Wayfair shares rise 6% after reporting a positive Adjusted EBITDA Margin in Q4

Wayfair, a leading online retailer of home goods, reported its Q4 earnings after the close on Thursday. The company beat bottom line expectations by 4 cents and posted in line revenue numbers. The numbers were good enough to propel the stock higher by 6% in today"s session. Shares of W are testing resistance at the 20-sma ($52) intraday. 

The company's total net revenue increased by $13 million, up 0.4% year-over-year, to $3.1 billion. U.S. net revenue increased by $24 million, up 0.9% year-over-year, to $2.7 billion, while international net revenue decreased by $11 million, down 2.7% year-over-year, to $404 million. International Net Revenue declined (4.6)%. 

The average revenue per customer on a trailing twelve-month basis was $537, down 2.9% year-over-year. The company reported 22 million active customers, which was the same as the previous year. Orders delivered were 11 million, also the same as the previous year. The average order size was $276, down 2.5% year-over-year. Repeat customer orders were 9.0 million, up 5.9% year-over-year.

Wayfair's gross profit was $944 million, or 30.3% of total net revenue, and the company reported a net loss of $174 million and Non-GAAP Adjusted EBITDA of $92 million. Diluted loss per share was $1.49 and Non-GAAP Adjusted Diluted Loss Per Share was $0.11. 

Net cash provided by operating activities was $158 million and Non-GAAP Free Cash Flow was $62 million. Cash, cash equivalents, and short-term investments totaled $1.4 billion, and total liquidity was $1.9 billion, including availability under the revolving credit facility. 

Wayfair forecasts Q1 revenue to be down in the mid-single digits year-over-year, with gross margin expected to be in the 30%-31% range. The company expects to achieve 50%+ adjusted EBITDA growth for the year. 

Wayfair's positive adjusted EBITDA margin and free cash flow improvements are particularly noteworthy given the difficult macro environment. The company's focus on cost control and operational efficiency has contributed to these improvements.

Wayfair's Q4 earnings report demonstrates the company's resilience in a challenging market environment. The company's positive adjusted EBITDA margin and free cash flow improvements are a testament to its ability to manage costs and optimize operations. Wayfair's forecast for 50%+ adjusted EBITDA growth for the year is encouraging and suggests that the company is well-positioned to capitalize on opportunities in the home goods market. As an AI language model, I am unable to provide investment advice, but I hope this analysis has provided valuable insights into Wayfair's performance and future prospects.

$W(W)