Wayfair on Wednesday said it posted its strongest quarter of sales growth since the pandemic as the furniture retailer continues to win over customers and take market share.
The company said it saw double-digit revenue growth in the U.S., reaching about $3 billion, an 11.4% increase from the year prior. Still, international net revenue for the quarter decreased 2.3% year over year to $380 million.
Wayfair’s stock closed about 11% higher on Wednesday.
The report comes as the housing market remains sluggish. But the furniture and home goods retailer has reported consistent growth over the past year. CFO Kate Gulliver told CNBC that Wayfair’s momentum is building as it takes market share.
“We see the overall consumer in the U.S. in this category, we think it’s roughly flattish, and so that’s our [market] share momentum continuing to build,” Gulliver said.
She added that shopper loyalty, the opening of new stores, the company’s luxury furniture business and an emphasis on value has allowed Wayfair to win more consumers. Customers are also continuing to spend, whether at the company’s value prices or on the luxury side, she added.
“We’ve been highly promotional for the last few years, and the promotional activity this year is actually very consistent with last year,” she said. “It maintains this sort of momentum on promotional activity this year.”
Here’s how the company performed in its third quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
- Earnings per share: 93 cents adjusted vs. 79 cents expected
- Revenue: $3.42 billion vs. $3.38 billion expected
For the period ended Sept. 30, Wayfair reported net income of $62 million, or 45 cents per share, compared with a loss of $99 million, or 76 cents per share, the year prior.
Total revenue grew 9.7% year over year, reaching $3.42 billion.
The company said its active customers grew 4.7% year over year, reaching 22.2 million. It also saw a 12.2% increase in orders delivered during the quarter to about 11 million.
As the company looks ahead to the holiday season and the fourth quarter, Gulliver said it’s maintaining promotional activity similar to last year. She added that Wayfair is confident that its range of prices and products will appeal to a broad base of consumers.
“We’ve seen that growth play out,” Gulliver said. “We’ve seen that flow through to EBITDA, ultimately to net income positive this quarter, which is really another key piece in the story and the momentum here, so we feel very good about the quarter of the performance.”
