Wayfair revenues drop but remain above pre-pandemic levels

A 10% drop in YoY revenue would typically prompt mad side-eye from investors. But that’s not the case for Wayfair.

Everyone knew it would be tough to re-create the boom the online furniture company enjoyed last year, but Wayfair hung in there in Q2.

• Revenues reached $3.86 billion—above pre-pandemic levels—indicating the company was able to retain many of its new customers from 2020.
• Wayfair’s active customers (aka shoppers who ordered more than once) grew to 31.1 million, an almost 20% YoY increase.

“We believe we are leaving the pandemic period with an even stronger repeat customer base than when we entered it. We should have long-lasting benefits, given it cost us relatively less to drive repeat purchases than initial orders,” CEO Niraj Shah said during a Thursday earnings call.

Zoom out: Keeping customers will be key, as home spending shifts back to in-person shopping, according to Earnest Research. “Even if online growth supercharges again, the majority of Home sales remain in traditional brick-and-mortar, highlighting the sector’s reliance on consumer foot traffic,” per the report.

• This year, online spending for home purchases decreased to 70% of its 2019 level, from a pandemic high of 130% over 2019, Earnest noted.—KM