Earnings

Neighborhood Intelligence’s Third-Quarter Revenue Rises 98% on Acquisitions

The Tip Desk · November 5, 2026 · 3 min read

Third-quarter revenue reached $509 million as core e-commerce rose about 9% and Overstock.com sales increased 75%.

Neighborhood Intelligence, Inc. (NXH), formerly Bed Bath & Beyond, reported third-quarter 2026 net revenue of $509 million, up 98% from a year earlier, as the company folded in Kirkland’s, Kirkland’s Home and The Container Store.

Of the year-over-year increase, $229 million was attributable to those acquired businesses, which closed during the quarter. The remaining $23 million came from the core online e-commerce business and an improved assortment. Core e-commerce revenue increased approximately 9%, led by 75% year-over-year growth at Overstock.com.

Gross profit was $173 million, or about 34% of net revenue. The quarter included a planned $14 million purchase-price accounting benefit tied to inventory conditions identified before the acquisitions closed. The company said that benefit was substantially offset by its planned elimination of dated, obsolete and underperforming inventory. Management said it sees a path to a 37% gross margin through improved sourcing, assortment, inventory discipline and higher-margin home services.

Active customers rose to 9.0 million, up 117% from a year earlier, and orders delivered increased to 4.0 million, up 217%. Orders per active customer rose to 2.0 from 1.3. Executive Chairman and Chief Executive Officer Marcus A. Lemonis said the legacy e-commerce business had reached sustained revenue growth and adjusted EBITDA neutrality, and that the company’s focus is now on the assembled enterprise.

Sales and marketing expense was $54 million, or 10.7% of net revenue, an improvement of 330 basis points year over year. Technology and general and administrative expense was $165 million, compared with $33 million in the prior-year period, primarily due to acquired entities and professional fees related to the acquisitions.

Net loss was $26 million, or $0.28 a share, compared with a net loss of $5 million, or $0.07 a share, a year earlier. The current period included approximately $20 million of special items, primarily acquisition-related costs, restructuring costs and non-cash store-closure impairments. Adjusted EBITDA was ($26) million, compared with ($5) million.

Year to date, the company said it has eliminated more than $50 million in annualized SG&A costs and merger synergies. It has identified more than $40 million in additional annualized operational and merger savings through supply-chain consolidation, elimination of organizational redundancies and optimization of the store fleet. The company expects the full benefits of integration and merger synergies to develop over approximately six to nine months.

Inclusive of all closed transactions, retail store-fleet rationalization and modest organic growth, Neighborhood Intelligence currently expects consolidated revenue of $2.0 billion to $2.1 billion in 2027, with gross margins ranging from 33% to 34%. Management believes that if it achieves mid-single-digit organic revenue growth, improved operating efficiencies and expansion of higher-margin home services, the company should be positioned to achieve an enterprise-wide positive cash-flow inflection by the second half of 2027.

The 2027 baseline assumes continued weakness in housing starts and existing-home sales. Management believes approximately 5% annual organic revenue growth is achievable from that 2027 base over the following three to four years without a housing recovery, and that it can generate about $30 million in incremental operating contribution for every additional $100 million of organic revenue. Lemonis said the company is moving quickly to prepare for a more robust return to normalized housing activity and that even a modest improvement could create meaningful upside.

Cash, cash equivalents and restricted cash was $127 million at September 30, 2026. The company also cited $228 million in inventory and real estate owned free of $26 million of borrowings, with equity in inventory of $110 million net of $118 million of ABL borrowings.

In October, Neighborhood Intelligence and Fathom Holdings mutually terminated a previously announced merger. The company said it would retain ownership of its blockchain assets, including tZERO, while the two firms explore collaboration such as data sharing.