Wayfair (W) Q4 2024 earnings summary

Executive summary

• Q4 2024 net revenue reached $3.1 billion, up 0.2% year-over-year, with U.S. revenue up 1.1% and international revenue down 5.7%.

• Adjusted EBITDA for Q4 was $96 million (3.1% margin), and $453 million for the full year (3.8% margin), achieving approximately 50% year-over-year growth.

• The company exited the German market to focus on higher ROI opportunities, incurring $34 million in impairment charges.

• Net loss narrowed to $128 million in Q4 and $492 million for the year; adjusted diluted EPS was $(0.25) for Q4 and $0.13 for the year.

• Active customers declined 4.5% year-over-year to 21.4 million, but net revenue per active customer increased 3.4% to $555.

Financial highlights

• Q4 gross profit was $941 million (30.2% margin); full year gross profit was $3.6 billion (30.2% margin).

• Free Cash Flow for Q4 was $102 million; $83 million for the full year.

• Cash, cash equivalents, and short-term investments totaled $1.4 billion at year-end; total liquidity was $1.9 billion.

• Q4 average order value rose to $290 from $276 year-over-year; 64.5% of orders placed via mobile.

• Equity-based compensation declined by nearly 35% year-over-year in 2024.

Outlook and guidance

• Q1 2025 revenue expected to be flat to down year-over-year, with a 100 basis point drag from the German exit.

• Gross margin guidance for Q1: 30%-31%, expected near the midpoint.

• Advertising as a percentage of net revenue expected at 12%-13% in Q1.

• SOT G&A expected at $380-$390 million; Adjusted EBITDA margin anticipated in the 2%-4% range.

• Management targets continued profitable growth in 2025, focusing on market share gains and disciplined execution.