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1. Company Snapshot

1.a. Company Description

Grove Collaborative Holdings, Inc.operates as a plastic neutral consumer products retailer in the United States.It provides household cleaning, personal care, laundry, clean beauty, baby, and pet care products for households.


The company is based in San Francisco, California.

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1.b. Last Insights on GROV

Grove Collaborative Holdings, Inc.'s recent positive drivers include the strategic acquisition of Grab Green's assets, expanding its eco-friendly product offerings. The company has also launched a new blog, "Home Planet", providing customers with trusted information on environmental and human health, potentially driving engagement and loyalty. Additionally, the Spring Limited Edition Collection launch in partnership with The 5 Gyres Institute may boost sales and brand awareness. Upcoming Q4 and full-year 2024 financial results on March 11, 2025, may provide further insight into the company's growth momentum.

1.c. Company Highlights

2. Grove Collaborative Holdings' Q3 2025 Earnings: A Challenging Quarter Amidst Transformation

Grove Collaborative Holdings reported revenue of $43.7 million for Q3 2025, representing a decline of 0.7% sequentially and 9.4% year-over-year. The company's gross margin improved to 53.3%, up 30 basis points compared to the same quarter last year. The EPS loss was $0.08, beating estimates of a loss of $0.09. The revenue decline was largely attributed to reduced advertising investment and friction from the eCommerce platform migration.

Publication Date: Nov -20

📋 Highlights
  • Revenue Decline: Q3 revenue fell to $43.7M (-0.7% sequentially, -9.4% YoY), driven by reduced advertising and platform migration friction.
  • Gross Margin Improvement: Margins rose to 53.3% (+30 bps YoY), signaling operational efficiency gains despite revenue challenges.
  • EBITDA Guidance: Maintained adjusted EBITDA in negative low single-digit millions to breakeven, with Q4 expected to turn positive due to SG&A cuts.
  • Platform Migration Challenges: Mobile app, subscription, and payment issues impacted customer experience, but fixes are prioritized to boost retention and LTV.
  • Strategic M&A Focus: Exploring acquisitions in wellness, supplements, and beauty to accelerate scale, with cash reserves or potential fundraising as funding sources.

Operational Challenges and Transformation Efforts

The migration of Grove's eCommerce platform has been marked by customer experience challenges, including issues with the mobile app experience, subscriptions, and payments. The company is executing with urgency to fix these issues, with a near-term focus on improving the mobile app and subscription experience. According to Jeff Yurcisin, CEO, "We're close to resolving the issues and expect to see paybacks accelerate once the core experience meets expectations."

Financial Guidance and Priorities

Grove is maintaining its adjusted EBITDA guidance of negative low single-digit millions to breakeven. However, it expects fourth-quarter adjusted EBITDA to be positive, benefiting from the pullback in advertising spend and structural SG&A reductions. The company is prioritizing cash flow and profitability over short-term revenue growth to maintain balance sheet stability through the transition.

Valuation and Growth Prospects

The current P/S Ratio of 0.31 suggests that investors have low expectations for the company's revenue growth. Analysts estimate revenue growth of 3.6% for next year. With an EV/EBITDA ratio of -4.44, the market is pricing in significant improvement in EBITDA. Grove's focus on long-term profitable growth, rather than just short-term revenue growth, may justify the current valuation.

Strategic Initiatives and M&A

Grove is evaluating potential acquisitions and divestitures to accelerate scale and revenue or strengthen its competitive position. The company is guided by principles of sustainable shareholder value creation, capital efficiency, and delivering a superior customer experience. With a strong brand in the wellness space, Grove is seeing interest from many companies and has a few significant launches planned in the next 100 days.

3. NewsRoom

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Critical Comparison: Unilever (NYSE:UL) versus Grove Collaborative (NYSE:GROV)

Nov -19

Source: defenseworld.net

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Grove Collaborative Holdings, Inc. (GROV) Q3 2025 Earnings Call Transcript

Nov -14

Source: seekingalpha.com

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Grove Announces Third Quarter 2025 Financial Results

Nov -13

Source: businesswire.com

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Grove to Report Third Quarter 2025 Financial Results on November 13, 2025

Oct -30

Source: businesswire.com

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Grove Launches New Open-Source Approach to Sustainable AI Measurement

Sep -22

Source: businesswire.com

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Grove Collaborative Taps Novi to Power Verified Product Claims Across Its Full Marketplace

Aug -11

Source: prnewswire.com

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Grove Collaborative Holdings, Inc. (GROV) Q2 2025 Earnings Call Transcript

Aug -09

Source: seekingalpha.com

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Grove to Present at Upcoming Investor & Micro Cap Conferences

Jul -31

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.78%)

6. Segments

Third-party Products

Expected Growth: 5%

Grove Collaborative Holdings' third-party products segment growth is driven by increasing consumer demand for eco-friendly and sustainable products, strategic partnerships with popular brands, expansion into new product categories, and a strong e-commerce platform. Additionally, the company's focus on digital marketing and social media influencer partnerships contributes to its growth.

Grove Brands

Expected Growth: -2.0%

Grove Brands, a subsidiary of Grove Collaborative Holdings, Inc., faces a -2.0% growth rate due to declining demand for natural household products, increased competition from established brands, and high operational costs. Additionally, the company's reliance on a single product category and limited geographic presence hinder its ability to diversify and expand.

7. Detailed Products

Cleaning Products

Eco-friendly cleaning products for the home, including all-purpose cleaners, dish soaps, and laundry detergents.

Personal Care Products

Natural and sustainable personal care products, including soaps, lotions, and skincare items.

Paper Products

Sustainable paper products, including paper towels, toilet paper, and tissues.

Home and Kitchen Essentials

Eco-friendly home and kitchen essentials, including trash bags, cleaning tools, and kitchen utensils.

Wellness and Self-Care Products

Natural wellness and self-care products, including supplements, vitamins, and wellness tools.

8. Grove Collaborative Holdings, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Grove Collaborative Holdings, Inc. operates in the consumer goods industry, where substitutes are readily available. However, the company's focus on natural and sustainable products may reduce the threat of substitutes.

Bargaining Power Of Customers

Grove Collaborative Holdings, Inc. has a strong online presence, which reduces the bargaining power of customers. Additionally, the company's subscription-based model and loyalty program help to retain customers.

Bargaining Power Of Suppliers

Grove Collaborative Holdings, Inc. sources its products from a diverse range of suppliers, which reduces the bargaining power of individual suppliers. However, the company's focus on natural and sustainable products may limit its supplier options.

Threat Of New Entrants

The consumer goods industry is highly competitive, and new entrants can easily enter the market. Grove Collaborative Holdings, Inc. needs to continuously innovate and differentiate its products to maintain its market share.

Intensity Of Rivalry

The consumer goods industry is highly competitive, and Grove Collaborative Holdings, Inc. faces intense rivalry from established players and new entrants. The company needs to focus on differentiating its products and services to maintain its market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 80.57%
Debt Cost 8.41%
Equity Weight 19.43%
Equity Cost 8.41%
WACC 8.41%
Leverage 414.69%

11. Quality Control: Grove Collaborative Holdings, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.25$

Current Price

1.25$

Potential

-0.00%

Expected Cash-Flows