Is Overstock's Blockchain Gamble Paying Dividends?

Online retailer Overstock.com aims to recover from substantial losses in 2018 with a return to profitability this year. The company has been heavily investing in blockchain technology and recently launched a security token trading platform through its subsidiary, tZERO. Despite these initiatives, Overstock's retail arm faced losses last year, prompting a shift back to a profitability-focused strategy.

Is Overstock's Gamble on Blockchain Paying Off?

Online retailer Overstock.com is aiming to turn things around after suffering hefty losses in 2018. The company, an early adopter of Bitcoin, has been pouring resources into blockchain technology.

CEO Byrne: Blockchain Projects "Cutting Edge"

In the company's Q4 earnings report, CEO and Founder Patrick Byrne touted Overstock's blockchain initiatives as "some of the most significant and cutting edge in the world." He emphasized the launch of tZERO's security token trading platform.

Retail Losses "Nauseating"

Byrne acknowledged that Overstock's retail arm lost money last year, blaming an unsuccessful attempt to replicate the high-growth, money-losing model of other e-commerce businesses. However, he vowed a return to profitability in 2019, with a positive operating cash flow exceeding $10 million.

Q4 Earnings: Revenue Down, Losses Narrow

Overstock reported Q4 revenue of $452.5 million, a slight decline from $456.3 million in the previous year. The company's losses narrowed to $42.3 million, compared to $95.7 million in Q4 2017.

Analysts' Views

Analysts are cautiously optimistic about Overstock's prospects. They note the potential of blockchain technology but caution that it's still an emerging field. They also express concern about the company's ability to generate sustained profits from its retail operations.

Overstock's Future: Riding the Blockchain Wave?

Overstock's pivot towards blockchain represents a significant gamble. The company's success will hinge on the adoption and commercialization of blockchain-based products. If Overstock can ride the blockchain wave, it could emerge as a leader in this rapidly evolving industry.

Conclusion

Overstock's reversal of strategy in the face of "nauseating" losses is a testament to the company's willingness to embrace new technologies. While the blockchain gamble is fraught with uncertainty, it also holds the potential for substantial rewards. Investors will be watching closely to see if Overstock's bet on blockchain pays off.