Wayfair reported robust second-quarter results that exceeded Wall Street expectations, driving its stock price up approximately 30%. U.S. sales, the company’s largest market, grew 8.7% to $3.1 billion, marking the strongest performance in that region since 2020. The online furniture retailer also generated $301 million in free cash flow during the quarter, representing its best quarterly result on that metric since the pandemic period.
The company’s overall revenue increased 7.5% to $3.52 billion, surpassing analyst estimates. On an adjusted basis, Wayfair reported earnings per share of 95 cents, exceeding expectations. Additionally, the company beat forecasts on adjusted EBITDA, which reached $242 million compared with expectations of $230 million. The retailer delivered 10.6 million orders against estimates of 10.3 million, while active customers totaled 21.7 million versus expected 21.5 million. However, average order value came in at $332, below the anticipated $337.57.
Wayfair management attributed the results to capturing market share from traditional brick-and-mortar competitors, particularly as the housing market remains subdued. The company’s specialty retail brands grew by nearly 20% during the quarter, while its luxury brand Perigold experienced growth exceeding 35%. For the current quarter, Wayfair projected high single-digit percentage revenue growth, surpassing analyst expectations for 5% growth, and anticipated gross margins between 29.5% and 30.5%.
The company has been working to return to consistent profitability after the pandemic boom period as the home goods sector faces headwinds from tariffs, a sluggish housing market, and consumer spending constraints. Wayfair’s finance chief noted the company is expanding by attracting value-conscious shoppers and increasingly winning over luxury consumers amid challenging market conditions.
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