Advertisement
Canada markets open in 6 hours 12 minutes
  • S&P/TSX

    21,639.10
    -59.00 (-0.27%)
     
  • S&P 500

    5,431.60
    -2.14 (-0.04%)
     
  • DOW

    38,589.16
    -57.94 (-0.15%)
     
  • CAD/USD

    0.7280
    -0.0004 (-0.05%)
     
  • CRUDE OIL

    78.18
    -0.27 (-0.34%)
     
  • Bitcoin CAD

    90,602.70
    -447.67 (-0.49%)
     
  • CMC Crypto 200

    1,393.51
    +5.35 (+0.39%)
     
  • GOLD FUTURES

    2,334.00
    -15.10 (-0.64%)
     
  • RUSSELL 2000

    2,006.16
    -32.75 (-1.61%)
     
  • 10-Yr Bond

    4.2130
    -0.0250 (-0.59%)
     
  • NASDAQ futures

    19,711.25
    +25.75 (+0.13%)
     
  • VOLATILITY

    12.66
    0.00 (0.00%)
     
  • FTSE

    8,174.82
    +27.96 (+0.34%)
     
  • NIKKEI 225

    38,102.44
    -712.12 (-1.83%)
     
  • CAD/EUR

    0.6802
    +0.0004 (+0.06%)
     

Wayfair (W) Q1 Loss Narrower Than Expected, Revenues Decline Y/Y

Wayfair W reported a non-GAAP loss of $1.13 per share for first-quarter 2023, narrower than the Zacks Consensus Estimate for a loss of $1.72 per share. The figure was also narrower than the loss of $1.96 per share reported in the year-ago quarter.

Total net revenues of $2.77 billion beat the consensus mark of $2.74 billion. However, the top line declined 7.3% year over year.

The top-line decrease was due to declining domestic and international revenues. A fall in active customers affected the results.

Quarter in Detail

Net revenues in the United States decreased 5% year over year to $2.4 billion. International net revenues declined 20.4% from the prior-year quarter’s figure to $359 million.

Active customers were down 14.6% year over year to 21.7 million. In addition, LTM net revenues per active customer increased 6.2% year over year to $552. The average order value remained flat year over year at $287.

The total number of orders delivered in the reported quarter was 9.7 million, down 6.7% year over year. In addition, orders per customer for the quarter were 1.81 compared with 1.87 in the year-ago period.

Repeat customers placed 7.6 million orders (accounting for 79.1% of total orders) in the first quarter, down 6.2% year over year.

Additionally, 62.1% of the total orders delivered were placed through a mobile device in the reported quarter compared with 59.4% in the year-ago period.

Wayfair Inc. Price, Consensus and EPS Surprise

 

Wayfair Inc. Price, Consensus and EPS Surprise
Wayfair Inc. Price, Consensus and EPS Surprise

Wayfair Inc. price-consensus-eps-surprise-chart | Wayfair Inc. Quote

Operating Results

Wayfair’s first-quarter gross margin was 29.6%, expanding 280 basis points on a year-over-year basis.

Adjusted EBITDA was ($14) million versus ($113) million in the year-ago quarter.

Customer service and merchant fees decreased 7.9% year over year to $139 million.

Advertising expenses fell 2.7% from the prior-year quarter’s level to $327 million. Selling, operations, technology, and general and administrative expenses decreased 0.3% year over year to $624 million.

Wayfair incurred an operating loss of $347 million in the reported quarter compared with an operating loss of $310 million in the year-ago quarter.

Balance Sheet & Cash Flow

As of Mar 31, 2023, cash, cash equivalents, and short-term investments were $1.05 billion, down from $1.28 billion as of Dec 31, 2022.

Long-term debt as of Mar 31, 2023, was $3.138 billion compared with $3.137 billion as of Dec 31, 2022.

In the first quarter, cash used in operations was $147 million against $98 million of cash generated from operations in the prior quarter.

Wayfair generated a negative free cash flow of $234 million.

Zacks Rank & Stocks to Consider

Currently, Wayfair has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the retail-wholesale sector are The Kroger Co. KR, Ulta Beauty ULTA and Rush Enterprises RUSHA. All three companies currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Kroger has gained 9.9% on a year-to-date basis. The long-term earnings growth rate for KR is projected at 5.99%.

Ulta Beauty has gained 10.4% on a year-to-date basis. The long-term earnings growth rate for ULTA is projected at 12.26%.

Rush Enterprises has lost 2.9% on a year-to-date basis. The long-term earnings growth rate for RUSHA is projected at 15%.

ADVERTISEMENT

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

The Kroger Co. (KR) : Free Stock Analysis Report

Ulta Beauty Inc. (ULTA) : Free Stock Analysis Report

Rush Enterprises, Inc. (RUSHA) : Free Stock Analysis Report

Wayfair Inc. (W) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research