What happened

Shares of online closeout retailer and blockchain technology developer Overstock.com (BYON 3.71%) soared on Thursday, following a better-than-expected first-quarter earnings report. The stock jumped as much as 18.6% shortly after the opening bell, settling down to a milder 11% gain by noon ET.

So what

Overstock exceeded Wall Street's revenue and earnings estimates, but those expectations were set quite low. Your average analyst was looking for a net loss of $0.15 per share, down from a net profit of $0.21 in the year-ago period. Top-line sales were expected to land near $358 million -- 33% below the $536 million Overstock reported in the first quarter of 2022.

So when the bottom line swung to an adjusted loss of $0.10 per share and revenue swooned 29% lower to $381 million, golf claps ensued. This performance was impressive in light of the rock-bottom expectations, but Overstock's business is clearly struggling right now.

Now what

The struggle is real. Even after today's sharp price spike, shares are trading less than 20% above its recently-set multiyear lows. The company's online retail sales doubled in the earliest days of the coronavirus crisis, but have been sliding lower ever since -- and the wilting revenue trend is a solid indicator of what Overstock's share price will do next.

This chart doesn't include today's hot-off-the-presses results, but you get my drift:

OSTK Chart

OSTK data by YCharts.

There are some serious silver linings to Overstock's cloudy skies. For example, the number of active retail customers is down but the average order value is holding steady. Management wants to see more orders placed through its mobile apps, and that metric rose from 50% of total gross merchandise a year ago to 51% in the most recent quarter. Baby steps, sure, but this company needs to celebrate those small victories.

That being said, I don't think this report changed the game for Overstock's investors. I don't put much stock in Overstock these days, and will gladly watch its turnaround effort from the sidelines.