Wayfair’s Q2 sales, customers grow even as loss widens
Wayfair’s loss grew in the second quarter amid increased operating costs.
The online home furnishings retailer reported a loss of $181.93 million, or $1.98 per share, for the quarter ended June 30, compared with a loss of $100.73 million, or $1.13 a share, a year ago. Excluding one-time items, Wayfair reported a loss of $1.35 per share, in line with Street expectations.
Sales rose 42.1% to $2.34 billion, more than analysts had expected. The number of active customers in its direct retail business increased 39.1% to 17.8 million. It delivered 9.2 million orders, up 42% over the same quarter last year. The average order was $255, compared to $254 last year.
Wayfair’s operating expenses rose 52% to $730.8 million from $480.3 million a year ago amid increased investments in customer service, advertising, technology and other operating fees. The company, which has consistently reported double-digit revenue growth, has yet to turn a profit.
“While Wayfair is expert at driving sales growth, it remains terrible at translating this into profitable gains,” commented analyst Neil Saunders, managing director, GlobalData Retail. “Indeed, despite a leap in second-quarter revenue, the company’s net losses grew to a whopping $182 million. Crudely, that means that for every order placed, the company is making a loss of $19.71. In our view, this is far from sustainable and raises questions about the long-term viability of the business.” (For more commentary, click here.)
Wayfair will open its first full-service store this fall, at the Natick Mall in Natick, Massachusetts this fall. The opening comes on the heels of several Wayfair pop-up shops.
In a statement, Wayfair co-founder and CEO Niraj Shah struck a confident note.
“As we continue to strengthen our global logistics network through the addition of Castlegate warehouses and last-mile delivery facilities, we are driving cost efficiencies and building an unparalleled experience for our customers with even faster delivery,” he said. “We look forward to building on this tremendous momentum as we continue to scale our operations and capture an out-sized share of the consumer spending moving online in our market segment.”
The online home furnishings retailer reported a loss of $181.93 million, or $1.98 per share, for the quarter ended June 30, compared with a loss of $100.73 million, or $1.13 a share, a year ago. Excluding one-time items, Wayfair reported a loss of $1.35 per share, in line with Street expectations.
Sales rose 42.1% to $2.34 billion, more than analysts had expected. The number of active customers in its direct retail business increased 39.1% to 17.8 million. It delivered 9.2 million orders, up 42% over the same quarter last year. The average order was $255, compared to $254 last year.
Wayfair’s operating expenses rose 52% to $730.8 million from $480.3 million a year ago amid increased investments in customer service, advertising, technology and other operating fees. The company, which has consistently reported double-digit revenue growth, has yet to turn a profit.
“While Wayfair is expert at driving sales growth, it remains terrible at translating this into profitable gains,” commented analyst Neil Saunders, managing director, GlobalData Retail. “Indeed, despite a leap in second-quarter revenue, the company’s net losses grew to a whopping $182 million. Crudely, that means that for every order placed, the company is making a loss of $19.71. In our view, this is far from sustainable and raises questions about the long-term viability of the business.” (For more commentary, click here.)
Wayfair will open its first full-service store this fall, at the Natick Mall in Natick, Massachusetts this fall. The opening comes on the heels of several Wayfair pop-up shops.
In a statement, Wayfair co-founder and CEO Niraj Shah struck a confident note.
“As we continue to strengthen our global logistics network through the addition of Castlegate warehouses and last-mile delivery facilities, we are driving cost efficiencies and building an unparalleled experience for our customers with even faster delivery,” he said. “We look forward to building on this tremendous momentum as we continue to scale our operations and capture an out-sized share of the consumer spending moving online in our market segment.”