- Enjoy Technology's interim chief financial officer, Cal Hoagland, resigned from the company effective June 1, according to a securities filing. The departure follows that of previous CFO Fareed Khan, who left in April.
- The company did not announce a new interim finance chief or transition plan. Enjoy has been wrestling with increasing cash burn, and its recent filings include "going concern" warnings that it might not survive without additional capital.
- Enjoy, whose CEO and co-founder is former J.C. Penney chief and Apple retail executive Ron Johnson, operates a "commerce-at-home" retail channel that aims to bring store experiences and expertise to homes.
Launched in 2015, Enjoy has built its business on trying to fill what it sees as a lack of service and personal touch in the e-commerce experience by bringing a mobile "store" to consumers' homes.
The company contracts with technology brands, including AT&T and Apple, and has ambitions to expand into other retail categories. It touts its technology and a retail sales team that it says "provide everything that is provided by a store in the comfort of a home including set-up, activation and demonstration of the products we deliver."
In a company video, Johnson points to Uber and Airbnb, which respectively turned consumers' cars into taxies and homes into hotels, as inspiration. "Maybe we can bring the entire retail store to the home," Johnson said in the video. "So we have invented the next disruption in commerce."
Enjoy became public in 2021 after combining with Marquee Raine Acquisition Corp., a special purpose acquisition company (or SPAC). Its financial problems have only worsened since.
Enjoy has roughly 650 mobile stores in North America that generate $355 in revenue a day per store. For the first quarter of this year, those stores racked up a $9 million loss, nearly triple the loss for that segment last year.
By the end of last year, Enjoy had an accumulated deficit of $642.5 million, with costs only expected to increase. In the first quarter, the company had cash outflows of $47.8 million and net losses of $55.2 million, with costs of revenue and other operating costs stacking up far beyond revenue levels.
Enjoy is currently reviewing its strategic initiatives, which could include a sale or other strategic transaction. To keep it afloat during the process, Johnson lent the company $10 million, a note that is due later this year, and it has also has received a $6.1 million prepayment by a business customer for "future services reasonably expected to be rendered," according to a March 31 filing.
If it can't secure additional liquidity sources, it may have to file for bankruptcy, the company said. The company also noted in the filing it won't have enough cash to finance operations for June without additional liquidity.
Analysts with Telsey Advisory Group led by Dana Telsey highlighted the lack of an announced CFO search in the announcement of Hoagland's departure. "This news, combined with no update on securing additional capital —does not bode well for the future," the analysts said in an emailed note.
The analysts also said that they are "increasingly concerned about Enjoy's ability to continue as a going concern, given significant business challenges — product availability and high operating costs — that are resulting in higher-than-anticipated operating losses and cash burn."
Correction: A previous version of this story incorrectly stated the amount Enjoy Technology's North American mobile stores generated.