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• Total Revenue: $1.8 billion, down 11% year-over-year.

• GAAP Operating Income: $102 million, compared to $108 million in the prior year.

• Adjusted Operating Income: $41 million, down from $112 million last year.

• Adjusted EBITDA: $62 million, compared to $138 million in the previous year.

• Adjusted Net Income: $24 million or $0.71 per diluted share, down from $85 million or $2.17 per diluted share last year.

• Operating Cash Flow: $81 million, down from $120 million in the same period last year.

• Capital Expenditures: $22 million, up from $20 million in the prior year.

• Adjusted Free Cash Flow: $68 million, compared to $102 million last year.

• ODP Business Solutions Revenue: $916 million, down 8% year-over-year.

• Office Depot Revenue: $861 million, a 15% decline year-over-year.

• Veyer Third-Party Revenue: Over $14 million, approximately a 30% increase year-over-year.

• Total Liquidity: $728 million, including $192 million in cash and cash equivalents.

• Total Debt: $246 million.

• Share Repurchases: Over $100 million in the third quarter, $295 million year-to-date.

• 2024 Revenue Guidance: Approximately $7 billion.

• 2024 Adjusted EBITDA Guidance: $260 million to $300 million.

• 2024 Adjusted Operating Income Guidance: $160 million to $200 million.

• 2024 Adjusted EPS Guidance: $3.10 to $3.80 per share.

• Warning! GuruFocus has detected 8 Warning Signs with SRRTF.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• The ODP Corp (NASDAQ:ODP) is making significant progress on its strategic B2B pivot, securing key B2B contracts and expanding into high-value industry sectors.

• The company announced a major new B2B contract worth up to $1.5 billion over a 10-year period, marking one of the largest in its history.

• Veyer, ODP's supply chain business, continues to attract new third-party customers, with external revenue up about 30% over last year.

• ODP is actively pursuing growth opportunities in adjacent industry segments, such as the hospitality industry, which aligns well with its core competencies.

• The company maintains a strong balance sheet with total liquidity of $728 million, providing a solid foundation for future investments and growth initiatives.

Negative Points

• The ODP Corp (NASDAQ:ODP) reported third-quarter results below expectations, primarily due to challenges in its retail division and weak macroeconomic conditions.

• Revenue for the third quarter was down about 11% compared to last year, driven by lower sales in Office Depot and ODP Business Solutions.

• The company faced significant disruptions from major hurricanes, impacting customer activity and operations in its largest service areas.

• ODP's adjusted operating income and EBITDA were significantly lower compared to the prior year, reflecting the impact of lower sales and competitive pressures.

• The company has decided to modify its operational guidance for 2024, lowering its adjusted EBITDA and operating income outlook due to ongoing challenges and investment demands.