Wayfair (W) Q3 2025 earnings summary

Executive summary

• Net revenue for Q3 2025 increased 8.1% year-over-year to $3.12 billion, with U.S. revenue up 8.6% and international up 4.6%, despite the exit from the German market.

• Adjusted EBITDA surged over 70% year-over-year to $208 million, with a 6.7% margin, the highest outside the pandemic period.

• Net loss for Q3 2025 was $99 million, compared to a net loss of $74 million in Q3 2024; loss per share was $0.76 basic and diluted.

• Active customers totaled 21.2 million, with 80.1% of orders from repeat buyers, and average order value rose to $317.

• Share gains accelerated, driven by strong order momentum, new program launches, and technology investments, despite a sluggish housing market.

Financial highlights

• Gross profit for Q3 2025 was $934 million, representing 30.0% of net revenue.

• Adjusted EBITDA for Q3 2025 was $208 million (6.7% margin), up from $119 million in Q3 2024.

• Free cash flow for Q3 2025 was $93 million, compared to negative $9 million in Q3 2024.

• Ended the quarter with $1.2 billion in cash and $1.7 billion in total liquidity.

• Interest expense, net, increased to $31 million in Q3 2025 from $5 million in Q3 2024, primarily due to new debt issuances.

Outlook and guidance

• Q4 net revenue expected to grow mid-single digits year-over-year, with a 100 basis point drag from Germany exit.

• Gross margin guided to 30%-31%, likely at the low end due to reinvestment and seasonality.

• Adjusted EBITDA margin expected in the 5.5%-6.5% range for Q4.

• SOTG&A projected at $360-$370 million; equity-based compensation of $80-$100 million, including a new CEO award.

• Management continues to monitor macroeconomic conditions, including tariffs, inflation, and interest rates, but maintains a positive long-term outlook for online home goods retail.