The previously announced return-to-profits initiative by Wayfair took a step forward as the company reduced adjusted losses and bested Wall Street expectations for the first quarter.
Net loss in the quarter was $355 million, or $3.22 per diluted share, versus $319 million, or $3.04 per diluted share, in the year-earlier period. Adjusted for one-time events, net loss was $124 million, or $1.13 per diluted share, versus $206 million, or $1.96 per diluted share, in the year-prior period.
Wayfair beat an analyst consensus estimate for a loss of $1.69 per adjusted diluted share and revenues of $2.75 billion.
Net revenue was $2.77 billion versus $2.99 billion in the year-previous quarter. Loss from operations was $347 million versus $310 million in the year-before period, the company reported.
In a conference call, Niraz Shah, Wayfair co-founder, co-chairman and CEO, said that by driving customer and supplier loyalty, focusing on operational basics and boosting cost efficiency, the company has strengthened metrics despite a difficult macroeconomic environment.
“In the second quarter, we’re seeing improved year-over-year order trends,” Shah said. “And we’re just coming off the back of our seventh Way Day event. At the beginning of the year, as we planned a denser promotional calendar for 2023, we decided to try a three-day format for Way Day. We are very pleased by the engagement from both our suppliers and shoppers.”
In announcing the financial results, Shah said, “This was a strong quarter for Wayfair, and we are pleased to be seeing consistent market share gains and a significant improvement in cost structure versus last quarter that gets us to nearly adjusted EBITDA breakeven in Q1. Most exciting is that we expect to have positive adjusted EBITDA in the second quarter. We have always known, and now we are clearly demonstrating, that the Wayfair model is inherently profitable and that there is considerable opportunity in front of us to rapidly drive further margin expansion. Last August, we shared a roadmap laying out our path to profitability, and we have been executing against that plan. Through a focus on our three core initiatives of driving customer and supplier loyalty, nailing the basics, and cost efficiency, we have made significant strides in improving our offering and customer experience, simultaneously reducing our cost structure while investing for future growth.”
