What happened

Blue Apron Holdings, Inc. (NYSE:APRN), a food delivery subscription service company that recently went public on the New York Stock Exchange, is having another rough day as shares plunged 15% as of 11:30 a.m. EDT following a wider-than-expected second-quarter loss.

So what

Blue Apron's second quarter seemed to be a case of "good but not good enough." The company's net revenue jumped 18% compared to the prior year, to $238.1 million during the second quarter, which was higher than analysts' estimates calling for $235.8 million. Wall Street's issue with the results seemed to be on the bottom line, where Blue Apron reported a net loss of $31.6 million, or $0.47 per share -- a reversal from the prior year's $5.5 million net income. Furthermore, that loss per share was more than analyst estimates for a more modest $0.27 per share. 

Fresh fish and food laid out on a wooden cutting board

Image source: Getty Images.

Despite the large bottom-line miss, CEO Matt Salzberg put a positive spin on the young company's business. "In the second quarter, we saw an 18 percent year-over-year increase in net revenue, and a $20.6 million improvement in our net loss between the first and second quarters. We recently strengthened our balance sheet as a result of our initial public offering, convertible note issuance and the expansion of our revolving credit facility," said Salzberg in a press release. "We are beginning a new chapter as a public company, and remain focused on our long-term strategy to build an iconic consumer brand, develop a more diverse product portfolio, and further build out an end-to-end supply chain platform."

Now what

The truth is, investors want one thing from recent IPOs and that's growth, pure and simple. Unfortunately, one of the biggest downsides to Blue Apron's second quarter, in addition to its big bottom-line loss, was that its number of customers fell 9% during the second quarter, compared sequentially to the first quarter of 2017. Management noted the $26.1 million reduction in marketing was to blame for the drop, but that did little to ease investors' concerns that growth may be more difficult and more costly than anticipated -- bad news for such a young company in a competitive industry. Further adding insult to injury was management noting that the company's delayed Linden, New Jersey, facility would negatively impact earnings during the second half of the year. 

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