Wayfair Announces First Quarter 2025 Results, Reports Further Share Capture with Robust Profitability

Q1 Net Revenue of $2.7 billion with 21.1 million Active Customers , /PRNewswire/ -- Wayfair Inc. ("Wayfair," "we," or "our") (NYSE: W), the destination for all things home, today reported financial results for its first quarter ended March 31, 2025. First Quarter 2025 Financial Highlights Total net revenue of $2.7 billion, increased $1 million, or was close to flat, year over year U.S. net revenue of $2.4 billion, increased $38 million, up 1.6% year over year International net revenue of $301 million, decreased $37 million, down 10.9% year over year. International Net Revenue Constant Currency Growth was (7.1)% Gross profit was $837 million, or 30.7% of total net revenue Net loss was $113 million and Non-GAAP Adjusted EBITDA was $106 million Diluted loss per share was $0.89 and Non-GAAP Adjusted Diluted Earnings Per Share was $0.10 Net cash used in operating activities was $96 million and Non-GAAP Free Cash Flow was ($139) million Cash, cash equivalents and short-term investments totaled $1.4 billion and total liquidity was $1.8 billion, including availability under our revolving credit facility "Despite persistent category volatility which marked a fourth consecutive year beginning with contraction, we were able to once again outperform our peers and take healthy market share while driving meaningful improvements in profitability. Year-over-year growth excluding the impact of Germany came in nicely positive - driven by the US business up 1.6% against a category that we estimate declined over the same time frame. Tariffs are clearly top of mind for everyone - while there's a lot of uncertainty in the broader economy, we have direct line of sight and strong conviction on what we need to do for both our customers and our suppliers," said Niraj Shah, CEO, co-founder and co-chairman, Wayfair. Shah continued, "As we look ahead, our strategy remains clear: continue gaining share through disciplined execution, deepen our partnerships with suppliers, and invest judiciously in high-ROI growth initiatives. We've deliberately built a platform that thrives in dynamic conditions: flexible, resilient, and efficient. With strong momentum, a healthy balance sheet, and a sharpened operating model, we're confident in our ability to navigate what's ahead and emerge even stronger." Other First Quarter Highlights Active customers totaled 21.1 million as of March 31, 2025, a decrease of 5.4% year over year LTM net revenue per active customer was $562 as of March 31, 2025, an increase of 4.7% year over year Orders per customer, measured as LTM orders divided by active customers, was 1.85 for the first quarter of 2025, compared to 1.84 for the first quarter of 2024 Orders delivered in the first quarter of 2025 were 9.1 million, a decrease of 5.2% year over year Repeat customers placed 80.5% of total orders delivered in both of the first quarters of 2025 and 2024 Repeat customers placed 7.3 million orders in the first quarter of 2025, a decrease of 5.2% year over year Average order value was $301 in the first quarter of 2025, compared to $285 in the first quarter of 2024 63.4% of total orders delivered were placed via a mobile device in the first quarter of 2025, compared to 63.1% in the first quarter of 2024 Key Financial Statement and Operating Metrics Three Months Ended March 31, 2025 2024 (in millions, except LTM net revenue per active customer, average order value and per share data) Key Financial Statement Metrics: Net revenue $ 2,730 $ 2,729 Gross profit $ 837 $ 819 Loss from operations $ (122) $ (235) Net loss $ (113) $ (248) Loss per share: Basic $ (0.89) $ (2.06) Diluted $ (0.89) $ (2.06) Net cash used in operating activities $ (96) $ (139) Key Operating Metrics: Active customers (1) 21 22 LTM net revenue per active customer (2) $ 562 $ 537 Orders delivered (3) 9 10 Average order value (4) $ 301 $ 285 Non-GAAP Financial Measures: Adjusted EBITDA $ 106 $ 75 Free Cash Flow $ (139) $ (193) Adjusted Diluted Earnings (Loss) per Share $ 0.10 $ (0.32) (1) The number of active customers represents the total number of individual customers who have purchased at least once directly from our sites during the preceding twelve-month period. The change in active customers in a reported period captures both the inflow of new customers as well as the outflow of existing customers who have not made a purchase in the last twelve months. We view the number of active customers as a key indicator of our growth. (2) LTM net revenue per active customer represents our total net revenue in the last twelve months divided by our total number of active customers for the same preceding twelve-month period. We view LTM net revenue per active customer as a key indicator of our customers' purchasing patterns, including their initial and repeat purchase behavior. (3) Orders delivered represent the total orders delivered in any period, inclusive of orders that may eventually be returned. As we ship a large volume of packages through multiple carriers, actual delivery dates may not always be available, and as such we estimate delivery dates based on historical data. We recognize net revenue when an order is delivered, and therefore orders delivered, together with average order value, is an indicator of the net revenue we expect to recognize in a given period. We view orders delivered as a key indicator of our growth. (4) We define average order value as total net revenue in a given period divided by the orders delivered in that period. We view average order value as a key indicator of the mix of products on our sites, the mix of offers and promotions and the purchasing behavior of our customers. Webcast and Conference Call Wayfair will host a conference call and webcast to discuss its first quarter 2025 financial results today at 8 a.m. (ET). Investors and participants should register for the call in advance by visiting https://registrations.events/direct/Q4I569320. After registering, instructions will be shared on how to join the call. The call will also be available via live webcast at https://events.q4inc.com/attendee/886978538. An archive of the webcast conference call will be available shortly after the call ends on Wayfair's Investor website at investor.wayfair.com. Important information may be disseminated initially or exclusively via the Investor website; investors should consult the site to access this information. About Wayfair Wayfair is the destination for all things home, and we make it easy to create a home that is just right for you. Whether you're looking for that perfect piece or redesigning your entire space, Wayfair offers quality finds for every style and budget, and a seamless experience from inspiration to installation. The Wayfair family of brands includes: Wayfair: Every style. Every home. AllModern: Modern made simple. Birch Lane: Classic style for joyful living. Joss & Main: The ultimate style edit for home. Perigold: The destination for luxury home. Wayfair Professional: A one-stop Pro shop. Wayfair generated $11.9 billion in net revenue for the twelve months ended March 31, 2025 and is headquartered in Boston, Massachusetts with global operations. Media Relations Contact:Tara Lambropoulos[email protected] Investor Relations Contact:Ryan Barney[email protected] Forward-Looking Statements This press release contains forward-looking statements within the meaning of federal and state securities laws. All statements other than statements of historical fact contained in this press release, including statements regarding our investment plans and anticipated returns on those investments; our future customer growth; our future results of operations and financial position; including our exit from the German market; available liquidity and access to financing sources; our business strategy, plans and objectives of management for future operations, including our international growth and omni-channel strategy; consumer activity and behaviors; developments in our technology and systems and anticipated results of those developments; and the impact of macroeconomic events, including interest rates, inflation and changes in tariffs and global trade conditions, and our response to such events, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "aim," "may," "will," "should," "expects," "plans," "anticipates," "continues," "could," "intends," "goals," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential," or the negative of these terms or other similar expressions. Forward-looking statements are based on current expectations of future events. We cannot guarantee that any forward-looking statement will be accurate, although we believe that we have been reasonable in our expectations and assumptions. Investors should realize that if underlying assumptions prove inaccurate or that known or unknown risks or uncertainties materialize, actual results could vary materially from our expectations and projections. Investors are therefore cautioned not to place undue reliance on any forward-looking statements. We believe that these risks and uncertainties include, but are not limited to, adverse macroeconomic conditions, including economic instability, changes in laws and regulations, and other governmental actions or policies, including those related to taxes and new or increased tariffs and the uncertainty surrounding potential changes in such laws and regulations or other potential governmental actions or policies, export controls, sustained higher interest rates and inflation, slower growth or the potential for recession, disruptions in the global supply chain and other conditions affecting the retail environment for products we sell, and other matters that influence consumer spending and preferences, as well as our ability to plan for and respond to the impact of these conditions; our ability to increase our net revenue per active customer; our ability to build and maintain strong brands; and our ability to expand our business and compete successfully. A further list and description of risks, uncertainties and other factors that could cause or contribute to differences in our future results include the cautionary statements herein and in our most recent Annual Report on Form 10-K and in our other filings and reports with the Securities and Exchange Commission. We qualify all of our forward-looking statements by these cautionary statements. These forward-looking statements speak only as of the date of this press release and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events or otherwise. WAYFAIR INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) March 31, December 31, 2025 2024 (in millions, except share and per share data) Assets: Current assets Cash and cash equivalents $ 1,338 $ 1,316 Short-term investments 30 56 Accounts receivable, net 140 155 Inventories 90 76 Prepaid expenses and other current assets 295 274 Total current assets 1,893 1,877 Operating lease right-of-use assets 912 925 Property and equipment, net 556 603 Other non-current assets 58 54 Total assets $ 3,419 $ 3,459 Liabilities and Stockholders' Deficit: Current liabilities Accounts payable $ 1,123 $ 1,246 Other current liabilities 1,160 1,124 Total current liabilities 2,283 2,370 Long-term debt 3,000 2,882 Operating lease liabilities, net of current 914 929 Other non-current liabilities 31 33 Total liabilities 6,228 6,214 Stockholders' deficit: Convertible preferred stock, $0.001 par value per share: 10,000,000 shares authorized and none issued at March 31, 2025 and December 31, 2024 — — Class A common stock, par value $0.001 per share, 500,000,000 shares authorized, 102,290,399 and 100,762,581 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively — — Class B common stock, par value $0.001 per share, 164,000,000 shares authorized, 24,658,295 shares issued and outstanding at March 31, 2025 and December 31, 2024 — — Additional paid-in capital 1,821 1,751 Accumulated deficit (4,623) (4,510) Accumulated other comprehensive (loss) income (7) 4 Total stockholders' deficit (2,809) (2,755) Total liabilities and stockholders' deficit $ 3,419 $ 3,459 WAYFAIR INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended March 31, 2025 2024 (in millions, except per share data) Net revenue (1) $ 2,730 $ 2,729 Cost of goods sold (2) 1,893 1,910 Gross profit 837 819 Operating expenses: Customer service and merchant fees (2) 107 117 Advertising 344 324 Selling, operations, technology, general and administrative (2) 429 534 Impairment and other related net charges 23 — Restructuring charges 56 79 Total operating expenses 959 1,054 Loss from operations (122) (235) Interest expense, net (23) (6) Other income (expense), net 10 (4) Gain on debt extinguishment 25 — Loss before income taxes (110) (245) Provision for income taxes 3 3 Net loss $ (113) $ (248) Loss per share: Basic $ (0.89) $ (2.06) Diluted $ (0.89) $ (2.06) Weighted-average number of shares of common stock outstanding used in computing per share amounts: Basic 127 120 Diluted 127 120 (1) The following tables present net revenue attributable to our reportable segments for the periods indicated: Three Months Ended March 31, 2025 2024 (in millions) U.S. net revenue $ 2,429 $ 2,391 International net revenue 301 338 Net revenue $ 2,730 $ 2,729 (2) Includes equity-based compensation and related taxes as follows: Three Months Ended March 31, 2025 2024 (in millions) Cost of goods sold $ 2 $ 3 Customer service and merchant fees 3 6 Selling, operations, technology, general and administrative 63 118 Total equity-based compensation and related taxes $ 68 $ 127 WAYFAIR INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31, 2025 2024 (in millions) Cash flows for operating activities: Net loss $ (113) $ (248) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 81 104 Equity-based compensation expense 64 119 Amortization of debt discount and issuance costs 3 3 Impairment and other related net charges 23 — Gain on debt extinguishment (25) — Other non-cash adjustments 12 (1) Changes in operating assets and liabilities: Accounts receivable, net 16 9 Inventories (14) (7) Prepaid expenses and other assets — 34 Accounts payable and other liabilities (143) (152) Net cash used in operating activities (96) (139) Cash flows for investing activities: Purchase of short- and long-term investments (18) (36) Sale and maturities of short- and long-term investments 44 15 Purchase of property and equipment (5) (13) Site and software development costs (38) (41) Net cash used in investing activities (17) (75) Cash flows from financing activities: Proceeds from issuance of debt, net of issuance costs 691 — Payments to extinguish debt (551) — Net cash provided by financing activities 140 — Effect of exchange rate changes on cash, cash equivalents and restricted cash (9) (1) Net increase (decrease) in cash, cash equivalents and restricted cash 18 (215) Cash, cash equivalents and restricted cash Beginning of period $ 1,320 $ 1,326 End of period $ 1,338 $ 1,111 Non-GAAP Financial Measures To supplement our condensed consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), this earnings release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Diluted Earnings or Loss per Share and Net Revenue Constant Currency Growth. We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We have provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure in this earnings release. We calculate Adjusted EBITDA as net income or loss before depreciation and amortization, equity-based compensation and related taxes, interest income or expense, net, other income or expense, net, provision or benefit for income taxes, non-recurring items and other items not indicative of our ongoing operating performance. Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by Net Revenue. We disclose Adjusted EBITDA because it is a key measure used by our management and board of directors to evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we believe the exclusion of certain expenses in calculating Adjusted EBITDA facilitates operating performance comparisons on a period-to-period basis as these costs may vary independent of business performance. For instance, we exclude the impact of equity-based compensation and related taxes as we do not consider this item to be indicative of our core operating performance. Investors should, however, understand that equity-based compensation and related taxes will be a significant recurring expense in our business and an important part of the compensation provided to our employees. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. We calculate Free Cash Flow as net cash provided by or used in operating activities less net cash used to purchase property and equipment and site and software development costs (collectively, "Capital Expenditures"). We disclose Free Cash Flow because it is an important indicator of our business performance as it measures the amount of cash we generate. Accordingly, we believe that Free Cash Flow provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management. We calculate Adjusted Diluted Earnings or Loss per Share as net income or loss plus equity-based compensation and related taxes, provision or benefit for income taxes, non-recurring items, other items not indicative of our ongoing operating performance, and, if dilutive, interest expense associated with convertible debt instruments under the if-converted method divided by the weighted-average number of shares of common stock used in the computation of diluted earnings or loss per share. Accordingly, we believe that these adjustments to our adjusted diluted net income or loss before calculating per share amounts for all periods presented provide a more meaningful comparison between our operating results from period to period. We calculate Net Revenue Constant Currency Growth by translating the current period local currency net revenue by the currency exchange rates used to translate the financial statements in the comparable prior-year period. We disclose Net Revenue Constant Currency Growth because it is an important indicator of our operating results. Accordingly, we believe that Net Revenue Constant Currency Growth provides useful information to investors and others in understanding and evaluating trends in our operating results in the same manner as our management. We calculate forward-looking non-GAAP financial measures based on internal forecasts that omit certain amounts that would be included in forward-looking GAAP financial measures. We do not attempt to provide a reconciliation of forward-looking non-GAAP financial measures to forward looking GAAP financial measures because forecasting the timing or amount of items that have not yet occurred and are out of our control is inherently uncertain and unavailable without unreasonable efforts. Further, we believe that such reconciliations would imply a degree of precision and certainty that could be confusing to investors. Such items could have a substantial impact on GAAP measures of financial performance. The non-GAAP financial measures have limitations as analytical tools. We do not, nor do we suggest that investors should consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors should also note that the non-GAAP financial measures we use may not be the same non-GAAP financial measures and may not be calculated in the same manner as that of other companies, including other companies in our industry. The following table reflects the reconciliation of net income or loss to Adjusted EBITDA and Adjusted EBITDA margin for each of the periods indicated: Three Months Ended March 31, 2025 2024 (in millions) Reconciliation of Adjusted EBITDA: Net loss $ (113) $ (248) Depreciation and amortization 81 104 Equity-based compensation and related taxes 68 127 Interest expense, net 23 6 Other (income) expense, net (10) 4 Provision for income taxes 3 3 Other: Impairment and other related net charges (1) 23 — Restructuring charges (2) 56 79 Gain on debt extinguishment (3) (25) — Adjusted EBITDA $ 106 $ 75 Net revenue $ 2,730 $ 2,729 Net loss margin (4.1) % (9.1) % Adjusted EBITDA Margin 3.9 % 2.7 % (1) During the three months ended March 31, 2025, we recorded net charges of $23 million, inclusive of $20 million associated with the Germany Restructuring and weakened macroeconomic conditions in connection with our German operations and $3 million associated with changes in sublease market conditions for a technology center in the U.S. (2) During the three months ended March 31, 2025, we incurred $56 million of aggregate charges consisting primarily of one-time employee severance, benefits, relocation and transition costs. This was inclusive of $40 million related to the Germany Restructuring and $16 million related to the March 2025 workforce reductions. During the three months ended March 31, 2024, we incurred $79 million of charges consisting primarily of one-time employee severance and benefit costs associated with the January 2024 workforce reductions. (3) During the three months ended March 31, 2025, we recorded a $25 million gain on debt extinguishment upon repurchase of $578 million in aggregate principal amount of the 2026 Notes. The following table presents Adjusted EBITDA attributable to our segments, and the reconciliation of net income or loss to Adjusted EBITDA is presented in the preceding table: Three Months Ended March 31, 2025 2024 (in millions) Segment Adjusted EBITDA: US $ 95 $ 121 International 11 (46) Adjusted EBITDA $ 106 $ 75 The following table presents a reconciliation of net cash provided by or used in operating activities to Free Cash Flow for each of the periods indicated: Three Months Ended March 31, 2025 2024 (in millions) Net cash used in operating activities $ (96) $ (139) Purchase of property and equipment (5) (13) Site and software development costs (38) (41) Free Cash Flow $ (139) $ (193) A reconciliation of the numerator and denominator for diluted earnings or loss per share, the most directly comparable GAAP financial measure, to the numerator and denominator for Adjusted Diluted Earnings or Loss per Share, in order to calculate Adjusted Diluted Earnings or Loss per Share is as follows: Three Months Ended March 31, 2025 2024 (in millions, except per share data) Numerator: Numerator for basic and diluted loss per share - net loss $ (113) $ (248) Adjustments to net loss Equity-based compensation and related taxes 68 127 Provision for income taxes 3 3 Other: Impairment and other related net charges 23 — Restructuring charges 56 79 Gain on debt extinguishment (25) — Numerator for Adjusted Diluted Earnings (Loss) per Share - Adjusted net income (loss) $ 12 $ (39) Denominator: Denominator for basic and diluted loss per share - weighted-average number of shares of common stock outstanding 127 120 Denominator for Adjusted Diluted Earnings (Loss) per Share - Adjusted weighted-average number of shares of common stock outstanding after the effect of dilutive securities 127 120 Diluted Loss per Share $ (0.89) $ (2.06) Adjusted Diluted Earnings (Loss) per Share $ 0.10 $ (0.32) SOURCE Wayfair Inc. WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

Wayfair Announces First Quarter 2025 Results, Reports Further Share Capture with Robust Profitability

FAQ

Why Neutral?

How important is it?

Why Short Term?

Related Companies

Related News