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Microcap & Penny Stocks : Qurate Retail
QVCGA 11.65-0.7%9:30 AM EST
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To: Sean Collett who wrote (86)11/5/2025 8:57:07 AM
From: Sean Collett1 Recommendation

Recommended By
sixty2nds

   of 90
 
RE: Q3 Earnings Analysis

Listened to the earnings call this morning and thought I would add some notes based on what I heard. Once again no live call and thus no Q&A - as I wrote in the Q2 earnings this is usually a tell bankruptcy is on the table. Not in isolation of course but with everything else we have seen in the timeline. There were not even any presubmitted questions this time like there was with Q2.

This has chapter 11 written all over it.

Rawlinson comments:
  • Encouraged by results they're seeing in social growth....
  • Linear is putting pressure on revenue but confident on social growth
  • Completed IT outsourcing and 1K employee reduction programs
  • On track for plan that no country will makeup > 1/3 of sourced goods
  • Returning company to growth has been challenging
  • Social and streaming revenue growth is improving and is helping to offset linear revenue loss. Social/streaming is growing 30% YoY
  • Added 255K TikTok shop customers + 300K through linear digial channels. Repeat customers on TikTok shows promise
  • Existing customers declined 10%
  • David gave a spin on how if you include TikTok customers into the totals then they look better. Irrelevant in my view. This is marketing spin from him as CEO.
  • Experienced declines in all categories but the rate of decline slowed compared to Q2.
  • Will have a second TikTok super brand day. Gave a bunch of other marketing fluff comments on promotions they are doing.

Bill Wafford:
  • Management incentive plan is to reward leadership during difficult time and allow them to focus on WIN strategy. This is now an expense and will impact OIBDA.
  • FCF was negative due to TV distribution right increases, dividend payments to Japanese partner, and lower operating income.
  • Leverage ratio is 4.2x with covenant being at 4.5x
  • Continuing to review strategic financial alternatives but no updates yet.

Gerg Maffei:
  • Challenging quarter but making progress on WIN strategy.
  • Working on capital structure and balance sheet
  • Appreciate continued interest in QVC Group

Overall a vanilla call with no real meat. Rawlinson continues to spin every negative as a positive and I think many equity holders eat it up, but proof is in the results which continue to disappoint.

At this point I think QVC goes through holidays and then files in Q1 before the Q4 earnings. This will allow them to capture any cash flows from the holidays and not risk any business disruptions. Could be possible they file sooner give ($185M) of cash flow in 3 quarters this year, but I think if they have not filed already they truck it for a bit more until Jan-Feb.

Either way, this is not an LME case and they will likely be filing. Equity is a zero.

-Sean
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