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Online retailer revenue increased 20% in the first quarter as people got stuck during the … [+]
Wayfair and its two co-founders have emerged as clear winners of the coronavirus pandemic, as shoppers stayed inside and spent to improve their living spaces, boosting income and stocks.
The online home furniture company’s revenue increased 20% in the first quarter, driven by everything from office and game room furniture to kitchen appliances as the company delivered 9.9 million items, compared to 8.2 million in the same period of the previous year. News of the results caused Wayfair shares to rise 25% on Tuesday morning, leading to an 85% gain to date, compared to an 11% decline for the S&P 500.
The race has fueled the individual fortunes of co-founders Niraj Shah, 46, and Steve Conine, 47, at $ 2.1 billion. They each own 11.6 million shares, according to the filings, and the value of those shares has risen to $ 1.9 billion from $ 700 million before the pandemic hit the US. USA
Long based on an over-spending formula in the pursuit of growth, Wayfair remains unprofitable, and those losses hurt investors who sold the shares and reduced the founders’ fortunes to less than $ 1 billion. .
Revenue soared 20% to $ 2.3 billion in the quarter, just less than the $ 2.31 billion that analysts had projected, with the average order dropping $ 2 the year before to $ 235. LLosses widened to $ 286 million from $ 200 million, but excluding one-time items, losses totaled $ 2.30 per share, below the $ 2.61 analysts had expected.
Co-founder and CEO Niraj Shah said in a statement that Wayfair It is “moving significantly toward profitability” by driving gross margin expansion, increasing marketing efficiencies, and leveraging operating expenses.
“Millions of new buyers have discovered Wayfair while taking refuge in their place at home, and we are seeing a sharp acceleration in new and repeat customer orders in almost all product classes and in all regions,” Shah said.
Wayfair started in 2002 in Conine’s spare room. The two soon operated 250 websites that sold everything from stools to bird feeders and listed the company in 2014. Wayfair, which now offers more than 18 million products, generated sales of $ 9.1 billion in 2019, 35% more than the previous year. It also posted losses of around $ 1 billion.
