Wayfair (NYSE: W), a furniture retailer, recently released its second-quarter earnings report. The company has been able to surpass profit expectations despite revenue not growing as fast as during the COVID-19 pandemic.
Wayfair’s second-quarter revenue was $3.9 billion, matching expectations from Wall Street. Sales declined year-on-year, but it was a difficult comparison because household goods were more in demand than usual during the pandemic. The adjusted earnings per share obtained in the second quarter of this year were $1.89, which was above analysts’ expectations but below last year’s level.
Wayfair believes profitability will improve over time due to its large customer base. During the last quarter, repeat customers accounted for 75% of Wayfair’s total order volume, which should reduce the need for marketing efforts to drive sales growth. Comparatively, this figure was just over 70% a quarter earlier. More than 33 million Wayfair users are active and the number continues to grow.
In the company’s own words, the retailer is emerging from the pandemic with an even better quality customer base. Wayfair will benefit long-term from this. Also, the retailer continues to develop its online business, which will maintain the momentum it built during the pandemic. Even though interest in landscaping has decreased slightly this year, household goods continue to be in demand.
According to the latest stock market figures, the cost of a W share was $263.82 on August 6.