Wayfair Sales Increase by 10%; This Furniture Retailer Claims It's Gaining Market Share in a Downturn
CNBC
58m ago
Ai Focus
Wayfair stated on Wednesday that the company achieved its strongest quarterly sales growth since the outbreak of the pandemic, driven by double-digit growth in its U.S. business. Both revenue and earnings per share in the third quarter exceeded Wall Street's expectations. CFO Kate Gulliver claimed that the company is continuing to gain market share through store expansion, its luxury furniture business, and a strategy that emphasizes cost-effectiveness.
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Wayfair reported on Wednesday that as this furniture retailer continues to attract customers and gain market share, the company has recorded its strongest quarterly sales growth since the pandemic.

The company stated that its U.S. business achieved double-digit revenue growth, reaching approximately $3 billion, an increase of 11.4% compared to the same period last year. However, international net revenue decreased by 2.3% year-on-year for that quarter, to $380 million.

At the time of this report's release, the real estate market remains sluggish. However, this furniture and home goods retailer has been reporting steady growth over the past year. Chief Financial Officer Kate Gulliver told CNBC that as Wayfair continues to capture market share, the company's growth momentum is strengthening.

Gulliver said, "We observe that the overall consumer demand for this category in the United States is roughly stable, which is why we see a continuous increase in our [market] share momentum."

She added that customer loyalty, the opening of new stores, the company's high-end furniture business, and an emphasis on value for money have helped the company win over more consumers. She also stated that customers continue to spend, whether on the company's affordable products or on its high-end products.

She said, "Over the past few years, we have maintained a high level of promotional efforts, and this year's promotional activities are actually very consistent with last year's. It has sustained the momentum of these promotional activities throughout this year."

The following is a comparison of Wayfair's third-quarter performance with Wall Street's expectations, based on the survey of analysts conducted by LSEG.

  • Earnings per share: 93 cents after adjustment, expected to be 79 cents.
  • Revenue: $3.42 billion, expected to be $3.38 billion.

For the period ending September 30, Wayfair recorded a net profit of 62 million US dollars, which is 45 cents per share; in the same period last year, there was a net loss of 99 million US dollars, or a loss of 76 cents per share.

Total revenue increased by 9.7% year-on-year, reaching $3.42 billion.

The company stated that the number of active customers increased by 4.7% year-on-year, reaching 22.2 million. During the same period, the number of orders delivered also grew by 12.2%, amounting to approximately 11 million orders.

Looking ahead to the holiday season and the fourth quarter, Gulliver stated that the company will maintain promotional activities similar to those of last year. She added that the company is confident that its pricing and product portfolio will be able to attract a wide range of consumers.

Gulliver said, "We have already seen this growth manifest itself. We have also observed that it has been transmitted to EBITDA, and ultimately, we achieved a positive net profit for this quarter, which is another key aspect of this story and the current momentum. Therefore, we are very satisfied with our performance this quarter."

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