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Wayfair (W) Q1 Loss Wider Than Expected, Revenues Fall Y/Y
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Wayfair (W - Free Report) reported non-GAAP loss of $1.96 per share for first-quarter 2022, wider than the Zacks Consensus Estimate of a loss of $1.55. Further, the figure came against earnings of $1 per share in the prior-year quarter. Also, the figure worsened from the loss of 92 cents in the previous quarter.
Total net revenues were $2.99 billion, which declined 13.9% year over year and 8% sequentially. The top line missed the consensus mark by 0.3%.
The top-line decrease was a result of declining domestic and international revenues. Further, a fall in active customers affected the results.
Net revenues in the United States decreased 9.9% year over year to $2.5 billion. International net revenues also decreased 31.4% from the prior-year quarter’s figure to $0.5 billion. On a constant-currency basis, international net revenue growth was (29.6)%.
Active customers were down 23.4% year over year to 25.4 million. In addition, LTM net revenues per active customer increased 12.8% year over year to $520. Average order value climbed 21.1% year over year to $287.
Total number of orders delivered in the reported quarter were 10.4 million, down 29% year over year. In addition, orders per customer for the quarter were 1.87 compared with 1.98 million in the year-ago period.
Further, repeat customers placed 8.1 million orders (accounting for 77.7% of total orders) in the first quarter, down 26% year over year.
Additionally, 59.4% of total orders delivered were placed through a mobile device in the reported quarter compared with 60% in the year-ago period.
Operating Results
Wayfair’s first-quarter gross margin was 26.8%, contracting 200 basis points on a year-over-year basis.
Adjusted EBITDA was $($113) million versus $206 million in the year-ago quarter.
Customer service and merchant fees increased 2.7% year over year to $151 million. Advertising expenses declined 8.2% from the prior-year quarter’s level to $336 million. Selling, operations, technology, and general and administrative expenses increased 38.5% year over year to $626 million.
Wayfair incurred an operating loss of $310 million for the reported quarter against an operating income of $26 million in the year-ago quarter.
Balance Sheet & Cash Flow
As of Mar 31, 2022, cash, cash equivalents and short-term investments were $1.99 billion, down from $2.4 billion reported on Dec 31, 2021.
Long-term debt as of Mar 31, 2022 was $3.054 billion compared with $3.0452 billion on Dec 31, 2021.
In the first quarter, net cash used in operations was $226 million compared with net cash generated from operations of $89 million in the prior quarter.
Wayfair generated free cash flow of ($331) million.
Zacks Rank & Stocks to Consider
Wayfair currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail-wholesale sector are AutoNation (AN - Free Report) , Costco Wholesale (COST - Free Report) and Dollar Tree (DLTR - Free Report) . While AutoNation sports a Zacks Rank #1 (Strong Buy), Costco Wholesale and Dollar Tree carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
AutoNation has gained 16.3% over a year. The long-term earnings growth rate for AN is currently projected at 23.6%.
Shares of Costco Wholesale have rallied 33.4% over a year. The long-term earnings growth rate for COST is currently projected at 9.1%.
Dollar has gained 39.9% over a year. The long-term earnings growth rate for DLTR is currently projected at 15.5%.
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Wayfair (W) Q1 Loss Wider Than Expected, Revenues Fall Y/Y
Wayfair (W - Free Report) reported non-GAAP loss of $1.96 per share for first-quarter 2022, wider than the Zacks Consensus Estimate of a loss of $1.55. Further, the figure came against earnings of $1 per share in the prior-year quarter. Also, the figure worsened from the loss of 92 cents in the previous quarter.
Total net revenues were $2.99 billion, which declined 13.9% year over year and 8% sequentially. The top line missed the consensus mark by 0.3%.
The top-line decrease was a result of declining domestic and international revenues. Further, a fall in active customers affected the results.
Wayfair Inc. Price, Consensus and EPS Surprise
Wayfair Inc. price-consensus-eps-surprise-chart | Wayfair Inc. Quote
Top-Line Details
Net revenues in the United States decreased 9.9% year over year to $2.5 billion. International net revenues also decreased 31.4% from the prior-year quarter’s figure to $0.5 billion. On a constant-currency basis, international net revenue growth was (29.6)%.
Active customers were down 23.4% year over year to 25.4 million. In addition, LTM net revenues per active customer increased 12.8% year over year to $520. Average order value climbed 21.1% year over year to $287.
Total number of orders delivered in the reported quarter were 10.4 million, down 29% year over year. In addition, orders per customer for the quarter were 1.87 compared with 1.98 million in the year-ago period.
Further, repeat customers placed 8.1 million orders (accounting for 77.7% of total orders) in the first quarter, down 26% year over year.
Additionally, 59.4% of total orders delivered were placed through a mobile device in the reported quarter compared with 60% in the year-ago period.
Operating Results
Wayfair’s first-quarter gross margin was 26.8%, contracting 200 basis points on a year-over-year basis.
Adjusted EBITDA was $($113) million versus $206 million in the year-ago quarter.
Customer service and merchant fees increased 2.7% year over year to $151 million. Advertising expenses declined 8.2% from the prior-year quarter’s level to $336 million. Selling, operations, technology, and general and administrative expenses increased 38.5% year over year to $626 million.
Wayfair incurred an operating loss of $310 million for the reported quarter against an operating income of $26 million in the year-ago quarter.
Balance Sheet & Cash Flow
As of Mar 31, 2022, cash, cash equivalents and short-term investments were $1.99 billion, down from $2.4 billion reported on Dec 31, 2021.
Long-term debt as of Mar 31, 2022 was $3.054 billion compared with $3.0452 billion on Dec 31, 2021.
In the first quarter, net cash used in operations was $226 million compared with net cash generated from operations of $89 million in the prior quarter.
Wayfair generated free cash flow of ($331) million.
Zacks Rank & Stocks to Consider
Wayfair currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail-wholesale sector are AutoNation (AN - Free Report) , Costco Wholesale (COST - Free Report) and Dollar Tree (DLTR - Free Report) . While AutoNation sports a Zacks Rank #1 (Strong Buy), Costco Wholesale and Dollar Tree carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
AutoNation has gained 16.3% over a year. The long-term earnings growth rate for AN is currently projected at 23.6%.
Shares of Costco Wholesale have rallied 33.4% over a year. The long-term earnings growth rate for COST is currently projected at 9.1%.
Dollar has gained 39.9% over a year. The long-term earnings growth rate for DLTR is currently projected at 15.5%.