Wayfair Posts Fourth-Quarter Profit Beat but Misses on Revenue

Wayfair sees an increase in customer activity as the company beats Wall Street's earning expectations.
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Wayfair  (W) - Get Report swung to a fourth-quarter profit but the online home-decor store missed Wall Street's revenue forecast.

Shares of the Boston company were up 1.1% to $261 in premarket trading Thursday.

Wayfair on Thursday reported net income of $23.8 million, or 23 cents a share, compared with a loss of $330.2 million, or $3.54 a share, a year ago. Adjusted earnings were $1.24 a share, while the FactSet consensus called for 86 cents. 

Revenue in the quarter totaled $3.67 billion, up from $2.53 billion last year, but fell short of estimates for $3.76 billion.

Wayfair said active customers rose 53.7% to 31.2 million in the quarter. The average order value was $223, down from $226 a year ago. The company said 59.9% of orders placed in the quarter were on a mobile device, up from 54.8% last year.

Repeat customers placed 72.5% of total orders delivered in the fourth quarter of 2020, compared with 68.6% a year ago. Repeat customers placed 11.9 million orders in the quarter, up 55.6% year over year.

"Online shopping behavior is becoming increasingly entrenched and consumer demand for the home category remains strong," Niraj Shah, CEO, co-founder and co-chairman, said in a statement. 

Home furnishings companies have experienced increased business as the coronavirus pandemic has forced many employees to work from home. 

"As we look beyond the pandemic period, we are confident that our long-term orientation and years of investments should translate to compounding share gains and increasing profitability in a rapidly growing e-commerce market," Shad said.