Qurate Retail, Inc.

ladies and gentlemen thank you for standing by welcome to the curate retail link 2021 q2 earnings call during the presentation all participants will be in a listen only mode afterwards we will conduct a question and answer session at that time if you have a question please press star 1 on your telephone as a reminder this conference is being recorded august 6. i would now like to turn the conference over to courtney chun chief portfolio officer please go ahead thank you

Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent forms 10-K and 10-Q filed by our company and QVC with the SEC. These forward-looking statements speak only as of the date of this call and Curate Retail expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein. to reflect any change and curate retail's expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based. On today's call, we will discuss certain non-GAAP financial measures, including adjusted OIVDA, adjusted OIVDA margin, free cash flow, and constant currency. Information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary note and schedules one through three, can be found in the earnings press release issued today on our earnings presentation. which are available on our website. Today, speaking on the earnings call, we have Curate Retail CEO, Mike George, Curate Retail Group CFO, Jeff Davis, Curate Retail Executive Chairman, Greg Maffei, and we'd like to welcome Curate Retail President and CEO-elect, David Rawlingson. Now, I'll hand the call over to Mike George.

Thank you, Courtney, and good morning, everyone. Thank you for joining us today and for your interest in Curate Retail. In the second quarter, we started the anniversary pandemic-related growth. Therefore, in our comments, we'll include select two-year performance metrics to provide important context for our results. We delivered year-over-year revenue and EBITDA growth on a constant currency basis, up 1% and 2% respectively, on top of last year's strong growth. Compared to 2019, revenue increased 11%, and Oybeta increased 12% in constant currency. The quarter played out largely as we expected. At QXH, we saw a continued rebound of our best customers with the return to growth of apparel and accessories. While new and reactivated customer account declined, it remained significantly elevated compared to 2019. Similarly, home declined given the steep comps in food, personal protection, and cleaning products from the initial stages of the pandemic, but is up high teens from 2019. QVC International maintains strong revenue in Orbita growth, sustaining the momentum from last year. Zulily revenue declined as we comped the steepest part of the pandemic curve, but we delivered healthy revenue in Orbita growth compared with 2019. And Cornerstone delivered outstanding performance with record Q2 revenue in Orbita at all of its businesses. While these results were largely expected, we did not anticipate the degree of product shortages we experienced or the level of inflationary pressures across the P&L, which other retailers are also facing. The fact that we delivered year-over-year growth and OIBEDA margin expansion, even with these challenges, is a testament to the strength of our business model. The strong second quarter results further confirm our belief though we are a much better business now than when we entered the pandemic, with an expanded and loyal customer base, strength across multiple product categories, and more extensive distribution and reach of our digital and video content. We're well positioned for growth, poised to take advantage of the long-term trends toward online shopping, video streaming, social media, and all things for the home. Before I discuss each of our businesses, I am delighted to welcome David Rawlinson as my successor. David joined us on August 1st as president and CEO-elect, and will assume the role of CEO on October 1st. David is the right leader to take this wonderful company forward and write our next chapter of growth. He brings an impressive track record of success, most recently with two-story brands, Nielsen and Grainger. He is a transformational leader with deep experience in global e-commerce and in digital and data-driven businesses. He's played a pivotal role in helping prominent companies like Grainger embrace new customer segments and emerging digital business models while protecting historic strengths. And he inherits an outstanding management team with deep retail, digital, and broadcast expertise And I can't wait to see what they'll accomplish together as they lead Curate in our next phase of digital growth and transformation.