Covid-19: Lockdown shoppers cause sales surge for Wayfair
Wayfair has recorded year-over-year revenue growth of almost 20% for the quarter ending 31 March 2020, totalling $2.3 billion. The global online homeware retailer has partly put this performance down to increased demand in the Covid-19 crisis, receiving orders from millions of new customers stuck at home due to lockdown measures.
For Wayfair’s US business, net revenue grew by 19.1% to $317.3 million and international sales increased 23.7%, to $67.9 million. The retailer said overall profit for the period was $579.1 million, representing 24.9% of total net revenue.
Cash, cash equivalents, and short and long-term investments by Wayfair in the first three months of 2020 was $891 million, while adjusted EBITDA margin was 5.5%.
The eCommerce retailer also saw a 28.6% year-over-year increase in active customers in Q1 of 2020, rising to 21.1 million. Yet repeat customers were the primary drivers of Wayfair’s revenue growth, placing 69.8% of orders compared with 66% in the same period last year.
Niraj Shah, CEO, co-founder and co-chairman, Wayfair, said: “The broader market disruption has highlighted the many differentiated advantages we have built as the eCommerce leader in home over the last two decades. Millions of new shoppers have discovered Wayfair while they shelter in place at home, and we are seeing strong acceleration in new and repeat customer orders across almost all classes of goods and across all regions.”
The retailer believes it is in a strong position to continue performing strongly during the coronavirus pandemic.
Shah added: “In parallel, as we execute on the plans we set in motion late last year, we are making significant strides toward profitability by driving gross margin expansion, increasing marketing efficiencies, and gaining leverage on operating expenses. Our solid internal progress and healthy balance sheet put us in a position of strength in a highly dynamic environment.”
Source: Essential Retail