BOSTON — Online home goods seller Wayfair showed signs of improvement in its fourth quarter as total net revenue inched up by $13 million for a 0.4% year-over-year gain to reach $3.1 billion.
The company, which does business under the Wayfair, Joss & Main, AllModern, Birch Lane, Perigold and Wayfair Professional nameplates, also saw its active customer numbers jump by 1.4% to reach 22.4 million as of Dec. 31.
Orders per customer rose to 1.84 in Q4 2023 vs. 1.81 in the same quarter in 2022, and there were more repeat customers ordering in the fourth quarter: 79.4% vs. 77.4% in Q4 2023. However, net revenue per active customer decreased by 3% vs. last year to $537 for the fourth quarter, and average order value per customer fell to $276 in Q4 from $283 a year ago.
Total revenue for the quarter was made up by $2.7 billion in U.S. net revenue, which rose by 0.9% over last year for the quarter ended Dec. 31. International remained down, however, falling by 2.7% vs. last year to account for $404 million in net revenue.
Gross profit for the quarter was $944 million, or 30.3% of total net revenue, while net loss was $174 million. Non-GAAP adjusted EBITDA was $92 million.
“Q4 was another definitive step on our profitability journey and a reflection of the immense progress we achieved through the entire year,” said Niraj Shah, CEO, co-founder and co-chairman. “Our efforts over 2023 led to large improvements in our core recipe across availability, speed and price competitiveness. These improvements were directly responsible for our robust share expansion throughout the year and for the step-up we saw in customer loyalty, including year-over-year growth in our active customer count by the fourth quarter.”
In the company’s earnings call, Shah noted that the home category “remains challenged” and, reflecting on comments he heard when attending Las Vegas Market, said January was weaker than expected, in part because of weather across the United States.
But despite the current economic macros, Shah expects Wayfair, which has been taking share from competitors for five quarters, to continue along that route. “We’re taking share while it’s really hard to take share,” he said, and he only expects it to get better as the category recovers.
As to how they are handling market volatility, Shah said, “Our focus is on controlling the controllable.” One such challenge he addressed was shipping issues within the Red Sea. While it is causing supply chain disruptions, especially for product headed to Europe, Shah said it hasn’t reached the level of 2021, either with slowdowns or increased container costs.
For the year, Wayfair’s total net revenue of $12 billion was down $215 million, or 1.8%, year-over-year; U.S. net revenue gained $18 million to end up at $10.5 billion for a 0.2% increase.
Gross profit for the year was $3.7 billion, or 30.6% of total net revenue, while net loss was $738 million and non-GAAP adjusted EBITDA was $306 million. The diluted loss per share was $6.47; non-GAAP adjusted diluted loss per share was $1.13.
See also:
- Wayfair gives shoppers immersive experience using Apple Vision Pro
- Wayfair makes deep cuts to workforce in move to accelerate profitability
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