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“Q3 marked another proofpoint of resilience for Wayfair with further market share capture in the face of sustained challenges in the category. Once again, we navigated a dynamic consumer environment while driving further discipline on costs to achieve a mid-single-digit Adjusted EBITDA margin for the second quarter in a row. As I’ve mentioned before, our north star is driving Adjusted EBITDA dollars in excess of equity-based compensation and capital expenditures, and we’re pleased to be making noteworthy improvements across each of these fronts,” said Niraj Shah, CEO, co-founder and co-chairman, Wayfair.

Shah continued, “We remain laser-focused on delivering healthy profitability while setting ourselves up for success as the category rebounds. The core goal across each of our initiatives in 2024 is to foster customer loyalty and spur repeat business while driving economic value. We're not just aiming for short-term gains, but building long-lasting relationships with our customers that will be accretive on both the top and bottom lines.”

Key Financial Statement and Operating Metrics


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

	(in millions, except LTM net revenue per active customer, average order value and per share data)
Key Financial Statement Metrics:
Net revenue	$	2,884	$	2,944	$	8,730	$	8,889
Gross profit	$	873	$	917	$	2,633	$	2,723
Loss from operations	$	(74)	$	(152)	$	(344)	$	(641)
Net loss	$	(74)	$	(163)	$	(364)	$	(564)
Loss per share:
Basic	$	(0.60)	$	(1.40)	$	(2.98)	$	(4.99)
Diluted	$	(0.60)	$	(1.40)	$	(2.98)	$	(4.99)
Net cash provided by operating activities	$	49	$	121	$	155	$	191
Key Operating Metrics:
Active customers (1)	22		22		22		22
LTM net revenue per active customer (2)	$	545	$	538	$	545	$	538
Orders delivered (3)	9		10		29		30
Average order value (4)	$	310	$	297	$	303	$	297
Non-GAAP Financial Measures:
Adjusted EBITDA	$	119	$	100	$	357	$	214
Free Cash Flow	$	(9)	$	42	$	(19)	$	(64)
Adjusted Diluted Earnings (Loss) per Share	$	0.22	$	(0.13)	$	0.38	$	(1.02)

(1) The number of active customers represents the total number of individual customers who have purchased at least once directly from our sites during the preceding twelve-month period. The change in active customers in a reported period captures both the inflow of new customers as well as the outflow of existing customers who have not made a purchase in the last twelve months. We view the number of active customers as a key indicator of our growth.

(3) Orders delivered represent the total orders delivered in any period, inclusive of orders that may eventually be returned. As we ship a large volume of packages through multiple carriers, actual delivery dates may not always be available, and as such we estimate delivery dates based on historical data. We recognize net revenue when an order is delivered, and therefore orders delivered, together with average order value, is an indicator of the net revenue we expect to recognize in a given period. We view orders delivered as a key indicator of our growth.

Wayfair will host a conference call and webcast to discuss its third quarter 2024 financial results today at 8 a.m. (ET). Investors and participants should register for the call in advance by visiting https://bit.ly/3AjK2fc. After registering, instructions will be shared on how to join the call. The call will also be available via live webcast at https://bit.ly/4hfCcE7. An archive of the webcast conference call will be available shortly after the call ends on Wayfair’s Investor website at investor.wayfair.com. Important information may be disseminated initially or exclusively via the Investor website; investors should consult the site to access this information.

This press release contains forward-looking statements within the meaning of federal and state securities laws. All statements other than statements of historical fact contained in this press release, including statements regarding our investment plans and anticipated returns on those investments, our future customer growth, our future results of operations and financial position, including our financial outlook, profitability goals, business strategy, plans and objectives of management for future operations, and, the impact of macroeconomic events and our response to such events, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “continues,” “could,” “intends,” “goals,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or the negative of these terms or other similar expressions.

Forward-looking statements are based on current expectations of future events. We cannot guarantee that any forward-looking statement will be accurate, although we believe that we have been reasonable in our expectations and assumptions. Investors should realize that if underlying assumptions prove inaccurate or that known or unknown risks or uncertainties materialize, actual results could vary materially from our expectations and projections. Investors are therefore cautioned not to place undue reliance on any forward-looking statements. We believe that these risks and uncertainties include, but are not limited to, adverse macroeconomic conditions, including rising and fluctuating interest rates and inflation, slower growth or the potential for recession, disruptions in the global supply chain, conditions affecting the retail environment for products we sell, and other matters that influence consumer spending and preferences, as well as our ability to plan for and respond to the impact of these conditions; our ability to acquire and retain customers in a cost-effective manner; our ability to increase our net revenue per active customer; our ability to build and maintain strong brands; our ability to manage our growth and expansion initiatives; and our ability to expand our business and compete successfully. A further list and description of risks, uncertainties and other factors that could cause or contribute to differences in our future results include the cautionary statements herein and in our most recent Annual Report on Form 10-K and in our other filings and reports with the Securities and Exchange Commission. We qualify all of our forward-looking statements by these cautionary statements.


	September 30,		December 31,
	2024		2023

	(in millions, except share and per share data)
Assets:
Current assets
Cash and cash equivalents	$	1,296	$	1,322
Short-term investments	32		29
Accounts receivable, net	155		140
Inventories	81		75
Prepaid expenses and other current assets	248		289
Total current assets	1,812		1,855
Operating lease right-of-use assets	888		820
Property and equipment, net	658		748
Other non-current assets	56		51
Total assets	$	3,414	$	3,474
Liabilities and Stockholders' Deficit:
Current liabilities
Accounts payable	$	1,187	$	1,234
Other current liabilities	982		949
Total current liabilities	2,169		2,183
Long-term debt	3,061		3,092
Operating lease liabilities, net of current	884		862
Other non-current liabilities	33		44
Total liabilities	6,147		6,181
Stockholders’ deficit:
Convertible preferred stock, $0.001 par value per share: 10,000,000 shares authorized and none issued at September 30, 2024 and December 31, 2023	—		—
Class A common stock, par value $0.001 per share, 500,000,000 shares authorized, 97,888,601 and 92,457,562 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	—		—
Class B common stock, par value $0.001 per share, 164,000,000 shares authorized, 25,691,295 shares issued and outstanding at September 30, 2024 and December 31, 2023	—		—
Additional paid-in capital	1,657		1,316
Accumulated deficit	(4,382)		(4,018)
Accumulated other comprehensive loss	(8)		(5)
Total stockholders' deficit	(2,733)		(2,707)
Total liabilities and stockholders' deficit	$	3,414	$	3,474


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

	(in millions, except per share data)
Net revenue (1)	$	2,884	$	2,944	$	8,730	$	8,889
Cost of goods sold (2)	2,011		2,027		6,097		6,166
Gross profit	873		917		2,633		2,723
Operating expenses:
Customer service and merchant fees (2)	112		136		350		419
Advertising	354		337		1,043		1,016
Selling, operations, technology, general and administrative (2)	480		596		1,503		1,850
Impairment and other related net charges	1		—		2		14
Restructuring charges	—		—		79		65
Total operating expenses	947		1,069		2,977		3,364
Loss from operations	(74)		(152)		(344)		(641)
Interest expense, net	(5)		(5)		(15)		(15)
Other income (expense), net	8		(4)		3		(2)
Gain on debt extinguishment	—		—		—		100
Loss before income taxes	(71)		(161)		(356)		(558)
Provision for income taxes, net	3		2		8		6
Net loss	$	(74)	$	(163)	$	(364)	$	(564)
Loss per share:
Basic	$	(0.60)	$	(1.40)	$	(2.98)	$	(4.99)
Diluted	$	(0.60)	$	(1.40)	$	(2.98)	$	(4.99)
Weighted-average number of shares of common stock outstanding used in computing per share amounts:
Basic	123		116		122		113
Diluted	123		116		122		113


	Nine Months Ended September 30,
	2024		2023

	(in millions)
Cash flows from operating activities:
Net loss	$	(364)	$	(564)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	297		312
Equity-based compensation expense	309		447
Amortization of discount and issuance costs on convertible notes	7		6
Impairment and other related net charges	2		14
Gain on debt extinguishment	—		(100)
Other non-cash adjustments	(5)		—
Changes in operating assets and liabilities:
Accounts receivable, net	(34)		140
Inventories	(7)		11
Prepaid expenses and other assets	3		19
Accounts payable and other liabilities	(53)		(94)
Net cash provided by operating activities	155		191

Cash flows for investing activities:
Purchase of short- and long-term investments	(37)		(4)
Sale and maturities of short- and long-term investments	33		229
Purchase of property and equipment	(53)		(101)
Site and software development costs	(121)		(154)

Net cash used in investing activities	(178)		(30)

Cash flows from financing activities:

Proceeds from issuance of convertible notes, net of issuance costs	—		678
Premiums paid for capped call confirmations	—		(87)

Payments to extinguish convertible debt	—		(514)
Other financing activities, net	3		—
Net cash provided by financing activities	3		77
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(6)		3
Net (decrease) increase in cash, cash equivalents and restricted cash	(26)		241

Cash, cash equivalents and restricted cash
Beginning of period	$	1,326	$	1,050
End of period	$	1,300	$	1,291

To supplement our condensed consolidated financial statements presented in accordance with generally accepted accounting principles (“GAAP”), this earnings release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Diluted Earnings or Loss per Share and Net Revenue Constant Currency Growth. We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We have provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure in this earnings release.

We calculate Adjusted EBITDA as net income or loss before depreciation and amortization, equity-based compensation and related taxes, interest income or expense, net, other income or expense, net, provision or benefit for income taxes, net, non-recurring items and other items not indicative of our ongoing operating performance. Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by Net Revenue. We disclose Adjusted EBITDA because it is a key measure used by our management and board of directors to evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we believe the exclusion of certain expenses in calculating Adjusted EBITDA facilitates operating performance comparisons on a period-to-period basis as these costs may vary independent of business performance. For instance, we exclude the impact of equity-based compensation and related taxes as we do not consider this item to be indicative of our core operating performance. Investors should, however, understand that equity-based compensation and related taxes will be a significant recurring expense in our business and an important part of the compensation provided to our employees. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.

We calculate Free Cash Flow as net cash provided by or used in operating activities less net cash used to purchase property and equipment and site and software development costs (collectively, “Capital Expenditures”). We disclose Free Cash Flow because it is an important indicator of our business performance as it measures the amount of cash we generate. Accordingly, we believe that Free Cash Flow provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management.

We calculate Adjusted Diluted Earnings or Loss per Share as net income or loss plus equity-based compensation and related taxes, provision or benefit for income taxes, net, non-recurring items, other items not indicative of our ongoing operating performance, and, if dilutive, interest expense associated with convertible debt instruments under the if-converted method divided by the weighted-average number of shares of common stock used in the computation of diluted earnings or loss per share. Accordingly, we believe that these adjustments to our adjusted diluted net income or loss before calculating per share amounts for all periods presented provide a more meaningful comparison between our operating results from period to period.

We calculate Net Revenue Constant Currency Growth by translating the current period local currency net revenue by the currency exchange rates used to translate the financial statements in the comparable prior-year period. We disclose Net Revenue Constant Currency Growth because it is an important indicator of our operating results. Accordingly, we believe that Net Revenue Constant Currency Growth provides useful information to investors and others in understanding and evaluating trends in our operating results in the same manner as our management.

We calculate forward-looking non-GAAP financial measures based on internal forecasts that omit certain amounts that would be included in forward-looking GAAP financial measures. We do not attempt to provide a reconciliation of forward-looking non-GAAP financial measures to forward looking GAAP financial measures because forecasting the timing or amount of items that have not yet occurred and are out of our control is inherently uncertain and unavailable without unreasonable efforts. Further, we believe that such reconciliations would imply a degree of precision and certainty that could be confusing to investors. Such items could have a substantial impact on GAAP measures of financial performance.

The non-GAAP financial measures have limitations as analytical tools. We do not, nor do we suggest that investors should consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors should also note that the non-GAAP financial measures we use may not be the same non-GAAP financial measures and may not be calculated in the same manner as that of other companies, including other companies in our industry.

The following table reflects the reconciliation of net income or loss to Adjusted EBITDA and Adjusted EBITDA margin for each of the periods indicated:


		Three Months Ended September 30,						Nine Months Ended September 30,
		2024			2023			2024			2023

		(in millions)
Reconciliation of Adjusted EBITDA:
Net loss		$	(74)		$	(163)		$	(364)		$	(564)
Depreciation and amortization		94			106			297			312
Equity-based compensation and related taxes		98			146			323			464
Interest expense, net		5			5			15			15
Other (income) expense, net		(8)			4			(3)			2
Provision for income taxes, net		3			2			8			6
Other:
Impairment and other related net charges (1)		1			—			2			14
Restructuring charges (2)		—			—			79			65
Gain on debt extinguishment (3)		—			—			—			(100)
Adjusted EBITDA		$	119		$	100		$	357		$	214

Net revenue		$	2,884		$	2,944		$	8,730		$	8,889
Net loss margin		(2.6)		%	(5.5)		%	(4.2)		%	(6.3)		%
Adjusted EBITDA Margin		4.1		%	3.4		%	4.1		%	2.4		%

(1)	During the three and nine months ended September 30, 2024, we recorded charges of $1 million and $2 million, respectively, related to changes in sublease market conditions for U.S. office locations. During the nine months ended September 30, 2023, we recorded charges of $14 million, inclusive of $5 million related to consolidation of certain customer service centers and $9 million related to construction in progress assets at identified U.S. locations.
(2)	During the nine months ended September 30, 2024, we incurred $79 million of charges consisting primarily of one-time employee severance and benefit costs associated with the January 2024 workforce reductions. During the nine months ended September 30, 2023, we incurred $65 million of charges consisting primarily of one-time employee severance and benefit costs associated with the January 2023 workforce reductions.
(3)	During the nine months ended September 30, 2023, we recorded a $100 million gain on debt extinguishment upon repurchase of $83 million in aggregate principal amount of our 2024 Notes and $535 million in aggregate principal amount of our 2025 Notes.

The following table presents Adjusted EBITDA attributable to our segments, and the reconciliation of net income or loss to Adjusted EBITDA is presented in the preceding table:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

	(in millions)
Segment Adjusted EBITDA:
U.S.	$	141	$	123	$	461	$	313
International	(22)		(23)		(104)		(99)
Adjusted EBITDA	$	119	$	100	$	357	$	214

The following table presents a reconciliation of net cash provided by or used in operating activities to Free Cash Flow for each of the periods indicated:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

	(in millions)
Net cash provided by operating activities	$	49	$	121	$	155	$	191
Purchase of property and equipment	(17)		(30)		(53)		(101)
Site and software development costs	(41)		(49)		(121)		(154)
Free Cash Flow	$	(9)	$	42	$	(19)	$	(64)

A reconciliation of the numerator and denominator for diluted earnings or loss per share, the most directly comparable GAAP financial measure, to the numerator and denominator for Adjusted Diluted Earnings or Loss per Share, in order to calculate Adjusted Diluted Earnings or Loss per Share is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

	(in millions, except per share data)
Numerator:
Numerator for basic and diluted loss per share - net loss	$	(74)	$	(163)	$	(364)	$	(564)



Adjustments to net loss

Equity-based compensation and related taxes	98		146		323		464
Provision for income taxes, net	3		2		8		6
Other:
Impairment and other related net charges	1		—		2		14
Restructuring charges	—		—		79		65
Gain on debt extinguishment	—		—		—		(100)
Numerator for Adjusted Diluted Earnings (Loss) per Share - Adjusted net income (loss)	$	28	$	(15)	$	48	$	(115)

Denominator:
Denominator for basic and diluted loss per share - weighted-average number of shares of common stock outstanding	123		116		122		113
Adjustments to effect of dilutive securities:
Restricted stock units	—		—		1		—

Denominator for Adjusted Diluted Earnings (Loss) per Share - Adjusted weighted-average number of shares of common stock outstanding after the effect of dilutive securities	123		116		123		113
Diluted Loss per Share	$	(0.60)	$	(1.40)	$	(2.98)	$	(4.99)
Adjusted Diluted Earnings (Loss) per Share	$	0.22	$	(0.13)	$	0.38	$	(1.02)