenditures were $230 million.

Bill Wofford: For 2024, we anticipate capital expenditures to be approximately $235 to $250 million. We spent $113 million on renewals of our TV distribution contracts in 2023. Our PV distribution payments can fluctuate year-over-year depending on renewal cycles, so we continue to expect the two-year average to be approximately $100 million. Pre-cash flow for 2023 was $577 million versus a use of $9 million last year.

For 2024, we anticipate capital expenditures to be approximately 235 million to $250 million.

We spent $113 million on renewals of our television distribution contracts in 2023.

Our TV distribution payments can fluctuate year over year, depending on renewal cycles. So we continue to expect the two year average to be approximately $100 million.

Free cash flow for 2023 was $577 million versus.

Versus a use of $9 million last year.

Bill Wofford: The year-over-year improvement was attributable to increased cash flow from operations driven by working capital improvements in the front half of the year and higher earnings in the back half of the year. [inaudible] We continue to expect higher adjusted OIVDA to benefit free cash flow in 2024, based on our debt profile. We repaid $138 million net on the revolver in the fourth quarter. Net debt at Curate Retail Group reduced $209 million in the fourth quarter from the revolver paydown and strong cash generation.

The year over year improvement was attributable to increased cash flow from operations driven by working capital improvements in the front half of the year and higher earnings in the back half of the year. This.

Shane Kleinstein: This is partially offset by higher TV distribution payments year-over-year. We continue to expect higher adjusted OIBDA to benefit free cash flow in 2024. Looking at our debt profile, we repaid $138 million net on the revolver in the fourth quarter. Net debt at Qurate Retail Group reduced $209 million in the fourth quarter from the revolver paydown and strong cash generation. As of 31 December, we had $857 million drawn on the QVC revolver with $2.3 billion in available capacity. In terms of cash balances, as of 31 December 2023, Qurate Retail had total cash of $1.1 billion, of which $307 million was at QVC Inc., $453 million was at Liberty Interactive, and $275 million was at Qurate Retail Inc. Our leverage ratio, as defined by the QVC revolving credit facility, was 2.4 times. Note that covenant OIBDA includes the adjusted OIBDA of QVC Inc.

Bill Wafford: This is partially offset by higher TV distribution payments year-over-year. We continue to expect higher adjusted OIBDA to benefit free cash flow in 2024. Looking at our debt profile, we repaid $138 million net on the revolver in the fourth quarter. Net debt at Qurate Retail Group reduced $209 million in the fourth quarter from the revolver paydown and strong cash generation. As of 31 December, we had $857 million drawn on the QVC revolver with $2.3 billion in available capacity. In terms of cash balances, as of 31 December 2023, Qurate Retail had total cash of $1.1 billion, of which $307 million was at QVC Inc., $453 million was at Liberty Interactive, and $275 million was at Qurate Retail Inc. Our leverage ratio, as defined by the QVC revolving credit facility, was 2.4 times. Note that covenant OIBDA includes the adjusted OIBDA of QVC Inc.

This was partially offset by higher TV distribution payments year over year.

We continue to expect higher adjusted OIBDA benefit free cash flow in 2024.

Looking at our debt profile.

We repaid $138 million.

Net on the revolver in the fourth quarter.

Net debt at <unk> retail group reduced $209 million in the fourth quarter from the revolver Paydown and strong cash generation.

As of December 31, we had $857 million drawn on the QVC revolver with $2 3 billion in available capacity in.

Bill Wofford: As of December 31st, we had $857 million drawn on the QVC revolver with $2.3 billion in available capacity. In terms of cash balances, as of December 31, 2023, Curate Retail had total cash of $1.1 billion, of which $307 million was at QVC Inc., $453 million was at Liberty Interactive, and $275 million was at Curate Retail Inc. Our leverage ratio, as defined by the QVC Revolving Credit Facility, was Note that Covenant OEBDA includes the adjusted OEBDA of QVC Inc. and Cornerstone, gains from the sale leaseback transactions completed in the last 12 months, and a portion of projected cost savings. Note that we delivered a redemption notice yesterday to redeem all remaining outstanding QVC 4.85% senior secured notes due in 2024 on March 28th, which we will fund with cash and revolver capacity.

In terms of cash balances as of December 31, 2023 through eight retail had total cash of $1 1 billion.

Of which $307 million at QVC, Inc. $453 million was it Liberty interactive.

$275 million of security retailing.

Our leverage ratio as defined by QVC QVC revolving credit facility was two four times.

Note that covenant OIBDA includes the adjusted OIBDA QVC, Inc, and cornerstone gains from the sale leaseback transactions completed in the last 12 months and a portion of projected cost savings.

Shane Kleinstein: and Cornerstone, gains from the sale-leaseback transactions completed in the last 12 months, and a portion of projected cost savings. Note that we delivered a redemption notice yesterday to redeem all remaining outstanding QVC 4.85% Senior Secured Notes due on 28 March 2024, which we will fund with cash and revolver capacity. In 2022 and 2023, we executed programs to increase our liquidity and position ourselves for the successful implementation of our transformation plan. We affirm that our debt level is manageable and our current cushion is sufficient in relation to our 4.5x maximum net leverage covenant threshold stipulated in our credit facility. In 2023, we made substantial progress in the execution of our transformation initiatives, and Q3's second-half results are a measure of our progress. We look forward to building on this momentum in 2024. Now, with that, I'll turn the call over to Greg.

Bill Wafford: and Cornerstone, gains from the sale-leaseback transactions completed in the last 12 months, and a portion of projected cost savings. Note that we delivered a redemption notice yesterday to redeem all remaining outstanding QVC 4.85% Senior Secured Notes due on 28 March 2024, which we will fund with cash and revolver capacity. In 2022 and 2023, we executed programs to increase our liquidity and position ourselves for the successful implementation of our transformation plan. We affirm that our debt level is manageable and our current cushion is sufficient in relation to our 4.5x maximum net leverage covenant threshold stipulated in our credit facility. In 2023, we made substantial progress in the execution of our transformation initiatives, and Q3's second-half results are a measure of our progress. We look forward to building on this momentum in 2024. Now, with that, I'll turn the call over to Greg.

Note that we delivered a redemption notice yesterday to redeem all remaining outstanding QVC for eight 5% senior secured notes due in 2024 on March 28, which we will fund with cash and revolver capacity.

In 2022, and 2023, we executed programs to increase our liquidity and position ourselves for the successful implementation of our transformation plan we.

We affirm that our debt level is manageable and our current cushion is sufficient in relation to our four five times maximum net leverage covenant threshold stipulated in our credit facility.

Bill Wofford: In 2022 and 2023, we executed programs to increase our liquidity and position ourselves for the successful implementation of our transformation plan. We affirmed that our debt level is manageable, and our current cushion is sufficient in relation to our 4.5 times maximum net leverage covenant threshold stipulated in our credit facility. In 2023, we made substantial progress in the execution of our transformation initiatives, and Curate's second-half results are a measure of our progress. We look forward to building on this momentum in 2024. Now, with that, I'll turn the call over to Greg.

In 2023, we made substantial progress in the execution of our transformation initiatives and curates second half results are a measure of our progress we look forward to building on this momentum in 2024 now.

Now with that I'll turn the call over to Greg.

Greg Maffei: Thanks, Bill. A successful 2023 has been demonstrated by improved financial performance and business health. The second half of 2023 was a turning point as Athens took hold. We saw enhanced merchandising and pricing strategy. We also saw efficiencies in the fulfillment center post our fire, elevated costs, as well as other administrative costs that were taken out of the business. All of these drove significant Adjusted OIBDA growth in the second half with $586 million of growth in cash flow year-over-year. We also positioned the business for the future with multi-platform and digital strategies that will begin to take hold. We also continue to improve the balance sheet, reducing approximately $1 billion of debt in 2023 and lowering the revolver balance by $218 million, including $138 million in the fourth quarter. We will continue to assess incremental opportunities to improve the balance sheet.

Thanks Bill.

Successful 2023 has been demonstrated on improved financial performance and business helps.

For the second half of 2023 was a turning point is absent took hold.

<unk> enhanced merchandising and pricing strategy. We also saw efficiencies in the fulfillment center post our fire.

Elevated costs.

As well as other administrative costs that were taken out of the business. All of these drove significant adjusted OIBDA growth in the second half.

Greg Maffei: Thanks, Bill. A successful 2023. Demonstrated improved financial performance and business health. The second half of 2023 was a turning point as Aspen took hold. We saw enhanced merchandising and pricing strategies. We also saw efficiencies in the fulfillment center post our fire elevated costs, as well as other administrative costs that we're taking out of the business. All of these drove significant adjusted oivid growth in the second half, with 586 million of growth in cash flow year over year.

With $586 million of growth in cash flow year over year.

We also position the business for future the future with multi platform and digital strategies that will begin to take hold.

We also continue to improve the balance sheet, reducing approximately $1 billion of debt in 2023, lowering the revolver balance by $218 million, including 138 million in the fourth quarter, we will continue to assess incremental opportunities to improve the balance sheet.

Greg Maffei: We did deliver a notice to redeem the outstanding 2024 Senior Secured Notes using cash on hand and our Revolver capacity. We expect to continue to build momentum on these successes in 2024. And with that, I'll open it up for Q&A, operator.

We did deliver on notice to redeem the outstanding 2024, senior secured notes using cash on hand, and our revolver capacity.

We expect to continue to build momentum on these successes in 2024 and with that I'll open it up for Q&A operator.

Greg Maffei: We also position the business for the future with multi-platform and digital strategies that will begin... We also continue to improve the balance sheet, reducing approximately $1 billion of debt in 2023 and lowering the revolver balance by $218 million, including $138 million in the fourth quarter. We will continue to assess incremental opportunities to improve the balance sheet. We did deliver a notice to redeem the outstanding 2024 Senior Secured Notes using cash on hand and our revolver capacity. We expect to continue to build momentum on these successes. [inaudible] Thank you.

Operator: Thank you. Ladies and gentlemen, we will now be conducting a question and answer session. If you would like to ask a question, please press star and one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions. Our first question is from Jason Bazinet with Citi. Please go ahead.

Thank you.

Ladies and gentlemen, we will now be conducting a question and answer session.

If you would like to ask a question. Please press star and one on your telephone keypad.

A confirmation tone will indicate your line is in the question queue.

You May press Star and Jill if you would like to remove your question from the queue.

For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Ladies and gentlemen, we will wait for a moment widely poll for questions.

Operator: Ladies and gentlemen, we will now be conducting a question and answer session. If you would like to ask a question, please press star and 1 on your telephone keypad. A confirmation tone will indicate your line is in the queue. You may press star and 2 if you would like to remove your question from the queue.

Our first question from Jason Bazinet with Citi. Please go ahead.

Jason Bazinet: Thanks. I just had a high-level question. I guess for 2024, I think it's reasonable to anticipate revenues may not grow, but the ASTN savings will sort of come in and allow you to grow even on 2024. Is the high-level vision by the time you get to 2025, the top line should be stable or growing, or do you think it's more likely you'll still have some top line pressures, but there's additional costs as we move into to come out as we move into 2025? Thanks.

Thanks, I just had a high level question I guess for 'twenty four.

I think I think it's reasonable.

Anticipated revenues.

May not grow, but the app and savings will sort of come in and allow you to grow EBITDA in 'twenty four is the high level vision by the time you get to 25, the top line should be stable or growing or do you think it's more likely you'll still have some topline pressures, but there's additional costs as we move in.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the start button. Ladies and gentlemen, we will wait for a moment while we poll you for questions. Our first question is from Jason Bazinet with Citi. Please go ahead. Thanks. I just had a high-level question, I guess for 24, it may not grow, but the Athens savings will sort of come in and allow you to grow even down 24. Is the high-level vision that by the time you get to 25, the top line should be stable or growing? More likely, you'll still have some top line pressures, but there will be additional costs as we move into, and to come out as we move into 2025. Hello, thank you for the thoughtful question.

To come out as we move into 'twenty five.

David Rawlinson: Hello. Thank you for the thoughtful question. As we go through 2024 into 2025, I think we move into a more well-balanced top and bottom line growth story. It would certainly be the case if we targeted stability very intentionally, both on top line revenue and stability in terms of customer fall through the Project Athens period through 2024, as you correctly point out. I think we're setting up after 2024 to have a more balanced path to value creation on both the top and bottom line, and so preparing to be able to grow in the out years after the Project Athens period.

Hello, Thank you for the thoughtful question.

As we go through 'twenty four 'twenty five I think we move into a more well balanced top and bottom line.

Growth story it.

It would certainly be the case, if we targeted stability very intentionally both on on topline revenue and stability in terms of customer file through the project debt and spirit through 2024 as you correctly point out I think we're setting up after 2024 to have.

More balanced path to value creation on both the top and bottom line and so prepare.

Operator: As we go through 2024 and 2025, I think we will move into a more well-balanced top and bottom line growth story. That would certainly be the case if we targeted stability very intentionally, both on top line revenue and stability in terms of customer fall through the Project Athens period through 2024. As you correctly point out, I think we're setting up after 2024 to have a more balanced path to value creation on both the top and bottom lines and so preparing to be able to grow in the out years after the project. Okay, can I just ask one follow-up? You mentioned the focus on the garden in the UK and the kitchen in Germany.

Preparing to be able to grow in the out years after the project guidance period.

Jason Bazinet: Okay. Can I just ask one follow-up? You mentioned the focus on garden in the UK and kitchen in Germany, but are there any other things that are causing sort of the more positive results coming out of the international markets relative to the US? I mean, you're making progress on both, but you sort of slipped into growth mode on a constant currency basis and international. Can you just talk a little bit more about that dichotomy?

Okay can I just ask one follow up.

You mentioned the focus on garden in the UK and kitchen in Germany, but are there any other things that are causing sort of that.

Good morning.

Positive results coming out of the international markets relative to the U S. I mean, youre, making progress on both but you sort of slipped into growth mode.

All right.

On a constant currency basis and international can you just talk a little bit more about that dichotomy.

David Rawlinson: Yeah, sure. I think I'd say two things. One, there tend to be less competitive markets, both digital and the digital new customer acquisition space, and so we've taken advantage of that. They also tend to be more stable linear TV markets, less cord cutting in those markets. And there's been slightly more, I'd say, on average across all the markets we operate in, slightly more consistent consumer behavior to navigate. I also think we're in the right footprint in the right countries, and we have very stable, well-tuned management teams who have done a nice job of operating those businesses. I think if you look historically, the international businesses have generally grown a little bit faster in terms of revenue than the US business. That is in part just due to some beneficial competitive environments.

Yes, sure I think.

I'd say two things.

One there.

David Rollinson: But are there any other things that are causing sort of the more positive results coming out of the international markets relative to the US? I mean, you're making progress on both, but you sort of slipped into growth mode on a constant currency basis, and can you just talk a little bit more about that? Yeah, sure. I think I'd say two things.

Tend to be less competitive markets.

Digital.

And the digital new customer acquisition space and so we've taken advantage of that they also tend to be more stable linear television markets less cord cutting.

In those in those markets.

And.

There has been slightly more I would say on an average across all the markets we operate in.

Slightly more consistent consumer behavior to navigate I also think we have.

David Rollinson: One, there tend to be less competitive markets, both digital and the digital new customer acquisition space. And so we've taken advantage of that. They also tend to be more stable linear TV markets, with less cord cutting in those markets.

We are in the right footprint and the right cut.

Countries and we have.

Very stable well tuned management teams, who have done a nice job of of operating those businesses I think if you look historically the international businesses and generally grow.

David Rollinson: And there's been slightly more, I'd say, on average across all the markets we operate in, slightly more consistent consumer behavior to navigate. I also think we have the right footprint in the right countries, and we have very stable, well-tuned management teams who have done a nice job of operating those businesses. I think if you look historically, international businesses have generally grown a little bit faster in terms of revenue than U.S. businesses.

A little bit faster in terms of revenue than the U S business that is in part due to some beneficial competitive.

Environment, and so I think youll continue to see strong performance out of our international businesses, we really like our footprint and we like the dynamics in most of those countries.

David Rawlinson: And so I think you'll continue to see strong performance out of our international businesses. We really like our footprint, and we like the dynamics in most of those countries.

Jason Bazinet: Thank you. Thank you.

David Rollinson: That is in part just due to some beneficial competitive environments. And so I think you'll continue to see strong performance out of our international businesses. We really like our footprint, and we like the dynamics in most of it. Thank you. Our next question is from William Reuter with Bank of America. Please go ahead. Good morning. I have two.

Thank you. Thank you.

Operator: Thank you. Our next question is from William Reuter with Bank of America. Please go ahead.

Thank you.

Our next question is from William Reuter with Bank of America. Please go ahead.

William Reuter: Good morning. I have two. So the first is you mentioned that you have been able to shift some of your product offering. Clearly, electronics is really weak, and you have some pockets of strength in the US accessories and apparel. I guess, is there any way you can quantify what amount of programming has been shifted to categories of strength and the opportunity to continue to do that in 2024?

Good morning, I have two so the first is you mentioned that you have been able to shift.

David Rollinson: So the first is, you mentioned that you have been able to shift some of your product offering. Clearly, electronics is really weak, and you have some pockets of strength, like in the U.S., accessories, and apparel. I guess, is there any way you can quantify how much programming has been shifted to categories of strength and the opportunity to continue to do that in 24? Yeah, it's a great question.

Some of your product offering clearly electronics is really weak and you have some pockets of strength in the U S accessories.

In apparel I guess is there any way you can quantify what amount of programming has been shifted to categories of strength and the opportunity to continue to do that in 'twenty four.

David Rawlinson: Yeah. It's a great question. So we have made shifts. I won't speak in specific numbers, but if you look at our on-air airtime, our most valuable live airtime, we gave more to jewelry, more to beauty, less to electronics, a slight increase in apparel. And I think those those tended to be the biggest moves in the quarter, fashion apparel and jewelry being the biggest increases and consumer electronics being the biggest decrease in terms of airtime.

Yes, it's a great question. So we have made shifts.

David Rollinson: So, we have made shifts. I won't speak in specific numbers, but if you look at our own airtime, our most valuable live airtime, we gave more to jewelry, more to beauty, less to electronics, and a slight increase in apparel. And I think those tended to be the biggest moves in the quarter, fashion apparel and jewelry being the biggest increases, and consumer electronics being the biggest decrease in terms.

Speaking.

Given specific numbers, but if you look at our own air airtime. Our most valuable laws are times, we gave more to dual rate more to beauty.

Last two electronics, a slight increase in apparel and I think those were our.

Those tended to be the biggest moves.

In the quarter.

In apparel.

Jewelry being the biggest increases and consumer electronics being the biggest decrease in terms of airtime.

William Reuter: Okay. And then my second question, on the third-quarter call, you mentioned you expected to repay both the 2024s and 2025s with cash or revolver drawings. Is that continuing to be the case? And kind of relatedly, towards the end of the prepared remarks, you talked about taking advantage or continuing to pursue opportunistic, it sounded like, asset sales or transactions that would bring in cash. Is there anything active going on there, and do you expect that there will be transactions of that like this year?

David Rollinson: Okay, and then my second question. On the third quarter call, you mentioned you expected to repay both the 24s and 25s with cash or revolver drawings. Is that continuing to be the case and, kind of relatedly, towards the end of the prepared remarks, you talked about taking advantage of or continuing to pursue opportunistic opportunities. It sounded like asset sales or transactions that would bring in cash. Is there anything active going on there, and do you expect that there will be transactions of that nature like this year? So, we expect, you know, we'll do the 24s, you know, in expectation of 25s, the combination of cash on hand and revolver capacity. We don't anticipate any material transactions similar to what you saw in 2022 with sale-respect activity or anything of that ilk. Perfect. That's all for me.

Okay and then my second question on the third.

Third quarter call. You mentioned, you expect it to repay both the 'twenty four and 'twenty fives with cash or revolver drawings is that continuing to be the case and kind of relatedly towards the end of the prepared remarks, you talked about.

Taking advantage of our continuing to pursue opportunistic it sounded like asset sales or transactions that would bring in cash.

Is there anything active going on there and do you expect that there will be transactions of that like this year.

David Rawlinson: So we expect we'll do the 2024s in expectation of the 2025s, the combination of cash on hand and revolver capacity. We don't anticipate any material transactions similar to what you saw in 2022 with sale-leaseback activity or anything of that ilk.

Bill Wafford: So we expect we'll do the 2024s in expectation of the 2025s, the combination of cash on hand and revolver capacity. We don't anticipate any material transactions similar to what you saw in 2022 with sale-leaseback activity or anything of that ilk.

So.

We expect we will do the 20 fours and an expectation of 25%.

The combination of cash on hand, and revolver capacity, we don't we don't anticipate any material transactions similar to what you saw in 2022 with sale leaseback activity or anything of that ilk.

William Reuter: Perfect. That's all for me. Thank you.

Perfect. That's all for me thank you.

Bill Wofford: Thank you. Thank you. Our next question is from Carla Casella with J.P. Morgan. Please go ahead.

Operator: Thank you. Our next question is from Carla Casella with JPMorgan. Please go ahead.

Thank you.

Our next question from Carla Casella.

J P. Morgan. Please go ahead.

Bill Wofford: Great, thank you. One follow-up to Bill's question: can you just remind us how much owned property you still have and whether it's domestic or international? We still have obviously the facility in St. Pete and then other, you know, kind of smaller international facilities as well in Japan, the UK, and so on, and also in terms of distribution centers in the U.S., but nothing that we're considering monetizing in the near term. Okay, and then we'd like to see the new customer counts increase sequentially for the first time since the pandemic. What does that tell us about the existing customer and the other baskets? Do you see the conversion of new customers into existing at a different rate than in the past? Any more color you can give us there?

Carla Casella: Great. Thank you. One follow-up on Bill's question. Can you just remind us how much owned property you still have and whether it's domestic or international?

Great. Thank you one follow up on Bill's question can you just remind us how much owned property you still have in whether it's domestic or international.

David Rawlinson: Hey, Carla. This is Bill. Obviously, we still have, obviously, the facility in St. Pete and then other kind of smaller international facilities as well in Japan, UK, and so on, and then also in terms of distribution centers in the US, but nothing that we're considering monetizing in the near term.

Bill Wafford: Hey, Carla. This is Bill. Obviously, we still have, obviously, the facility in St. Pete and then other kind of smaller international facilities as well in Japan, UK, and so on, and then also in terms of distribution centers in the US, but nothing that we're considering monetizing in the near term.

Hey, Carl this is bill.

Obviously, we still have obviously the facility in St. Pete and then other kind of smaller international facilities as well in Japan, and UK and so on.

The majority and then also in terms of distribution centers in the U S. But nothing that we're considering monetizing in the near term.

Carla Casella: Okay. And then we'd like to see that the new customer counts increased sequentially for, I think, the first time since the pandemic. What does that tell us about the customer existing and the other baskets? Are you seeing the conversion of new into existing at a different rate than in the past? Any more color you can give us there?

Okay.

And then we'd like to see that the new customer counts increased sequentially for I think it's the first time.

Since the pandemic.

What does that tell us about the customer existing in the you know the other baskets does that are you seeing conversion of new into existing and a different rate than in the past and to any more color you can give us there.

David Rollinson: Yeah, great question. You're right. This is the first time we've grown customers and new customers in a number of years. I would say it's too early to know exactly what that batch is going to be. One of the things that we track very carefully is purchase and repurchase rates across time. We find that to be a highly correlated predictor of customer quality over the life of the customer. And I would say anytime you increase the population of new customers, you change the mix of quality a little bit. And so we've seen some changes in the mix, but on the whole, we're seeing that this group of customers is about the same, and shows about the same attributes as previous crops of customers, especially when we've grown new customers. So they're a little more digital, they're finding us across our platforms, and so it is a customer that's sort of the next generation of customers.

David Rawlinson: Yeah. Great question. You're right that this is the first time we've grown customers and new customers in a number of years. I would say it's too early to know exactly what that batch is going to be. One of the things that we track very carefully is purchase and repurchase rates across time. We find that to be a highly correlated predictor of customer quality over the life of the customer. And I would say anytime you increase the population of new customers, you change the mix of quality a little bit. And so we've seen some changes in mix, but on the whole, we're seeing that this group of customers is about the same, shows about the same attributes as previous crops of customers, especially when we've grown new customers. So they're a little more digital. They're finding us across our platforms.

Yes, great question.

You are right. This is the first time, we've grown customers and new customers and a number of years I would say, it's too early to know exactly.

What that batches is going to be one of the things that we track very carefully is.

Purchase and repurchase rates across time, we found that to be a highly correlated predictor of customer quality over the life of the customer and I would say anytime you increase the population of new customers you change the mix of quality a little bit.

And so we've seen some changes in mix, but.

On the whole we are seeing that this group of customers is.

About the same shows about the same attributes.

As previous crops of customers, especially when we have grown new customers.

So they are a little more.

Digital they are finding us across our platforms and so it is a customer that's.

David Rawlinson: And so it is a customer that's sort of the next generation of customers. I think one of the things we're really pleased about is we think it continues to show the relevance of our platform, and that we continue to be attractive to new customers. I think, looking at the data we see so far for the current crop of customers, we are optimistic about our ability to continue graduating those customers into becoming avid, elite, and eventually best customers at about the same rate as what we've done previously.

Sort of the next generation of customers I think what are the things. We're really pleased about is we think it continues to show the relevance of our platform.

David Rollinson: I think one of the things we're really pleased about is that we think it continues to show the relevance of our platform and that we continue to be attractive to new customers. I think looking at the data we see so far for the current crop of customers, we are optimistic about our ability to continue graduating those customers into becoming avid and elite and eventually best customers at about the same rate as what we've done previously. Okay, great. And then there was one question. I was looking back through some older presentations from pre-pandemic, and you had talked about inventory, exposure of your inventory, and that some of it, you've done a great job reducing inventory lately, but I'm also, I think your inventory risk might actually be lower than it looks, uh, looks like, because don't you give the ability to return inventory to vendors in some cases, and how should we think about inventory at risk? versus the balance sheet. No, no, a good question, Carla.

And that we continue to be attractive to new customers I think at looking at the data we see so far for the current crop of customers. We are optimistic about our ability to continue graduating those customers into becoming Abbott and alere and eventually best customers at <unk>.

At the same rate as what we've done previously.

Carla Casella: Okay. Great. Then one question. I was looking back through some older presentations from pre-pandemic, and you had talked about inventory, exposure of your inventory, and that some of it you've done a great job reducing inventory lately. But I think it's actually your inventory risk might be actually lower than it looks like because do you have the ability to return inventory to vendors in some cases? And how should we think about inventory at risk versus the balance sheet?

Okay, Great and then one question I was looking back through some older presentations from pre pandemic.

You talked about inventory.

The exposure of your inventory and then some of the you've done a great job of reducing inventory lately, but I'm also I think it's the accident your inventory risk might be actually lower than it looks.

It looks like because.

Do you have the ability to return inventory to vendors.

In some cases and how should we think about inventory at risk versus yes.

Bill Wofford: I think, you know, from the structure of our agreements with our vendors, our risk profile on inventory is significantly less than it was for a couple of reasons. We reduced our days of supply significantly and to a more manageable rate that you would think for a retail level of revenue would be more commensurate with a, you know, an appropriate level of turnover. Two, a large percentage of our inventory, our sales, you know, revenue, our customers are driven via drop ship, especially in the U.S. So it comes straight from the vendor, and the inventory is never on our balance sheet. And then third, depending on the structure of the vendor, there are times when we do have, when we have a returned item, we have the ability to return that to the vendor, and so it minimizes inventory exposure on those products as well. Okay, great. And then just one last one.

David Rawlinson: Yeah. No, no. Good question, Carla. I think from the structure of our agreements with our vendors, our risk profile on inventory is significantly less than it was for a couple of reasons. We reduced our days of supply significantly into a more manageable rate that you would think for a retailer level of revenue would be more commensurate with an appropriate level of turnover. Two, a large percentage of our inventory or sales revenue to our customers is driven via dropship, especially in the US. So coming straight from the vendor, and the inventory is never on our balance sheet. And then third, depending on kind of the structure with the vendor, there are times when we do have a returned item that we have the ability to return that to the vendor, and so it minimizes inventory exposure on those products as well.

Bill Wafford: Yeah. No, no. Good question, Carla. I think from the structure of our agreements with our vendors, our risk profile on inventory is significantly less than it was for a couple of reasons. We reduced our days of supply significantly into a more manageable rate that you would think for a retailer level of revenue would be more commensurate with an appropriate level of turnover. Two, a large percentage of our inventory or sales revenue to our customers is driven via dropship, especially in the US. So coming straight from the vendor, and the inventory is never on our balance sheet. And then third, depending on kind of the structure with the vendor, there are times when we do have a returned item that we have the ability to return that to the vendor, and so it minimizes inventory exposure on those products as well.

No no. Good question Carlos I think from the structure of our agreement so that our vendors and our risk profile on inventory significantly less than it was for a couple of reasons, we reduced our days of supply significantly and to a more manageable rate that you would think for a retailer with a level of revenue would be more commensurate with.

An appropriate level of turnover to a large percentage of our inventory or sales revenue. Our customers is driven via drop ship, especially in the U S. So coming straight from the vendor and the inventory number on our balance sheet and then third with on depending on kind of the structure of the vendor. There are times. When we do have when we have a returned item that we have the ability to return that to the vendor.

And so a minimized inventory exposure from the on those products as well.

Carla Casella: Okay. Great. And then just one last one. Do you ship anything through the Red Sea, and are you seeing any impact there?

Okay, Great and then just one last one are you do you take do you ship anything to the Red Sea and are you seeing any impact.

David Rollinson: Do you ship anything to the Red Sea, and are you seeing any impact there? Yes, we do ship through the Red Sea. About 15% of our QVC US and HSN volume goes through the Suez Canal. We've transitioned to some other vessel services to try to avoid the area. So in the US, and in our largest businesses, we haven't seen a very big impact, and we think our exposure is relatively limited. In Europe, we do have more exposure.

David Rawlinson: Yes. We do ship through the Red Sea. About 15% of our QVC US and HSN volume goes through the Suez Canal. We've transitioned to some other vessel services to try to avoid the area. So in the US and our largest businesses, we haven't seen a very big impact, and we think our exposure is relatively limited. In Europe, we do have more exposure. About 75% of our supply goes through the canal. We've experienced a delay in receiving some shipments, 10, 12 days, something in there. We've had a couple of shifts of our Today's Special Value, about, I think, 3 or 4 in January, and we have started to see higher costs for ocean containers. I would say none of these are nearly at the level of pain that we experienced during the pandemic.

Yes, we we do shift through the Red Sea about 15% of our QVC U S and HSN volume goes through the Suez Canal, we've transitioned to some other vessels services to try to avoid the area. So so in the U S. In our largest businesses we haven't.

<unk>, a very big impact and we think our exposure is relatively limited in Europe, we do have more exposure of about 75% of our supply.

David Rollinson: About 75% of our supply goes through the canal. We've experienced a delay in receiving some shipments, you know, 10, 12 days, something like that. We've had a couple of shifts in our Today's Special value, about, I think, 3 or 4 in January, and we have started to see higher costs for ocean containers. I would say none of these are nearly at the level of pain that we experienced during the pandemic.

Goes through the canal.

Experience a delay in receiving some shipments 10 12 days something in there we've had a couple of shifts of our today's special value about I think three or four in January and we have started to see higher costs for ocean.

Containers.

I would say none of these are nearly at the level of pain that we experienced doing.

The pandemic, it's very manageable to day in terms of the disruption to our Europe operations, but they have seen some small effects.

David Rawlinson: It's very manageable today in terms of the disruption to our Europe operations, but they have seen some small effects.

Bill Wofford: It's very manageable today in terms of the disruption to our European operations, but they have seen some small effects. Okay, sorry, one more somewhat related to that as well. Are China terrorists? We're seeing more press on that.

Carla Casella: Okay. And just, sorry, one more somewhat related to that as well. Our China tariffs, we're seeing more press on that. How would that impact you, and is that something you're watching as a potential risk?

Okay, and just sorry, one more.

Somewhat related to that as well.

Our China tariffs.

David Rollinson: How would that impact you, and is that something you're watching as a potential risk? Carl, I would say we're always obviously cognizant of that. We haven't seen any significant uptick, you know, right now. Our teams, our procurement teams, are pretty in-tuned in terms of kind of how we think about, you know, timeline of procurement and, you know, source of supply, but that has not yet impacted us, nor do we anticipate at any time in the near future having a significant impact on markets. We know. We know that. Yeah, we don't think we will. Go ahead, I'm sorry.

We see more press on that how would that impact you and is that something youre watching has that potential risk.

David Rawlinson: Carla, I would say we're always, obviously, cognizant of that. We haven't seen any significant uptick right now. Our procurement teams are pretty in tune in terms of kind of how we think about timeline of procurement and source of supply, but that has not yet impacted us, nor do we anticipate at any time in the near future having a significant impact to margin. Yeah. We don't think that.

Bill Wafford: Carla, I would say we're always, obviously, cognizant of that. We haven't seen any significant uptick right now. Our procurement teams are pretty in tune in terms of kind of how we think about timeline of procurement and source of supply, but that has not yet impacted us, nor do we anticipate at any time in the near future having a significant impact to margin. Yeah. We don't think that.

Karla.

We're always obviously cognizant of that and we haven't seen any significant uptick right now.

Our teams our procurement teams are pretty in tune in terms of kind of how we think about timeline of procurement.

Source of supply.

But that has not yet impacted us nor do we anticipate anytime in the near future, having a significant impact on margins, yes, we don't we don't mind.

Carla Casella: I guess one more.

David Rawlinson: Yeah. We don't see.

Yes, we don't see.

Carla Casella: Oh, I'm sorry.

David Rawlinson: We don't.

Carla Casella: Go ahead. I'm sorry. I was going to say I was trying to how much of your goods come from China today versus the last time this was an issue or pre-pandemic?

Go ahead I'm sorry.

Bill Wofford: I was going to say, how much of your goods come from China today versus the last time this was an issue or pre-pandemic? Yeah, we've diversified the supply chain since the pandemic. We're less reliant on China than we were a few years ago.

I would just add with China, how much of your goods come from China today versus the last time this was that an issue or pre pandemic.

David Rawlinson: Yeah. We've diversified the supply chain since the pandemic. We're less reliant on China than we were a few years ago. We can get back to you with some high-level stats on supply. I think we've provided that in the past, and we can sort of update that for you, Carla.

Yes, we've diversified the.

The supply chain since the pandemic, we're less reliant on.

China than we were a few years ago, we can get back to you with some high level stats on on <unk>.

Bill Wofford: We can get back to you with some high-level stats on supply. I think we've provided that in the past, and we can sort of update that for you. Okay, great.

Supply I think we provided that in the past and we can sort of update that for you.

Carla Casella: Okay. Great. Thank you.

Okay, great. Thank you.

Bill Wofford: Thank you. Thank you. Our next question is from the line of Hale Holden with Barclays. Please go ahead.

Okay.

Operator: Thank you. Our next question is from the line of Hale Holden with Barclays. Please go ahead.

Thank you.

Our next question is from the line of Hale Holden with Barclays. Please go ahead.

David Rollinson: Thank you. David, you sort of left the door open to growing subscribers in 2025, and I was wondering if you could sort of help us bridge from where we are to how we get there and maybe a little bit more color on your confidence in that. Yeah, it's a great question.

Hale Holden: Thank you. David, you sort of left the door open to grow subscribers in 2025, and I was wondering if you could sort of help us bridge from where we are to how we get there and maybe a little bit more color on your confidence on it?

Thank you Tim you sort of left the door open to grow subscribers in 2025.

And I was wondering if you could just sort of help us bridge from where we are and how we got there and maybe a little bit more color on your confidence on it.

David Rawlinson: Yeah. It's a great question. I talked about our streaming service, which is growing quickly and is already about 5% of a minute's viewed, so I think that'll be part of it. I think you see in our linear service continuing stabilization around ±8 million customer mark, and then our growing new customers with that service and digitally is what you see in the new customer numbers. And so it's a combination of relative stability and existing customers, relative stability and reactivated customers year over year, and then driving growth through growth of new customer acquisition, growth of the streaming services, and then growth of people watching content across other non-owned platforms.

Yes. It is.

Great question.

David Rollinson: I talked about our streaming service, which is growing quickly and is already about 5% of the minutes viewed. So I think that'll be part of it. I think you see in our linear service, continuing stabilization around plus or minus the 8 million customer mark, and then our growing new customers with that service and digitally is what you see in the new customer numbers. And so it's a combination of relative stability and existing customers, relative stability and reactivated customers year over year, and then driving growth through growth of new customer acquisition, growth of the streaming services, and then growth of people watching content across other non- Great, thank you. And then, just as a second question, the TV distribution rights for $113 million.

I talked about our streaming service switches.

Growing quick.

Quickly and is already about 5% of our minutes viewed so I think that'll be part of it I think you see in our linear service.

We continue.

Continue continuing stabilization around plus or minus the $8 million customer.

Mark and then.

Our growing new customers with that service and digitally is what you see and.

New customer numbers and so it's a combination of.

Relative stability and existing customers relative stability and reactivated customers year over year, and then driving growth through growth of new customer acquisition growth of the streaming.

Services and then growth.

People are watching content across other non owned platforms.

Hale Holden: Great. Thank you. And then just as a second question, the TV distribution rights of $113 million. In 2023, if we're averaging $100 million over two years, is the expectation in 2024 that they're pretty de minimis?

Great. Thank you and then.

Yes.

Second question for TV distribution rates of $113 million.

Bill Wofford: In 23, if we're averaging $100 million over two years, is the expectation in 24 that they're pretty de minimis? Uh, I mean, I would not say de minimis, but I mean, I think on the average of that, we should, you know, you'll see, less than we were in 20. Okay, thank you.

23, if we're averaging $100 million over two years is the expectation of 24 that theyre pretty de Minimis.

David Rawlinson: I mean, I would not say de minimis, but I mean, I think on the average of that, you'll see less than we were in 2023.

Bill Wafford: I mean, I would not say de minimis, but I mean, I think on the average of that, you'll see less than we were in 2023.

I mean, I would not say de minimis, but I mean, I think on the average of that we should youll see less than we were in country.

Hale Holden: Okay. Thank you.

Okay. Thank you.

Bill Wofford: Thank you. Ladies and gentlemen, we take the last question from the line of Karu Martinson with Jefferies. Please go ahead. Good morning.

Operator: Thank you. Ladies and gentlemen, we take the last question from the line of Karru Martinson with Jefferies. Please go ahead.

Thank you.

Ladies and gentlemen, we take the last question from the line of paddle Martinsen with Jefferies. Please go ahead.

Karru Martinson: Good morning. When we look at the 3% price increase in Q4 and kind of carry that forward, what's our expectation for the ability to take price in 2024?

Good morning.

David Rollinson: When we look at the 3% price increase in the fourth quarter and kind of carry that forward, what's our expectation for the ability to take prices in 2024? Great question. I think we still believe we have some ability to take price, but we were late in the cycle of taking prices. I think a lot of other retailers took prices before we did, but I think we took them a little bit later in the cycle. But we think we still have some ability to take prices.

When we look at the 3% price increase in the fourth quarter and kind of carry that forward, what's your expectation for the ability to take price in 2024.

David Rawlinson: Yeah. Great question. I think we still believe we have some ability to take price. We were late in the cycle of taking price. I think a lot of other retailers took price before we did. I think we took it a little bit later in the cycle. So we think we still have some ability to take price. More importantly, I would say we believe we still have the ability to drive some increases in average sale price because we've been lifting the level of quality of our assortment and our merchandise. So when you see the price, I would think both in terms of some of it's taking price and some of it's a change in mix of the pricing level of the merchandise we're bringing in. I would also point out that we've had a headwind as electronics has gone down.

Yeah, Great question I think we still believe we have some ability to take price.

We were late in the cycle of taking price I think a lot of other retailers took price before we did I think we took a little bit later in the cycle.

But we think we still have some ability to take price more importantly, I would say we believe we still have the ability to drive some increases in average sale.

David Rollinson: More importantly, I would say we believe we still have the ability to drive some increases in average sale price because we've been lifting the level of quality of our assortment and our merchandise. So when you see the price, I would think both in terms of some of it's taking prices and some of it's a change in mix of the price level of the merchandise we're bringing in. I would also point out that we've had a headwind as electronics prices have gone down. Electronics tends to be a higher priced item, and so while it tends to be lower margin, it tends to be higher priced and drives up average sale prices.

Price because we've been lifting the level of quality of our assortment and our merchandise. So when you see the price I would think both in terms of some of its taking price and some of it is a change in mix of the.

The pricing level of the.

The.

Merchandise, we're bringing in I would also point out that.

We've had a headwind as electronics has gone down electronics tends to be a higher priced item and so while it tends to be lower margin it tends to be higher price and drive up average sell prices, though is that.

David Rawlinson: Electronics tends to be a higher-priced item. So while it tends to be lower margin, it tends to be higher price and drive up average sale prices. As that's become a lower percentage of our mix, that's been a bit of a headwind, and we've been overcoming that headwind in terms of average sale price. If you saw some innovation in electronics and that coming back, I think that would be an even further tailwind to the amount of average sale price increase we're able to see in 2024. All of that said, as we go into 2024, we'd like to be a little bit less reliant on price and have a good balance between unit volume and price as we try to continue driving revenue stability and start moving towards trying to drive revenue growth.

David Rollinson: So as that's become a lower percentage of our mix, that's been a bit of a headwind, and we've been overcoming that headwind in terms of average sale price. So if you saw some innovation in electronics and that coming back, I think that would be an even further tailwind to the amount of average sale price increase we're able to see in 2024. All of that said, as we go into 2024, we'd like to be a little bit less reliant on price and have a good balance between unit volume and price as we try to continue driving revenue stability and start moving towards trying to lower revenue. Okay, my apologies if I missed this, um, just on Project Athens, when we look at that 300 to 600 opportunity there, you know, how much of that flowed Uh, it's a good question.

Become a lower percentage of our mix that's been a bit of a headwind and we've been overcoming that headwind in terms of average sell price. So if you saw some innovation in electronics and that coming back I think that would be an even further tailwind to the amount of <unk>.

Average sell price increase we're able to see in 2024.

All of that said as we go into 2024, we'd like to be a little bit less reliant on price and have.

Good balance between unit volume and price as we try to start continue driving revenue.

Stability and start moving towards trying to drive revenue growth.

Karru Martinson: Okay. My apologies if I missed this. Just on Project Athens, when we look at that 300 to 600, it would be an opportunity there. How much of that flowed through 2023, and how much should we think about the opportunity for 2024?

Okay, and my apologies if I missed this.

On project <unk>, when we look at that 300 to 600 OIBDA.

Opportunity there how much of that flowed through 'twenty, three and how much should we think about the opportunity for 2024.

Okay.

David Rawlinson: It's a good question. So I think a fair amount of it flowed through '23. You saw it really starting to come through in the back half of '23, of course. We see continued opportunities both because of the run rate increases from 2023 and because we're implementing new aspects of Project Athens that'll be coming online as we're going through 2024. So we continue to see ability and a runway towards OIBDA growth and OIBDA margin expansion on the total business.

It's a good question, so I think a fair amount of it flowed through.

David Rollinson: So I think a fair amount of it flowed through through twenty three. You saw it really starting to come through in the back half of twenty three. Of course, we see continued opportunities, both because of the run rate increases from twenty, twenty-three and because we're implementing new aspects of projects that'll be coming online as we're going through twenty, twenty-four. So, we continue to see ability and a runway toward growth and margin expansion on the total. Okay, and then just lastly, I noticed there seemed like a shift in the return policy, no longer printing return labels. What's the opportunity there for reducing those return costs? And our supply chain team has, you know, a number of continuous improvement initiatives, some of these associated with Project Athens to drive efficiency throughout.

23, you saw it really starting to come through.

The back half of 'twenty three of course, we see continued opportunities both because of the run rate increases for 2023.

And because.

We're implementing new aspects of project assets that'll be coming online as we're going through 2020.

For so we continue to see.

Mobility and a runway towards OIBDA growth in OIBDA margin expansion on the total business.

Karru Martinson: Okay. And then, just lastly, I've noticed there seemed like a shift in the return policy, no longer printing return labels. Kind of, what's the opportunity there of reducing those return costs for you?

Okay, and then just lastly.

I noticed there was it seemed like a shift in the return policy no longer printing return labels kind of what's the opportunity there.

Reducing those return cost for you.

And in our supply chain team is.

David Rawlinson: Our supply chain team has a number of continuous improvement initiatives, some of these associated with Project Athens, to drive efficiency throughout. That was one of several in terms of kind of materiality that's not going to hit your radar. Obviously, we're going to do 100 of these things that are going to move the needle for us in terms of improving Pack Factor and getting more efficiency in each of our distribution centers. So I think it's just one of several you're going to see. But.

Bill Wafford: Our supply chain team has a number of continuous improvement initiatives, some of these associated with Project Athens, to drive efficiency throughout. That was one of several in terms of kind of materiality that's not going to hit your radar. Obviously, we're going to do 100 of these things that are going to move the needle for us in terms of improving Pack Factor and getting more efficiency in each of our distribution centers. So I think it's just one of several you're going to see. But.

A number of continuous improvement initiatives some of these associated with project <unk>.

To drive efficiency throughout that was one of several.

Bill Wofford: That was one, you know, of several in terms of the kind of materiality that's not, you know, it's not going to hit your radar. Obviously, every, you know, we're going to do a hundred of these things that are going to move the needle for us in terms of improving pack factor and getting more efficiency, you know, in each of our distribution centers. But I think it's just one of several things you're going to see.

In terms of kind of materiality, that's not it's not going to hit your radar obviously every.

100, <unk> things that are going to move the needle for us.

In terms of improving pack factor and getting more efficiency.

Each of our distribution centers.

One of them one of several youre going to see.

David Rollinson: One thing I would say is that it is less of a cost issue, but we have negotiated with our vendors on the parcel and freight side to increase the opportunities and the ways that our customers can return items. We think it is an improvement in the customer experience. Customer returns actually end up being very highly correlated with customer satisfaction over time. We have worked pretty hard not just to get more efficient in the things we are doing in terms of returns but also to make it easier for customers who have returns. We have a good returns program, and we feel good about the progress we are making both in terms of efficiency and in terms of customer satisfaction.

Karru Martinson: One thing I would say is it's less of a cost issue, but we have negotiated with our vendors on the parcel and break side to increase the opportunities and the ways that our customers can return items. We think it's an improvement in the customer experience. Customer returns actually end up being very highly correlated with customer satisfaction over time. And so we've worked pretty hard not just to get more efficient in the things we're doing in terms of returns, but also to make it easier for customers who have returns. And so we have a good returns program, and we feel good about the progress we're making both in terms of efficiency and in terms of customer satisfaction. Thank you very much, guys. Appreciate it.

David Rawlinson: One thing I would say is it's less of a cost issue, but we have negotiated with our vendors on the parcel and break side to increase the opportunities and the ways that our customers can return items. We think it's an improvement in the customer experience. Customer returns actually end up being very highly correlated with customer satisfaction over time. And so we've worked pretty hard not just to get more efficient in the things we're doing in terms of returns, but also to make it easier for customers who have returns. And so we have a good returns program, and we feel good about the progress we're making both in terms of efficiency and in terms of customer satisfaction.

But one thing I would say.

Less of a cost issue, but.

We have negotiated with our vendors on the parcel at bright side to increase the opportunities in the ways that our customers can return items.

We think it's a improvement agenda customer experience customer returns actually ended up being very highly correlated with customer satisfaction overtime and so we've worked pretty hard not just.

Get more efficient and the things we're doing in terms of returns, but also to make it easier for customers who.

Returns and so we built we have a good returns program and we feel good about the progress we're making both in terms of efficiency and in terms of customer satisfaction.

Bill Wofford: Thank you very much, guys. I appreciate it. Thank you. And thank you to our listening audience. With that, I think we're done, Operator. We look forward to speaking to all of you next quarter, if not sooner.

Karru Martinson: Thank you very much, guys. Appreciate it.

Thank you very much guys I appreciate it.

David Rawlinson: Thank you.

Thank you.

Bill Wafford: And thank you to our listening audience. With that, I think we're done, operator. We look forward to speaking to all of you next quarter, if not sooner. Thank you.

Shane Kleinstein: And thank you to our listening audience. With that, I think we're done, operator. We look forward to speaking to all of you next quarter, if not sooner. Thank you.

And thank you to our listening audience with that I think we're done operator, we look forward to speaking to all of you next quarter if not sooner.

Operator: Thank you. Thank you. Thank you. The conference of Curate Retail has now concluded. Thank you for your participation. You may now disconnect your lines.

Thank you.

David Rawlinson: Thank you.

Thanks, Thank you.

Operator: Thank you. The conference of Qurate Retail has now concluded. Thank you for your participation. You may now disconnect your line.

The contents of Q&A retail has now concluded.

Thank you for your participation you may now disconnect your lines.

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Yes.

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Yes.

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Okay.

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