Wayfair‘s first-quarter net loss improved year over year, but an analyst cast doubts on the furniture retailer’s longer-term future.
The company’s net loss stood at $248 million while net revenue slipped 1.6 per cent to $2.7 billion.
“Longer term, we have some doubts that Wayfair will ever return to the very punchy growth it used to pump out, including before the pandemic,” said Neil Saunders, MD at GlobalData.
“The blunt truth here is that Wayfair already has a high customer share in the US so growing this further – especially in a market that is becoming more competitive – is going to be extremely tough.”
Wayfair’s US net revenue fell 1 per cent to $2.4 billion while international net revenue declined 5.8 per cent to $338 million.
“We also think Wayfair has far fewer competitive advantages in the overseas markets in which it plays, which will make achieving superior growth challenging even as economies bounce back,” said Saunders.
“On top of all of this, the international business is still deeply in the red so growing it is not going to aid Wayfair’s aim of becoming more profitable – at least not initially.”
Meanwhile, Wayfair took pride in seeing the number of active customers rise 2.8 per cent to 22.3 million despite orders delivered decreasing 1 per cent to 9.6 million.
“Shoppers are increasingly choosing Wayfair, with year-over-year active customer growth once again positive and accelerating compared to last quarter,” said Niraj Shah, CEO, co-founder and co-chairman.
