Wayfair Announces Third Quarter 2024 Results, Reports Strong Profitability in Tandem with Further Market Share Gains
Q3 Net Revenue of $2.9 billion with 21.7 million Active Customers
BOSTON, Nov. 1, 2024 /PRNewswire/ -- Wayfair Inc. ("Wayfair," "we," or "our") (NYSE:W), one of the world's largest destinations for the home, today reported financial results for its third quarter ended September 30, 2024.
Third Quarter 2024 Financial Highlights
Total net revenue of $2.9 billion, decreased $60 million, down 2.0% year over year
U.S. net revenue of $2.5 billion, decreased $60 million, down 2.3% year over year
International net revenue of $372 million and International Net Revenue Constant Currency Growth remained constant year over year
Gross profit was $873 million, or 30.3% of total net revenue
Net loss was $74 million and Non-GAAP Adjusted EBITDA was $119 million
Diluted loss per share was $0.60 and Non-GAAP Adjusted Diluted Earnings Per Share was $0.22
Net cash provided by operating activities was $49 million and Non-GAAP Free Cash Flow was ($9) million
Cash, cash equivalents and short-term investments totaled $1.3 billion and total liquidity was $1.9 billion, including availability under our revolving credit facility
"Q3 marked another proofpoint of resilience for Wayfair with further market share capture in the face of sustained challenges in the category. Once again, we navigated a dynamic consumer environment while driving further discipline on costs to achieve a mid-single-digit Adjusted EBITDA margin for the second quarter in a row. As I've mentioned before, our north star is driving Adjusted EBITDA dollars in excess of equity-based compensation and capital expenditures, and we're pleased to be making noteworthy improvements across each of these fronts," said Niraj Shah, CEO, co-founder and co-chairman, Wayfair.
Shah continued, "We remain laser-focused on delivering healthy profitability while setting ourselves up for success as the category rebounds. The core goal across each of our initiatives in 2024 is to foster customer loyalty and spur repeat business while driving economic value. We're not just aiming for short-term gains, but building long-lasting relationships with our customers that will be accretive on both the top and bottom lines."
Other Third Quarter Highlights
Active customers totaled 21.7 million as of September 30, 2024, a decrease of 2.7% year over year
LTM net revenue per active customer was $545 as of September 30, 2024, an increase of 1.3% year over year
Orders per customer, measured as LTM orders divided by active customers, was 1.85 for the third quarter of 2024, compared to 1.83 for the third quarter of 2023
Orders delivered in the third quarter of 2024 were 9.3 million, a decrease of 6.1% year over year
Repeat customers placed 79.9% of total orders delivered in the third quarter of 2024, compared to 79.7% in the third quarter of 2023
Repeat customers placed 7.4 million orders in the third quarter of 2024, a decrease of 6.3% year over year
Average order value was $310 in the third quarter of 2024, compared to $297 in the third quarter of 2023
63.0% of total orders delivered were placed via a mobile device in the third quarter of 2024, compared to 61.7% in the third quarter of 2023
Key Financial Statement and Operating Metrics
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions, except LTM net revenue per active customer, average order value and per share data)
Key Financial Statement Metrics:
Net revenue
$ 2,884
$ 2,944
$ 8,730
$ 8,889
Gross profit
$ 873
$ 917
$ 2,633
$ 2,723
Loss from operations
$ (74)
$ (152)
$ (344)
$ (641)
Net loss
$ (74)
$ (163)
$ (364)
$ (564)
Loss per share:
Basic
$ (0.60)
$ (1.40)
$ (2.98)
$ (4.99)
Diluted
$ (0.60)
$ (1.40)
$ (2.98)
$ (4.99)
Net cash provided by operating activities
$ 49
$ 121
$ 155
$ 191
Key Operating Metrics:
Active customers (1)
22
22
22
22
LTM net revenue per active customer (2)
$ 545
$ 538
$ 545
$ 538
Orders delivered (3)
9
10
29
30
Average order value (4)
$ 310
$ 297
$ 303
$ 297
Non-GAAP Financial Measures:
Adjusted EBITDA
$ 119
$ 100
$ 357
$ 214
Free Cash Flow
$ (9)
$ 42
$ (19)
$ (64)
Adjusted Diluted Earnings (Loss) per Share
$ 0.22
$ (0.13)
$ 0.38
$ (1.02)
(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 third quarter 2024 financial results today at 8 a.m. (ET). Investors and participants should register for the call in advance by visiting https://bit.ly/3AjK2fc. After registering, instructions will be shared on how to join the call. The call will also be available via live webcast at https://bit.ly/4hfCcE7. 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: All of 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 $11.8 billion in net revenue for the twelve months ended September 30, 2024 and is headquartered in Boston, Massachusetts with global operations.
Media Relations Contact:Tara
Investor Relations Contact:James
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 financial outlook, profitability goals, business strategy, plans and objectives of management for future operations, and, the impact of macroeconomic events and our response to such events, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "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 rising and fluctuating interest rates and inflation, slower growth or the potential for recession, disruptions in the global supply chain, 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 acquire and retain customers in a cost-effective manner; our ability to increase our net revenue per active customer; our ability to build and maintain strong brands; our ability to manage our growth and expansion initiatives; 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)
September 30,
December 31,
2024
2023
(in millions, except share and pershare data)
Assets:
Current assets
Cash and cash equivalents
$ 1,296
$ 1,322
Short-term investments
32
29
Accounts receivable, net
155
140
Inventories
81
75
Prepaid expenses and other current assets
248
289
Total current assets
1,812
1,855
Operating lease right-of-use assets
888
820
Property and equipment, net
658
748
Other non-current assets
56
51
Total assets
$ 3,414
$ 3,474
Liabilities and Stockholders' Deficit:
Current liabilities
Accounts payable
$ 1,187
$ 1,234
Other current liabilities
982
949
Total current liabilities
2,169
2,183
Long-term debt
3,061
3,092
Operating lease liabilities, net of current
884
862
Other non-current liabilities
33
44
Total liabilities
6,147
6,181
Stockholders' deficit:
Convertible preferred stock, $0.001 par value per share: 10,000,000 shares authorized and
