Bed Bath & Beyond Inc. (NASDAQ:BBBY) Q2 2019 Earnings Conference Call - Final Transcript

Oct 02, 2019 • 05:00 pm ET

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Bed Bath & Beyond Inc. (NASDAQ:BBBY) Q2 2019 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you. We'll now begin the question-and-answer session. [Operator Instructions] And our first question comes from Seth Basham from Wedbush. Your line is open.

Analyst
Seth Basham

Thanks a lot, and good afternoon. My question is around the outlook for holidays. You guys are shipping a bunch of marketing dollars and promotional dollars, the holiday period. Can you first quantify how much you're shipping and how much you're adding? And secondly, what kind of improvement you expect in those sales as well as margins over this period?

Executive
Robyn D'Elia

Sure. Thanks, Seth. So as you -- as you've mentioned, we are shifting dollars into the back half for promotional and marketing support. Those dollars are being generated from ongoing transformation initiatives as well as the benefits that Mary mentioned in our cost structure savings initiatives, and those dollars that we're planning to invest will be spent on promotional events during Thanksgiving week through Cyber Monday, as well as driving enrollment in Beyond Plus and investing in new communication channels such as digital video and radio. In terms of quantifying it, we've built it all into the model and those -- the reinvestment of those dollars is allowing us to maintain our top line at around $11.4 billion as well as maintain our bottom line within the previously guided range.

Analyst
Seth Basham

That's helpful. And then I have a follow-up as relates to your inventory. You guys are quickly reducing inventory to get to your goal of $1 billion reduction at retail. Should we expect any more markdowns or such a write-downs to reach that goal over the next 18 months?

Executive
Mary Winston

This is Mary. No, I think we believe that where we are with the write-down we're taking this quarter covers the full $1 billion of inventory. So now our work will just be to accelerate the process of actually getting it out of our stores.

Operator
Operator

And our next question comes from Brad Thomas from KeyBanc Capital Markets.

Analyst
Brad Thomas

Yes, hi, good afternoon. Thanks for taking my question. First, I wanted to ask about some of the strategic review as you analyze some of the different business units and some of the assets that you may be able to sell like some of the real estate. I guess, is there any ability to quantify for us the kinds of bids or interest level that may be out there and any more ability to talk about timing with which you might be able to address some of this?

Executive
Mary Winston

Hi, this is Mary. Thanks for the question, Brad. I would say, at this point, no, we're not in a position to put specific numbers to the businesses and all that. I will say, we are very actively engaged in the process, so, and we've had a number of inbound interests on some of our portfolio companies. And so we're taking a look at those. We're evaluating that. We're going through the normal process that you would go through to do that. And so when we have something to report that actually turns