The Redbubble Ltd (ASX: RBL) share price fell 6.3% to 89 cents today after the online marketplace for fashion fans and artists confirmed it is expecting to post an operating loss of $5.2 million for the year ending June 30, 2017.
The company expects to deliver total revenues of $141 million for the full year which would represent an uplift of 30.1% over the prior year on a constant currency basis. Cash operating expenses were up 18% on a constant currency basis to $43.1 million,
The company also warned that gross transaction value (GTV) growth for the quarter ending June 30 2017 "was slower than in previous quarters" in part due to increasing competition in its core U.S. market. However, GTV was still up 19.6% for the quarter, with its European language websites boasting especially strong growth.
Redbubble flagged that challenges include competition and the shift to mobile which will require further investment in technology, "new products, features and services for customers and artists". Investors then may have been disappointed by the failure to give guidance for the company to move into operating profitability over FY 2018.
The company maintains a strong balance sheet with no debt and $27.9 million cash in hand on its balance sheet. Based on its current share price, Redbubble is valued at around $200 million.
