Charles & Colvard, Ltd. (NASDAQ:CTHR) Q4 2023 Earnings Call Transcript

Look to us to stabilize our current state, amplify our brand, diversify revenue streams and strategically adapt our technology. Now I’d like to highlight our upcoming strategic initiatives. For fiscal 2024, the company’s core focus will be to continue to enhance its global brand awareness campaigns, diversify its product categories and innovate its technology to stay ahead of the competition to deliver additional products and services, unlocking new revenue streams. More specifically, as it relates to global brand awareness, we plan to continue strengthening the fine jewelry brand we have been building for nearly three decades. As the consumer landscape continues to shift and factors beyond price, craftsmanship and origin are driving decisions to purchase brand equity is more important than ever.

We believe we will continue to invest in paid media campaigns targeting the trade and consumers as we reinforce our Made, not Mined providence. We will also remain steadfast in our quest for sustained top line organic growth as our brand messaging resonates with new audiences. To diversify our product categories, we will continue to evaluate opportunities for growth with synergistic brands, products and verticals beyond our current offerings. Emerging consumer trends and data will inform new product lines, collections, partnerships with designers and influencers. We will explore strategic allowances to fuel growth and deliver incremental long-term shareholder value, while prioritizing our sustainable practices and our core values. Lastly, evolving technology continues to shape how consumers discover research and ultimately purchase.

We will continue to invest strategically in technology to service customers in existing and new outlets. We believe that our investment in innovative technology and predictive analytics will further maximize our ability to be agile and efficient in our business. We will enhance our consumer experience to immersive virtual selling and fully customizable products driven by actionable data. Additionally, we’ll continue to capitalize on our leading-edge streaming broadcast technology to digitally attract new audiences, each with unique characteristics while broadening our footprint and ability to drive organic growth. Fundamentally, our goal is to find ways to reach consumers more efficiently and cost effectively while strengthening our moat and overall position in the market.

Expanding our business to directly interface with the consumer, while controlling the customer experience is critical. As highlighted by the challenges in our wholesale channels, a quick look at the numbers shows that our traditional segment which is comprised primarily of wholesale loose gemstones was down 61% during the fourth quarter. This shrinking segment is in part by design and a primary reason we will continue to seek and open new channels that enable us to interact directly with the customer at all points along their buying journey. To achieve this, we are building an environment to meet today’s consumers with shoppable, interactive live streaming on connected TV, linear broadcasting, satellite and social media platforms. Taking a step back for those not familiar with it, we believe this is a growth opportunity for the company.

This technology is being embraced by industry leaders such as Roku and Shopify’s recent announcement of a strategic partnership. Amazon’s announcement of Amazon Live and Pinterest’s announcement of Pin TV. Fueling these trends is the increased usage of smart TVs, along with the new payment alternatives, which makes shopping via TV easier and more streamlined. The global TV shopping market size is vast and expected to grow by 6% annually to $440 billion by 2030. In addition, among the several product categories within the TV shopping market, jewelry is expected to dominate this space and be the largest offering within this selling vertical by 2028. We’re excited to introduce this beta phase of our interactive shopping initiative by going live on select cable and satellite TV providers broadcasting, our Made shopping content, highlighting our Made, not Mined, Forever One Moissanite and Caydia lab-grown diamonds to over 20 million households weekly and streaming via YouTube, Facebook, LinkedIn to potentially millions of households.