Blue Apron (NYSE:APRN) reports its third-quarter earnings results before the market opens on Wednesday, Nov. 14. Analysts expect the company to lose $0.22 per share on revenue of $157.15 million. The latter number represents a 25% decrease in sales from a year ago, as the company continues to struggle to find new customers amid increasing competition. The earnings-per-share number indicates a vast improvement from last year, cutting Blue Apron's loss per share in half as it trims operational expenses.

But investors should look beyond the top- and bottom-line numbers when Blue Apron reports earnings. Management's commentary during the earnings call ought to provide greater insight into the health of the company going forward. Here are three things to watch when Blue Apron reports its third-quarter earnings results.

A box of ingredients from Blue Apron.

Image source: Blue Apron.

Marketing efficiency

Blue Apron has been struggling to attract new customers at a rate that offsets the rate at which its current customers cancel their subscriptions. It saw positive net customer additions in the first quarter as it started to ramp up its marketing spend again, but it couldn't keep the pace through the second quarter. Active customers fell to 717,000 at the end of the second quarter, below where it started the year.

At a recent investors conference, CFO Tim Bensley said the company is looking to be more efficient with its marketing dollars going forward:

I think we've started to do a pretty good job with matching that data up and saying, "Okay, here is the profile of a good customer. Here is the channel that they're most likely to be found in. Here's where we're going to go spend some money."

Investors will want to see net customer additions. Short of that, a smaller decline than what Blue Apron saw in the second quarter (69,000) would be a good sign, as long as it comes with moderate marketing expenses. Marketing expenses declined year over year in each of the first two quarters. Blue Apron started pulling back on marketing expenses in the second half of last year, so investors should expect less of a decline in marketing spend, if not an increase.

Progress with on-demand ordering

Blue Apron has been working to roll out an on-demand product for a couple quarters now. Management believes offering an on-demand option will enable it to reduce subscriber churn and improve its customer lifetime value.

The company found one of the top reasons subscribers cancel their subscriptions is that they're simply uncomfortable with having to manage a subscription in the first place. Offering those customers an on-demand option could enable Blue Apron to focus more on customers who want weekly deliveries than those who just want a few convenient meals every so often.

Blue Apron's on-demand efforts started with Costco, which stocks Blue Apron meal kits in select stores. Last quarter it expanded to partnerships with Grubhub and Walmart's Jet.com. The recent partnerships are restricted to the New York City area.

Investors should look for management to provide an update on the progress of those partnerships, potential expansion, and how consumer demand compares to their expectations.

What management expects in the fourth quarter

At the beginning of the year, CEO Brad Dickerson claimed he thinks Blue Apron could reach break-even on an adjusted EBITDA basis as soon as the fourth quarter. He reiterated that company goal in the second-quarter earnings call.

Blue Apron has lost over $17 million in each of the first two quarters on an adjusted EBITDA basis. That's a huge improvement from the previous year, but only a modest improvement compared to the fourth quarter last year after Blue Apron fully pulled back on marketing and had resolved its order-fulfillment issues.

Investors should see if Dickerson reiterates that goal, and if the results of the third quarter show an indication of progressing toward it. Further improvement in EBITDA is a sign that the company's focus on attracting more valuable customers and using marketing dollars more efficiently is starting to pay off as the company refocuses from growth at all costs to trying to show it's capable of producing a profit for investors.

Adam Levy has no position in any of the stocks mentioned. The Motley Fool recommends Costco Wholesale. The Motley Fool has a disclosure policy.