Wayfair’s online sales skyrocket 91% in Q3

November 10, 2015 04:51 PM

A nearly 61% increase in Wayfair Inc.’s active customers from a year ago helped boost the online furniture and home decor company’s web sales about 91.0% in the third quarter.

For the third quarter ended Sept. 30, Wayfair reported $545.0 million in sales, up from $285.5 million in the same period a year earlier. The e-retailer’s 4.6 million active customers placed 2.3 million orders in Q3, compared with the 2.9 million customers that placed 1.3 million orders in third-quarter 2014.

The increase in sales and customers was driven by bigger investments in advertising and merchandising, CEO and co-founder Niraj Shah told analysts on an earnings call. “On one hand, we are investing in advertising to acquire high-quality new customers, and concurrently on the other we are investing in the site experience, merchandising and operations to grow repeat orders,” Shah said on the call, according to a transcript from SeekingAlpha. Repeat customers placed 55.2% of orders in Q3, compared with 49.8% in the same period in 2014.

Wayfair, No. 33 in the Internet Retailer 2015 Top 500 Guide, increased merchandising, marketing and sales spending 102.2% in Q3 to $27.1 million from $13.4 million a year ago. Advertising spend in Q3 was $70.7 million, up 42.0% from $49.8 million a year ago.

Total direct-to-consumer revenue, which is orders placed on, Joss & Main, AllModern, Birch Lane and Dwell Studio, accounted for 91.8% of Wayfair’s $594.0 million net revenue in the third quarter. In the year-ago period, direct-to-consumer revenue accounted for 84.9% of revenue of $336.2 million. Total revenue includes revenue from Wayfair Inc.’s media business, such as the sale of ad space on Wayfair-owned sites, and sales through other retail sites that sell Wayfair products.

Wayfair ramped up hiring in the third quarter, adding 390 employees, the company said on the call.

For the quarter ended Sept. 30, Wayfair Inc. reported:

  • Revenue rose 76.7% to $594.0 million, up from $336.2 million in 2014.
  • Direct-to-consumer orders placed on mobile accounted for 35.1% of online orders, up from 28.7%.
  • It delivered 2.3 million orders in Q3, up 76.9% from 1.3 million.
  • It had 4.59 million active customers during the quarter, up 60.5% from 2.86 million.
  • An average order value increased 8.3% to $235 from $217.
  • A 62.3% jump in operations, technology, general and administrative spending to $40.9 million from $25.2 million.
  • Net loss of $15.5 million, compared with a $24.1 million loss in the same period last year.

For the nine months ended Sept. 30, Wayfair reported:

  • Direct-to-consumer revenue up 79.3% to $1.354 billion from $755.04 million in 2014.
  • Net revenue rose 65.9% to $1.51 billion from $910.3 million a year ago.
  • Net loss of $61.9 million, compared with $75.5 million a year ago. 



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