Wayfair “Still Has a Lot to Prove” After Disappointing 4Q

Wayfair (Boston) reported an 11.4 percent drop in net revenue and a $202 million net loss in its fiscal fourth quarter, raising questions about the DTC brand’s post-pandemic growth prospects.

Neil Saunders, an analyst at GlobalData Retail, told Retail Dive:

“[A] fair slice of the customers and orders [Wayfair] has picked up during the pandemic came from people who were ‘forced’ to shop online because of health concerns about using physical stores. As the pandemic has abated, these people have migrated back to in-person shopping — something that remains very important in the furnishings sector where people often like to see and feel products before buying. … There is no denying that Wayfair has become a significant force in the home furnishings market, nor that it coped very well during the pandemic. However, on the fundamental question of whether its business model works, it still has a lot to prove.”

In December, Wayfair announced plans to expand its brick-and-mortar presence with three new stores in its headquarters state of Massachusetts. All three locations will open sometime in 2022.