Wayfair posts positive EBITDA; Q2 sales decline

Global online furniture retailer Wayfair has reported a decline in second quarter sales as active customer numbers also fell.

According to its latest Q2 trading update ended 30 June 2023, total net revenue of $3.2bn decreased $113m, down 3.4% year-over-year. US sales fell 0.4% to $2.8bn, while International revenues decreased 20.9% to $386m.

Gross profit was $985m, or 31.1% of total net revenue, with Adjusted EBITDA resulting at $128m, an improvement from a loss of $108m, although net losses stood at $46m. Net cash position was $217m.

During the period Wayfair saw customer numbers drop 7.6% to 21.8 million, although orders delivered increased 3% to 10.3 million with repeat customers placing 80.1% of total orders.

As for Wayfair’s half year results, covering a six month period, total sales were down to $5.9bn from $6.2bn, with net losses narrowing from $697m to $401m.

Niraj Shah CEO, co-founder and co-chairman, Wayfair, commented: “Last year, we laid out a plan to strengthen our business that included a path to sustainable and growing profitability with several key milestones. For the past few quarters, you’ve seen us execute against that plan – to lower our costs, focus on the basics and earn more customer and supplier loyalty. And you’ve seen the tangible impact of this plan as our performance has continued to improve. I’m pleased to share today that we’ve passed one of our key milestones and we are reporting positive adjusted EBITDA and positive free cash flow.

“This is in combination with a return to momentum in our top line with positive year-over-year order growth, and sequentially higher active customer count, all while investing into initiatives for future growth. This is how we ran the business for our first decade and how we’ll continue to do so going forward – profitable, while investing for growth. We think we are now in a very exciting place – having scale while remaining ambitious and entrepreneurial – and we plan to take full advantage of this.”

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