Wayfair Inc. (W - Free Report) reported fourth-quarter 2020 non-GAAP earnings of $1.24 per share, which surpassed the Zacks Consensus Estimate of 91 cents.
Total revenues came in at $3.67 billion, up 44.9% year over year. However, the figure missed the Zacks Consensus Estimate of $3.75 billion.
The year-over-year increase in revenues was driven by strong acceleration in new and repeat customer orders. Also, increase in active customers and strength in the company's direct retail business aided year-over-year revenue growth.
Quarter in Detail
Net revenues in the United States increased 40.1% year over year to $3 billion and international net revenues grew 70.7% to $671.8 million.
Active customers increased 53.7% from the prior-year quarter to 31.2 million. Moreover, LTM net revenues per active customer increased 1.1% year over year to $453 million.
Total number of orders delivered in the reported quarter was 16.5 million, up 47.1% year over year. In addition, orders per customer for the quarter were 1.96 million, reflecting an increase of 5.4% from the year-ago period. Further, repeat customers placed 11.9 million orders in the fourth quarter, up 55.6% year over year.
Operating Results
For the fourth quarter, Wayfair’s gross margin was 29%, up 620 basis points on a year-over-year basis.
Adjusted EBITDA margin was 7.2% versus (7.1%) in the year-ago quarter.
The company’s operating expenses of $827.3 million increased 5.8% year over year. Operating income was $100.6 million versus the prior-year loss of $305.4 million.
Balance Sheet & Cash Flow
At fourth quarter-end, cash, cash equivalents and short-term investments were $2.6 billion, flat with the prior quarter. Accounts receivables were $110.3 million, up from $109.7 million in the third quarter.
Cash from operations was $206.7 million and capital expenditure totaled $39.7 million. Free cash flow was $128.3 million compared with $255 million in the third quarter.
Zacks Rank and Stocks to Consider
Wayfair currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Semtech Corporation (SMTC - Free Report) , KLA Corporation (KLAC - Free Report) and Facebook , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth for Semtech, KLA Corp., and Facebook is currently projected at 12.5%, 11.6%, and 19.2%, respectively.
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Wayfair Inc. (W - Free Report) reported fourth-quarter 2020 non-GAAP earnings of $1.24 per share, which surpassed the Zacks Consensus Estimate of 91 cents.
Total revenues came in at $3.67 billion, up 44.9% year over year. However, the figure missed the Zacks Consensus Estimate of $3.75 billion.
The year-over-year increase in revenues was driven by strong acceleration in new and repeat customer orders. Also, increase in active customers and strength in the company's direct retail business aided year-over-year revenue growth.
Quarter in Detail
Net revenues in the United States increased 40.1% year over year to $3 billion and international net revenues grew 70.7% to $671.8 million.
Active customers increased 53.7% from the prior-year quarter to 31.2 million. Moreover, LTM net revenues per active customer increased 1.1% year over year to $453 million.
Total number of orders delivered in the reported quarter was 16.5 million, up 47.1% year over year. In addition, orders per customer for the quarter were 1.96 million, reflecting an increase of 5.4% from the year-ago period. Further, repeat customers placed 11.9 million orders in the fourth quarter, up 55.6% year over year.
Operating Results
For the fourth quarter, Wayfair’s gross margin was 29%, up 620 basis points on a year-over-year basis.
Adjusted EBITDA margin was 7.2% versus (7.1%) in the year-ago quarter.
The company’s operating expenses of $827.3 million increased 5.8% year over year. Operating income was $100.6 million versus the prior-year loss of $305.4 million.
Balance Sheet & Cash Flow
At fourth quarter-end, cash, cash equivalents and short-term investments were $2.6 billion, flat with the prior quarter. Accounts receivables were $110.3 million, up from $109.7 million in the third quarter.
Cash from operations was $206.7 million and capital expenditure totaled $39.7 million. Free cash flow was $128.3 million compared with $255 million in the third quarter.
Zacks Rank and Stocks to Consider
Wayfair currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Semtech Corporation (SMTC - Free Report) , KLA Corporation (KLAC - Free Report) and Facebook , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth for Semtech, KLA Corp., and Facebook is currently projected at 12.5%, 11.6%, and 19.2%, respectively.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.9% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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