of Wayfair Sales fell during its first quarter, but the online furniture retailer narrowed its losses after cutting its workforce by 13 percent at the start of the year, the company announced Thursday.
Wayfair beat Wall Street expectations on the top and bottom lines and saw active customers grow nearly 3% from the year-ago period.
Here’s how Wayfair fared compared to Wall Street’s expectations, based on a survey of LSEG analysts:
- Loss per share: A loss of 32 cents adjusted vs. an expected loss of 44 cents.
- Income: $2.73 billion vs. $2.64 billion expected
Shares of Wayfair rose more than 17 percent in premarket trading Thursday.
The company’s net loss for the three-month period ended March 31 was $248 million, or $2.06 per share, compared with a loss of $355 million, or $3.22 per share, a year earlier. Excluding one-time items, the company lost 32 cents per share.
Sales fell to $2.73 billion, down 1 percent from $2.77 billion a year ago. The sharpest drop-off came from Wayfair’s international division, where sales fell nearly 6% to $338 million from the year-ago period.
Despite the drop in sales, co-founder and CEO Neeraj Shah struck a positive note in a news release, saying the quarter “ended on a positive note.”
“Shoppers are increasingly choosing Wayfair, with year-over-year active customer growth once again positive and accelerating compared to the previous quarter,” said Shah.
“For the first time post-pandemic, we are seeing suppliers introducing large groups of new products into their catalogs as they look to build momentum for the next phase of growth,” he added.
Like its other digitally native peers, Wayfair implemented a series of layoffs after seeing sales spike during the pandemic and then shrinking as customers turned to new diners after the end of the Covid-19 pandemic. Started trading in sofas and shelves.
In January, it announced plans to cut 13 percent of its global workforce, or about 1,650 employees, to reduce its structure after going “overboard” with corporate hiring during the pandemic. and reduce costs, the company previously said. The restructuring — the third Wayfair has implemented since the summer of 2022 — was expected to save the company about $280 million, it previously said.
Wayfair is still on track for profitability, but it narrowed its losses by $107 million during the first quarter after implementing the latest round of job cuts. It also increased its active customer base at a time when the home goods sector is under pressure from high interest rates and a sluggish housing market.
During the quarter, Wayfair’s active users rose 2.8% to 22.3 million, slightly ahead of the 22.1 million analysts had expected, according to StreetAccount.
On average, orders were valued at $285 during the quarter, compared with the $275.07 that analysts had expected, according to StreetAccount. While average orders exceeded Wall Street expectations, they fell slightly from the year-ago period, when the average order price was $287. That’s due to changes in Wayfair’s unit prices, which spiked in 2021 and 2022 and started to come down last year, the company said.
Read the full earnings release Here.
Credit : www.cnbc.com
